Auckland Airport has reported a significant increase in its underlying profit, which rose by 87% to $276 million, as international traffic rebounded to 91% of pre-COVID levels in the last financial year.
This performance outcome was within the company’s guidance range of $260 million to $280 million.
Meanwhile, the airline reported profit after tax plummeted 87% to $5.5 million for the year ending June 30. The company has indicated that the recovery of passenger numbers to pre-pandemic levels will take longer than initially expected.
“The lift in capacity, particularly on North American routes with a 48% increase in available seats, has not only benefited Kiwis but led to a 40% growth in North American visitors—an important economic driver for New Zealand’s tourism industry,” Auckland Airport chair Patrick Strange said.
“Connectivity with China has been another bright spot with the return of Sichuan Airlines in April. Six airlines now connect Auckland Airport to seven destinations in China, with seat capacity surpassing 2019 levels by 2% for the year while Q4 saw an 13% increase,” he added.
A total of 27 airlines operated non-stop flights between Auckland and 42 international destinations.This marks an improvement from 25 airlines and 40 destinations in 2023.
“The Auckland Airport team has worked hard to bring back airlines to Auckland, supporting them to grow and relaunch services, and that has delivered choice and competitive fares for customers.
“Where there is less capacity and competition on routes, airfares remain stubbornly high, most noticeably across the Tasman. When you couple the higher cost of flying with increased competition from other tourism destinations and the global economic climate, we’ve seen flow-on impacts for key inbound visitor markets. This is especially true for Australia, with fewer Australians choosing New Zealand as their destination.
“Looking ahead, a global backlog of replacement aircraft orders has seen airlines prioritising available fleet on high-yield routes and holding back on a full return to long-haul destinations.
“With these headwinds, we are anticipating a longer time frame for achieving a full capacity recovery to pre-2019 levels.”
Auckland Airport chief executive Carrie Hurihanganui acknowledged that while the 2024 fiscal year saw a significant increase in airline seat capacity, the airport is adopting a prudent approach to cost management due to the prevailing economic conditions.
“Auckland Airport relies on customers coming and going through our doors, so in this environment, where people are being more careful with household spending, we are taking a prudent and careful approach to spending.
“This conscientious approach to cost control extends to our infrastructure programme, with a firm focus on functional, fit-for-purpose facilities delivered in an efficient and cost-effective manner,” she said.
“We’re making positive progress in this regard, and this past year has seen the visible changes underway across the airport precinct: the first stage of the Transport Hub opening and the closure of the inner terminal road; work on our airfield expansion; road network upgrades; and importantly, real progress on the new domestic jet terminal.”
As Auckland Airport continues to navigate challenges in the aviation landscape, its performance serves as a barometer for New Zealand’s economic resilience and potential for future growth in tourism sectors.