Financial Summary

Financial summary

Back to top

Our total profit after tax for the six months to 31 December 2017 was up 17% to $165.9 million, while underlying profit after tax increased 7.8% to $133.1 million.

Revenue increased 6.9% to $332.4 million. A 2.7% increase in aeronautical revenue was driven by passenger growth and increasing runway movements, partly offset by international and regional aeronautical price decreases. Our 10.2% increase in retail income benefited from continued passenger growth also, combined with strong duty free, food and beverage and Strata Lounge performance, while our investment property rental income increased due to the development of new properties, strong growth in the existing portfolio and the performance of the ibis Budget hotel.

Operating expenses increased 9.7% to $82.3 million, in part due to greater asset management, maintenance and airport operations investment. Staff costs increased by 9.6% as a result of the ongoing expansion of our business, with additional headcount largely driven by additional employees in our customer services, emergency and engineering services teams.

Our earnings before interest expense, taxation, depreciation, fair value adjustments and investments in associates (EBITDAFI) increased 6% to $250.1 million.

Our total share of the underlying profit from associates was $11.2 million for the first six months of the 2018 financial year, up 47.4%. The underlying profit share from Queenstown Airport increased 46.7% to $2.2 million and the share from the Novotel hotel was up 120% to $2.2 million. Our underlying profit share from North Queensland Airports grew by 33.3% to $6.8 million.

The interim dividend for the 2018 financial year is up 7.5% to 10.75 cents per share. It will be imputed at the company tax rate of 28% and paid on 5 April 2018 to shareholders who are on the register at the close of business on 20 March 2018. Our performance in the six months to 31 December 2017 means that underlying earnings per share have continued to increase, up 7.3% to 11.1 cents per share.

The table below shows how we reconcile reported profit after tax and underlying profit after tax for the six-month periods ended 31 December 2017 and 31 December 2016.

The following adjustments have been made to show underlying profit after tax for the six-month periods ended 31 December 2017 and 31 December 2016:

  • We have reversed out the impact of revaluations of investment property and associates in the first six months of the 2018 and 2017 financial years. An investor should monitor changes in investment property over time as a measure of growing value. However, a change in one particular period can be too short for the purposes of measuring performance. Changes between periods can be volatile and, consequently, will have an impact on comparisons. Finally, the revaluation is unrealised and, therefore, is not considered when determining dividends in accordance with the dividend policy.
  • We recognise gains or losses in the income statement arising from valuation movements in interest rate derivatives that are not hedge accounted and where the counter-party credit risk on derivatives has an impact on accounting hedging relationships. These gains or losses, as in the case of investment property, are unrealised and derivative gains or losses are expected to reverse out over their lives.
  • To be consistent, we have adjusted the revaluations of investment property and financial derivatives that are contained within the share of profit of associates in the first six months of the 2018 and 2017 financial years.
  • We also allow for the taxation impacts of the above adjustments in the first six months of the 2018 and 2017 financial years.
increase in underlying earnings per share to
11.1 cents per share

Underlying profit

2017 2016
2017Reported profit
Underlying profit
2016Reported profit
Underlying profit
EBITDAFI per income statement 250.1 - 250.1 235.9 - 235.9
Share of profit of associates 4.4 - 4.4 2.6 (0.1) 2.5
Share of profit of associate held for sale 6.7 0.1 6.8 7.4 (2.3) 5.1
Derivative fair value movement (3.0) 3.0 - 1.5 (1.5) -
Investment property fair value increase 41.5 (41.5) - 17.4 (17.4) -
Depreciation (40.7) - (40.7) (37.4) - (37.4)
Interest expense and other finance costs (38.6) - (38.6) (36.8) - (36.8)
Taxation expense (54.5) 5.6 (48.9) (48.8) 3.0 (45.8)
Profit after tax 165.9 (32.8) 133.1 141.8 (18.3) 123.5