Auckland Airport. trading update. Simon Robertson Chief Financial Officer

Transcription

1 Auckland Airport Equity raising and trading update Simon Robertson Chief Financial Officer

2 Important Information This document does not constitute a recommendation by Auckland International Airport Limited ("Issuer or Auckland Airport ), Credit Suisse (Australia) Limited or First NZ Capital Securities Limited ( Joint Lead Managers ) nor any of their respective directors, officers, employees or agents to subscribe for, or purchase, any of the Shares under the Offer. Neither the Joint Lead Managers nor any of their respective directors, officers, employees and agents accept liability whatsoever for any loss arising from this document or its contents or otherwise arising in connection with the Offer. Applications for the Retail Entitlement Offer may only be made by completing and lodging the personalised Entitlement and Acceptance Form accompanying the Prospectus. The Prospectus is an important document and should be read carefully. Investors should consider the risks that are associated with an investment in the shares, particularly with regard to their personal circumstances (including financial and tax issues). A summary of the principal risks associated with the Issuer are set out in the Prospectus under the heading Risks. All of the numerical data provided in this document is derived from the Prospectus dated 27 January 2010 ( Prospectus ) relating to the Offer, unless otherwise indicated. Expressions defined in the Prospectus have the same meaning in this document. The Institutional Entitlement Offer is open only to Institutional Investors who are Shareholders in Auckland Airport as at 7.00pm on the Record Date with a registered address in New Zealand, Australia, a Member State of the European Economic Area which has implemented Prospectus Directive 2003/71/EC, the United Kingdom, Norway, France, Italy, Hong Kong and Singapore or in any other jurisdiction to whom an offer of shares can lawfully be made under all applicable laws, and without the need for any registration, lodgement or other similar formality. The Retail Entitlement Offer is open only to Shareholders in Auckland Airport with a registered address in New Zealand or Australia as at 7.00pm (New Zealand time) on the Record Date, not in the United States and who are not Institutional Investors. This document may not be used for the purposes of, and does not constitute, an offer or invitation in any place in which, or to any person to whom, it would not be lawful to make such an offer or invitation. Other than as set out in the Prospectus, no action has been taken to register or qualify the New Shares or otherwise permit a public offering of the new shares in any jurisdiction other than New Zealand and Australia. This document does not constitute an offer of securities in the United States or to any US Person (as defined in Regulation S under the US Securities Act of 1933, as amended), or to any person acting for the account or benefit of a US person. A copy of the Prospectus is available free of charge on Auckland Airport s website: 2

3 EXECUTIVE SUMMARY

4 Executive Summary Equity raising Fully underwritten equity raising of NZ$126.4 million ( Offer ) 1-for-16 pro rata entitlement offer The Application Price is NZ$1.65 per New Share Offer structure No Entitlements trading New Shares in respect of Entitlements not, or not able to be, taken up by Shareholders will be offered in Bookbuilds Institutional New Shares will be allotted on 4 February 2010 Retail New Shares will be allotted on 25 February 2010 Purpose The proceeds of the Offer will be used to repay a portion of the debt drawn down to pay for the purchase of a 24.55% stake in Cairns and Mackay Airports ( NQ Airports ) (the Acquisition ) 1H10 Operating EBITDA of NZ$138.8 million (vs. NZ$138.7 million in 1H09) Unaudited management results to 31 December H10 Profit after tax, excluding investment property fair value adjustment, of NZ$54.0 million (vs. NZ$51.6 million in 1H09) 1H10 Profit after tax, including investment property fair value adjustment, of NZ$54.0 million (vs. NZ$9.8 million in 1H09) 4

5 OFFER OVERVIEW

6 Offer structure The Offer comprises four parts: Component Description Date Institutional Entitlement Offer Institutional Bookbuild Retail Entitlement Offer Retail Bookbuild Eligible Institutional Shareholders will be approached by the Joint Lead Managers and each may take up all, part, or none of their Entitlement May take up their Entitlements by 2.00pm (NZT) on 28 January 2010 New Shares attributable to lapsed Entitlements of Eligible Institutional Shareholders and Ineligible Institutional Shareholders will be offered to Eligible Investors in an Institutional Bookbuild on 29 January 2010 Eligible Investors must be Institutional Investors Eligible Retail Shareholders are sent the Prospectus together with a personalised Entitlement and Acceptance Form and each may take up all, part, or none of their Entitlement May take up their Entitlements by 7.00pm (NZT) on 18 February 2010 New Shares attributable to lapsed Entitlements of Eligible Retail Shareholders and Ineligible Retail Shareholders will be offered to Eligible Investors in a Retail Bookbuild on 22 February Eligible Investors must be Institutional Investors January 29 January 2-18 February 22 February 6

