Auckland airport records 80 percent drop in earnings, does not expect a trans-Tasman bubble by June 30

Auckland International Airport has posted an after-tax profit of $ 28 million for the six months through December, forecasting an annual loss of up to $ 55 million as hopes for a Tasmanian bubble before July are dashed. .

The intermediate benefit is an 80 percent reduction from the previous year. By allowing adjustments, including eliminating increases in property value due to annual volatility, the company had a net underlying loss after tax of $ 10.5 million.

Auckland Airport Chief Executive Officer Adrian Littlewood said he did not expect a trans-Tasmanian bubble to take off before June 30 and that the company expected to post an after-tax loss of between $ 35 million and $ 55 million for the fiscal year. 2021.

“While the Government remains committed to restarting travel to and from Tasmania, and we support it, for the purposes of this underlying revenue guidance we have assumed that there will be no return travel to Tasmania without material quarantine for the remainder. of fiscal year 2021 “.

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The guide also assumes that there will be no more long-term locks during the period, he said.

Shareholders will not receive dividends on account.

The national gateway has been deeply affected by Covid-19 border restrictions: international passengers were down 97% and domestic passengers 45%, causing the total number of passengers to drop 73% to 2, 8 million, compared to the six months through December 31, 2019..

Its stock price has fallen $ 1.40 over the past year to trade at around $ 7. In August, it posted an annual profit of $ 194 million, 63% less than the previous year.

Brokerage firm Forsyth Barr said Thursday’s interim result was the company’s first after tax losses since it was listed in 1998.

Littlewood said the airport’s recovery route was strongly linked to non-quarantined two-way trans-Tasmania travel.

Low passenger numbers, especially international and transit passengers, resulted in significant declines in the company’s key aviation, retail and transportation revenue, he said.

Revenue from hotel operations and its investment in the Queenstown airport also declined, it said.

Littlewood said the Auckland Airport commercial property business was a highlight of the result with real estate revenues increasing 2.4% to $ 47 million.

Its commercial property portfolio is now valued at around $ 2.4 billion, up 15 percent in the year through December.

The Auckland Airport result comes a day after Queenstown Airport, of which Auckland Airport owns a quarter, posted a profit of $ 2.2 million over the six months to December, a drop of 80 percent over the previous year.

Littlewood said that early in the pandemic Auckland Airport was able to raise $ 1.2 billion, which kept it in good stead. He had about $ 700 million in cash on hand.

“That gives us a buffer. But obviously we’re not making any money yet until, in particular, Trans-Tasman starts going two-way. “

He said it was difficult to predict what kind of passenger numbers the airport might expect from a quarantine-free trans-Tasmanian bubble.

The first of 450 Auckland airport employees would receive their first Covid-19 vaccines this weekend, he said.

Auckland Airport President Patrick Strange said domestic travel was beginning to rebuild and has now recovered to around 65 percent of pre-pandemic levels.

“The first half of fiscal 2021 has continued to be a challenging time for both the company and the broader aviation industry,” Strange said.

“While we were pleased to see domestic travel beginning to rebuild, international travel has remained very low.”