Auckland Airport reports full year loss

Auckland Airport has made another full year underlying loss, as border closures disrupted domestic and international air travel for much of the year.

Photo: RNZ / Samuel Rillstone

“Although Auckland Airport’s results continued to reflect the impact of the pandemic and the challenging operating conditions of the 2022 financial year, the reopening of the border to Australia in April had marked a turning point in the organization’s recovery,” airport chief executive Carrie Hurihanganui said , adding there was solid demand for travel to and from New Zealand.

“We are in a global race to attract back visitors and international airline routes and services and New Zealand needs to work hard to ensure their return.

“We are now progressing our capital plan to build a stronger Auckland Airport, delivering on a world-class travel experience for travelers and fueling our future success.”

Key numbers for the 12 months ended June compared to a year ago:

  • Net profit $ 191.6m vs $ 464.2m
  • Revenue $ 300.3m vs $ 281.1m
  • Underlying tax loss ($ 11.6m) vs ($ 41.8m)
  • Passenger numbers 5.6m vs 6.4m
  • No dividend

Auckland Airport’s investment property division was a bright spot, given the strength of the industrial property market, with a 9 percent increase in rents to $ 127.5m, while the value of the portfolio rose 10 percent to $ 2.9 billion over the year.

However, the recovery was not without turbulence, she said.

“As aviation rebounds there continues to be some uncertainty about the shape of recovery ahead with global operational challenges, such as labor shortages, currently constraining the system’s capacity.”

The airport spent $ 98.7m during the closures on maintenance and infrastructure projects, such as airfield maintenance, pavement renewal, roading development and jet fuel line upgrades, Hurihanganui said.

The airport was consulting with airlines regarding the design of the new $ 1 billion-plus combined terminal, to be delivered in stages in line with the industry’s recovery.

“As investments were made in new assets, the prices that airlines pay will have to increase over time.”

The airport was taking a more conservative approach to the recovery than the international Air Travel Association (IATA), which recently forecast the global industry would recover to pre-pandemic levels in the 2024 calendar year, with the Asia-Pacific region to follow at a later stage.

“While we are hopeful of a strong recovery over the next 18 months, our outlook remains conservative,” Hurihanganui said.

Auckland Airport expected to make a net underlying profit of between $ 50m and $ 100m in the current financial year.

Capital spending of between $ 600m and $ 700m was subject to change, pending the outcome of negotiations with major airline customers, ahead of another round of aeronautical prices scheduled for June 2023.