Adelaide Airport (AAL) has suffered a fall in profit for 2015/16, despite an increase in revenue.
The airport said net profit after tax fell 15 per cent to $31 million, from $36.5 million in the previous year, with the decline blamed largely on a lower increase in property values.
However, earnings before tax, interest and amortisation – and excluding property valuations – edged ahead from $108 million to $112 million and revenues rose 4.6 per cent to $187.9 million, despite the withdrawal of AirAsia X from Adelaide services, and Jetstar dumping its Adelaide-Auckland service.
That sent international passenger traffic falling 8.3 per cent, according to the airport’s annual report.
Chairman Rob Chapman forecast a better year ahead, following the start of Qatar Airways services in May – just ahead of Adelaide Airport Ltd’s balance date – and the introduction of China Southern’s service between Adelaide and Guangzhou on December 13.
The advent of China Southern’s flights will give Adelaide eight international airline routes and complete the campaign to gain direct services to mainland China. The airport continues to target nonstop services to the US.
After a fall in passenger numbers in the first half of the financial year, traffic picked up in the second half, enabling AAL to post an overall rise of 0.7 per cent for the year to 7.89 million passengers, underpinned by a 1.9 per cent improvement in domestic passenger numbers as a result of incremental airline capacity.
On the revenue split, aeronautical income rose from $88.3 million to $93.6 million, commercial trading income was $46.7 million, up from $45.3 million, and property revenue was $44.7 million, versus $43.2 million previously.
AAL’s solid result enabled the company to increase its special dividend to shareholders from $30 million to $45 million, on top of its slightly higher $21.8 million dividend on its preference shares.
Meanwhile, the airport company said it was advancing negotiations for a hotel near the passenger terminal, as it seeks a developer and operator. AAL managing director Mark Young said directors were “hopeful of resolution” before the end of the calendar year.
AAL was also continuing to plan for the proposed expansion of the 10-year-old passenger terminal, he said.
In another development, the Royal Flying Doctor Service has opened its $13 million aeromedical centre on the western side of the airport, combining operations and administration for the first time. The new hangar has space for parking and maintenance for up to six of the Central Operations Pilatus PC-12 aircraft.
AAL will gain future benefit from plans to build a major shopping centre on its Parafield Airport for general aviation.