Christchurch Airport posts a $64.6m profit thanks to tourism, freight and property development

Tuesday, 5 September 2017

The freight apron at Christchurch airport allows aircraft to taxi up to the Dakota Park freight depots for unloading.

Christchurch Airport's $64.6m net annual profit was up 50 per cent off the back of record passenger numbers, and growing returns from its property portfolio.

Total operating revenue was fairly evenly split between aeronautical ($85.7m) and non-aeronautical ($91.6m).

Christchurch International Airport (CIAL) board chair David Mackenzie said the $38.3m dividend included a special one off payment of $3.5m to reflect the company's strong performance, up from last year's dividend of $31m.

The Christchurch City Council will be the major beneficiary, with 25 per cent going to the Crown.

The airport terminal handled 6.57m passengers for the financial year and Mackenzie said it was well on track to meet its goal of 8.5m passengers annually by 2025.

Christchurch had clawed back some of the market share it had lost to Queenstown after the earthquakes, but it also faced strong competition from Auckland and Wellington for business, Mackenzie said.

CIAL had targeted Australians who wanted to spend a week to 10 days touring the South Island, rather than those wanting a quick skiing or partying weekend in Queenstown, and Australian holiday arrivals into Christchurch grew 9 per cent for the six months to June.

China was another important market with more than 44,000 Chinese passengers passing through the airport last year, and demand had encouraged China Southern to increase capacity by almost 70 per cent over the coming summer.

Mackenzie, who is retiring after nine years on the airport board, said they had made a deliberate decision to invest in property development to act as insurance against the sometimes 'fragile' nature of aviation income which could be upset by fuel price hikes, pandemics, or terror threats.

The company's property portfolio had produced excellent rental returns and three new premises - two restaurants and a beauty salon - were opening at the Spitfire Square retail precinct this month, with the 200 room Novotel hotel due to open early next year. .

E-commerce had led to strong growth in parcel freight through the new freight logistics depot at Dakota Park, Mackenzie said.

The future looked promising in light of Amazon's plans to set up in Australia and the airport company's relationship with e-commerce giant Alibaba to help smaller South Island companies sell to China.

'I can see Christchurch becoming a very important air freight hub.'

Mackenzie said the emphasis was now on increasing international and domestic flights.

'We've decided to push the button a little harder on the aeronautical front.'