7 Offer structure (continued) The Offer structure is a first in terms of pro rata offers in New Zealand, and is well accepted in Australia Institutional component of the Offer (being the Institutional Entitlement Offer and the Institutional Bookbuild) is accelerated and occurs over three days immediately after the Offer is announced No trading of Entitlements New Shares attributable to Entitlements not taken up by Eligible Shareholders (along with New Shares attributable to Entitlements of Ineligible Shareholders) will be offered to Eligible Investors (who must be Institutional Investors) through Bookbuilds Any premium achieved for the New Shares in the Bookbuilds will be returned to those Shareholders who do not take up their Entitlements or are ineligible to do so 7

8 Advantages of Offer structure The Offer structure has the following advantages: Eligible Retail Shareholders will have the benefit of knowing the outcome of the Institutional Entitlement Offer and Institutional Bookbuild prior to deciding whether or not to take up their entitlement Shareholders not taking up their Entitlements will not be required to pay any brokerage or incur other transaction costs for their Entitlements to be offered under the Bookbuilds Shareholders who, for any reason, do not take up their Entitlement may still receive some value for their Entitlement 8

9 Offer terms Entitlement Ratio 1-for-16 Maximum New Shares to be issued 76,617,702 Application Price NZ$1.65 Discount to theoretical ex-entitlements price % Total equity raised Ranking Eligible Shareholders Joint Lead Managers and Underwriters Broker stamping fees NZ$126.4 million Equally with Existing Shares New Shares will be entitled to any interim dividend paid in relation to the six months ended 31 December 2009 Institutional Entitlement Offer - open only to Institutional Investors who are Shareholders in Auckland Airport with a registered address in New Zealand, Australia and other jurisdictions as described in the Prospectus as at 7.00pm on the Record Date Retail Entitlement Offer - open only to Shareholders in Auckland Airport with a registered address in New Zealand or Australia as at 7.00pm on the Record Date and who are not Institutional Investors Credit Suisse (Australia) Limited and First NZ Capital Securities Limited 0.5% (capped at NZ$300) for each stamped acceptance forms from NZX Primary Market Participants and ASX Stockbrokers (subject to maximum aggregate stamped acceptances of NZ$150,000) 1. The theoretical ex-entitlements price is calculated based on Auckland Airport s closing price on 26 January 2010 of NZ$1.92 9

10 Offer timetable Institutional Entitlement Offer Trading halt commenced and Institutional Entitlement Offer opens 27 January 2010 Institutional Entitlement Offer closes 28 January 2010 Institutional Bookbuild 29 January 2010 Record Date for determining Entitlements 7.00pm (NZT), 1 February 2010 Trading halt lifted Settlement of Institutional Entitlement Offer and Institutional Bookbuild 4 February 2010 New Shares allotted pursuant to the Institutional Entitlement Offer and Institutional Bookbuild expected to commence trading on the NZSX and ASX Open of trading on the NZSX and ASX on 2 February February 2010 on the NZSX 5 February 2010 on ASX Retail Entitlement Offer Record Date for determining Entitlements 7.00pm (NZT), 1 February 2010 Expected mailing of Prospectus and Entitlement and Acceptance Forms By 2 February 2010 Retail Entitlement Offer opens 2 February 2010 Retail Entitlement Offer closes 18 February 2010 Retail Bookbuild 22 February 2010 Settlement of Retail Entitlement Offer and Retail Bookbuild 25 February 2010 New Shares allotted pursuant to the Retail Entitlement Offer and Retail Bookbuild expected to commence trading on the NZSX and ASX 25 February 2010 on the NZSX 26 February 2010 on ASX 10

11 TRADING PERFORMANCE TO 31 DECEMBER 2009

12 Summary of 1H10 unaudited management results Summary of 1H10 results 1 Amount Movement compared to 1H09 Total passenger volumes 6,782, % International passenger volumes (excl. transits / transfers) 3,274, % Domestic passenger volumes 3,046, % Aircraft movements 78, % Aircraft tonnage (tonnes) 2,874, % Revenue NZ$182.9m -0.6% Operating EBITDA 2 NZ$138.8m +0.1% Profit after tax, excluding investment property fair value adjustment Profit after tax, including investment property fair value adjustment NZ$54.0m +4.7% NZ$54.0m % 1. 1H10 results in this document and the Prospectus are based on unaudited management results for the six months ended 31 December Auckland Airport's financial results for the six months ended 31 December 2009 are due to be released at the end of February 2010 and may differ from the results shown in this document. Auckland Airport's financial results for the six months ended 31 December 2009 are subject to finalisation and review by Auckland Airport's auditors. 2. Operating earnings before interest, tax, depreciation and amortisation, and before investment property fair value decreases or increases 12

