Chairwoman Joan Withers announced yesterday that: "After careful consideration of the capital structure of the business, and as a signal of confidence in our long-term prospects, cash generation and ability to fund our growth aspiration, the board is changing its dividend policy from paying 90% to paying 100% of net profit after tax."
As a result of the lift in financial performance and changed dividend policy, total dividends paid to shareholders for the 2012 financial year increased by 20.7% to 10.5c per share, with a final dividend of 6.1cps.
The airport company, which has a share in Queenstown Airport, reported operating earnings of $319.3 million in the year ended June, up 7.1% on the $298.2 million reported in the previous corresponding period.
Reported profit was up 41.2% to $142.3 million from $100.8 million and the underlying profit, excluding investment property gains, was $139 million, up 15%.
Mrs Withers said the improved results were largely driven by growth in passenger numbers across the company's airport interests.
At Auckland Airport, total international passenger movements, including transits, were up 5.1% and total domestic passenger movements were up 3.3%Queenstown's international passenger movements were up 21% and domestic movements were up 11.6%.
At the company's Cairns airport, international passenger movements were up 3.5% while domestic passenger movements were up 3.2%. Mackay Airport also continued its good growth on the back of the resource sector, with passenger movements up 7.7%.
"While there are clearly more people travelling to and from New Zealand than ever before, a closer look at the statistics reveals a fundamental shift in global travel demographics," Mrs Withers said.
Strong growth was occurring out of Australia, China and many other Southeast Asian countries, but numbers travelling out of the United Kingdom, Europe, Japan and the United States were falling. That reinforced the need to adapt, she said.
Craigs Investment Partners broker Chris Timms said the company's guidance was "flat", indicating nothing out of the ordinary was expected in the coming year.
"There have been a lot of interim announcements through the year, particularly around passenger growth. Auckland Airport is working its Asia and China routes hard. That is an area the group will continue to focus on in the coming year."
The dividend policy was surprising, more than anticipated and welcomed, Mr Timms said.
The change was a further indication of how comfortable the company was with its cash position.
When companies cut dividends, it was usually because profits were down or unexpected costs had arisen. Auckland Airport was showing confidence in its future, he said.
Auckland Airport acting chief executive Simon Robertson said 2013 was an important time for the company. The board was optimistic about the 2013 financial year and expected reported profit to be between $143 million and $150 million.
