Auckland ports and airport deliver value to ratepayers

Investment valuations increase by over $1 billion since November 2010.

21 May 2014, Auckland. Auckland Council Investments Ltd (ACIL), has published new figures today showing that the value of the Council’s key financial investments has grown by over $1 billion in the past four years. At inception of ACIL it was $1,509 million and its now $2,541 million, an increase of 69% over 3.5 years.

ACIL Chief Executive Gary Swift said the gains were mostly driven by the strong operating performance of the city’s ports and the airport.

“The strong operating performance of the city’s key trade and travel gateways has lifted the underlying value of the Council’s financial investments, by over $1 billion since November 2010,” Mr Swift said.

A new valuation of Ports of Auckland Ltd, conducted by PWC shows the valuation of the ports has increased from $623 million to $1.079 billion, a 73% increase on the last formal valuation as at June 2010.

“This increase in value reflects higher ongoing operating profits. A big contributor to this has been the success over the past three years in lifting the productivity and through-put of the port, combined with a strong focus on commercial governance to get the right result for Auckland,” he said.

The strong performance of the Council’s 22.4% shareholding in Auckland International Airport Ltd has also bolstered the City’s investment portfolio. The Council’s shareholding is valued at around $1.127 billion, an increase of $506 million or 81% over the November 2010 valuation.

Since its formation in 2010, ACIL has returned dividends of $88.3 million to Auckland Council. It is planning a further dividend payment of $156 million before 30 June this year including $101.5 million following the Auckland Airport capital return. As a result, the total distribution to Council in 2013/14 will be significantly above the $45 million ACIL had budgeted.

“A pleasing aspect is how all of the Council’s major financial assets have played their part in the recent value gains. This includes the $327 million Diversified Financial Asset portfolio which recorded gains of $67 million (26%) while also making distributions of $24 million in the period since November 2010.”

ACIL is a Council Controlled Organisation which owns and manages key financial investments on behalf of Auckland Council, and ultimately the people of Auckland. The key assets include the Ports of Auckland Ltd (100%), Auckland International Airport Ltd (22.5%), and 100% of Auckland Film Studios Limited (which has also grown in value). ACIL also manages the Council’s Diversified Financial Asset portfolio.

“The strong performance of all these investments ultimately means increased returns to Auckland Council where the proceeds are used to help make Auckland the world’s most liveable city,” Mr Swift said.

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