13 Passenger volumes Passenger volumes 1H10 1H09 % change International passengers (excl. transits / transfers) 3,274,250 3,227, % Transits / transfers 461, , % Total international passengers 3,735,360 3,758, % Domestic passengers 3,046,882 2,872, % Total passenger movements 6,782,242 6,630, % Aircraft movements 78,162 80, % Aircraft tonnage (tonnes) 2,874,948 3,010, % Total passenger volumes rose 2.3% compared to 1H09, driven by increases on trans-tasman routes and growth in domestic travel passenger numbers Total aircraft movements decreased 2.9% compared to 1H09, reflecting decreased frequency of aircraft movements on domestic routes offset by increased frequency on aircraft movements on international routes International passenger numbers (excluding transits / transfers) increased 1.4% compared to 1H09, attributable to trans-tasman routes reflecting competing airfares and increased availability of seats Full impact of Pacific Blue commencing services in Sep 2009 and Jetstar commencing in Apr 2009 Global economic downturn and swine flu concerns impacted long haul travel and transits / transfers Domestic passengers increased 6.1% compared to 1H09, driven by strong competition Jetstar replaced Qantas as a domestic carrier in July

14 Financial performance Financial performance (NZ$m) 1H10 1H09 % change Revenue % Operating EBITDA % Investment property fair value adjustment - (41.8) - Profit after tax, excl. investment property fair value adjustment % Profit after tax, incl. investment property fair value adjustment % Total revenue decreased 0.6% compared to 1H09, largely due to reduction in retail revenue As previously foreshadowed, retail earnings impacted by reversion to dual operator model for duty free business and disruption from construction work in departures area However, retail performance resilient with JR Duty Free performing better than expected Aeronautical revenue remained consistent with 1H09, with lower airfield income from reduced aircraft movements on domestic routes and smaller aircraft on international routes offset by slight increase in passenger volumes Effect of increase in landing charges and passenger service charge scheduled from 1 July 2009 deferred until 1 March 2010 Operating EBITDA remained consistent with 1H09 primarily due to decreased retail revenues offset by lower operating costs 14

15 Financial position Financial position (NZ$m) 1H10 1H09 % change Total borrowings 1, , % Capital expenditure % Total borrowings as at 31 December 2009 of NZ$1,055.4m comprised unsecured bonds of NZ$557.6 million, commercial paper of NZ$72.8 million and bank facility borrowing of NZ$425.0 million Successful NZ$125 million retail bond issue in November 2009 NZ$100 million used to repay bank facility expiring 10 March 2010, the further NZ$25 million to be repaid in February 2010 NZ$25 million private placement of debt raised in August 2009 In December 2009, established a new bilateral NZ$150 million standby facility to refinance a syndicated NZ$100 million standby bank facility maturing 10 March 2010 At 31 December 2009, Auckland Airport had NZ$350 million of committed but undrawn funding lines The A$132.8 million Acquisition was funded by debt, which will reduce by the net proceeds from the Offer Capital expenditure was NZ$27.8 million in 1H10 and expected to be in the range of NZ$60-65 million for full year FY2010, excluding yet to be committed property development 15

16 ACQUISITION OF SHAREHOLDING IN NQ AIRPORTS

17 NQ Airports Acquisition overview On 13 January 2010, Auckland Airport purchased a 24.55% stake in Cairns and Mackay Airports ( NQ Airports ) The other two major NQ Airports shareholders, The Infrastructure Fund (20.03%) and International Infrastructure Fund (49.99%), will remain as shareholders Cairns Airport Australia s seventh busiest airport and main airport servicing Tropical North Queensland 3.7 million passengers in year to 30 June 2009 Key driver is inbound leisure traffic with a secondary driver of business/mining Northern-most international airport on Australia s east coast proximity to Asia provides significant growth opportunities Capacity to grow using existing facilities given current A$200 million domestic terminal redevelopment and excess capacity of the international terminal Mackay Airport A significant Australian regional airport and gateway to Bowen Basin coalfields ~946,000 passengers in the year to 30 June 2009 Key driver is mining/business traffic (Bowen Basin coalfields is Australia s largest coal reserve containing 70% of known coal reserves in Queensland) Secondary driver is tourism given proximity to Whitsunday Islands 17

18 Rationale for NQ Airports Acquisition Shared tourism goals with NQ Airports and access to higher growth international markets especially in Asia Risk diversification as NQ Airports business drivers are different to those for Auckland International Airport Attractive opportunity with good upside potential Regenerating leisure traffic by targeting Australian and Asian low-cost carriers; retail enhancement; longer term property opportunities Opportunity to add value as NQ Airports only airport operator shareholder, with world class expertise in route development, retail and property development Compatible investment partners in The Infrastructure Fund and International Infrastructure Fund Leverage benefits and synergies with Auckland International Airport Including air services development, tourism marketing and increased NZ outbound travel Consistent with Auckland Airport s step-out strategy Asian tourism markets provide the greatest opportunity for international passenger volume growth Key to growing Asian traffic is improved air services connections 18

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