More people taking the easy way out

More people taking the easy way out

Increased passenger numbers have been reflected in higher than expected revenue for Dunedin International Airport Limited (DIAL) in the financial year, to 30 June 2012.

Total revenue reached $10,314,040, a 21.3% increase on 2011 and 17.1% above budget.

"It is particularly appropriate that on marking our 50th anniversary milestone, we have moved through another by passing the $10 million revenue threshold," says DIAL Chairman Stuart McLauchlan.

Aeronautical income was $3,988,294, a 51% increase on last year’s $2,640,001 and comprised 38.7% of total income compared to 31% for the previous financial year.

Much of the increase in aeronautical revenue is the result of an 11.0% increase in capacity and a resulting 9.9% increase in total passenger numbers which reached 853,650. Domestic passenger numbers grew by 11.2% to 790,554, again attributable to capacity, while international passenger numbers recorded a modest 3.9% decline to 63,096. Airline aircraft movements increased by 6.2%.

Mr McLauchlan says DIAL's statement of intent - 'More people, flying more often, to and from more places' - was clearly evidenced this year with the introduction of a daily return service between Dunedin and Auckland via Jetstar.

"Capacity and competition on this route is critical for both the leisure and business market, and with Auckland a key port for the international visitor, it provides further opportunity for the Dunedin visitor economy to connect with international markets. The numbers speak for themselves, in the first year of operations the airline carried just on 100,000 passengers."

Landing charges to airlines were increased from 1 December 2011 following a lengthy and robust process which was carried out within the Commerce Commission's framework, Chief Executive John McCall explains.

"This is the first increase since 2001 and over the ensuing decade we have upgraded the terminal (2005/6) and invested in the runway and gate areas to accommodate new aircraft such as the Airbus A320 and the Boeing 737-800."

Non-aeronautical income comprised 60.8% of DIAL's total revenue, rising 7.4% to $6,274,186. This is derived from passenger activities, concessionaire’s payments, property rental, car parking and dairy farming.

Overall, the airport company returned an operating surplus after tax of $1,105,338 which compares favourably to $713,592 in 2011.

One of the other key features of the financial year was a 51.9% increase in shareholders' funds which now stand at $42,103,001; following a five yearly revaluation completed as part of the company’s financial reporting requirements.

The revaluation was carried out by independent registered valuers, Opus International Consultants and Telfer Young (Canterbury), specialists in the valuation of infrastructure assets.

A dividend of $396,000 (4.5c per share was declared and paid during the year, with a further payment of 7.5c per share (totalling $660,000) proposed to be made in November 2012.

Mr McCall says maintenance of DIAL's core asset will always be a priority and planning is underway for the runway overlay which will be completed in 2013.

"This work has been brought forward due to accelerated deterioration of the existing pavement. However, favourable exchange rates and locking in bitumen prices, along with the 2013 scheduled maintenance that is no longer required as a result of the overlay, means a saving of $1.38 million."

Development of DIAL's farming activities this year centred on a new herring bone milking shed, designed to increase productivity on the company's Otokia property. Income was impacted by lower milk prices and came in at $599,470, below budget by 5.4%.

More people flying more often to and from more places

Dunedin International Airport Limited (DIAL) is a public unlisted company, established under the Airport Authorities Act 1966, and incorporated in 1988. It is equally owned by the Crown and Dunedin City Holdings Ltd, (a company of Dunedin City Council).

DIAL services both the domestic and international market via Air New Zealand, Jet Star and Virgin airlines and supports over 850,000 passengers annually.

DIAL is a diversified operation with multiple sources of non–aeronautical income. It contributes an estimated 1.5% to the region’s GDP and directly and indirectly, provides employment for more than 250 people.

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