Auckland International Airport Limited (AIA)

[minimoke]

Good luck to Christchurch. Are they not aware people now fly direct into Queenstown?


Queenstown is only open for busines during Visual Landing hours and we are getting a new cycle track at the St James walkway so that will drag the punters in.

[Placebo]

Queenstown is only open for busines during Visual Landing hours and we are getting a new cycle track at the St James walkway so that will drag the punters in.

Jealous, much...

[Zito]

Placebo, not wishing to split hairs but Wellington's runway length is 1814m.
Admittedly much shorter than the 3000 odd metres available at Auckland or Christchurch. But I think important to get the numbers right.

[PartTimeTrader]

re entered a small parcel @ 1.70 today, had sold off all my AIA holdings last Friday along with most other shares I held.

I'm not sure whether to commit more to AIA at present. This should be an interesting week for equities after the huge run up past 2 weeks.

[tobo]

What on earth is going on?
why is it rising and more rising?

I cannot interpret the chart: approaching overbought, OBV slightly upwards

[macduffy]

What on earth is going on?
why is it rising and more rising?

I cannot interpret the chart: approaching overbought, OBV slightly upwards

A natural monopoly.

Economic outlook improving.

I doubt that there's anything more to it than that.

:cool:

[Jim]

I always top up my holding when it is on a dip and I have NO exit strategy.

Grabbing food out of the food trolleys as they pass down the aisle just because your own plate is getting low is, to my mind, unnecessarily uncouth behaviour. I am sorry if your food addiction has made you so large that you can no longer move in your seat. But isn't claiming that you have 'no exit strategy' a little defeatest? Could they not just sit you down the back near where the food supplies are forklifted in. Then in the event of an emergency simply roll you out of the XL sized cabin door at the back ;-P?

SNOOPY
I always top up my holding when it is on a dip and I have NO exit strategy.

I pick up a parcel at $1.53

[Phaedrus]

I cannot interpret the chart:What's to interpret? AIA is in an uptrend, has been for 2 months.


approaching overboughtThis means nothing. Uptrending stocks can sit at "overbought" levels for extended periods of time.


OBV slightly upwardsThis is good. It confirms the uptrend.

[COLIN]

I think that the improving sentiment towards the Listed Property market, in general, could be playing a part in AIA's stirring. I have read somewhere, in the last 24 hours, that their occupancy rate has increased to 98%.

[Zito]

With around 94 million shares traded off market at 184 this morning (9c discount to market) further weakness in AIA this week looks likely.

[COLIN]

With around 94 million shares traded off market at 184 this morning (9c discount to market) further weakness in AIA this week looks likely.

That was just IFT selling off, by way of an institutional book-build, to help fund their Shell J/V proposed purchase. It shouldn't have too lasting an effect on the AIA price.

[modandm]

AIA has broken its uptrend line on my chart which begins at 14 july confirming at 16 september and now crossing below the line today.

THERE IS SOME HUGE SELLING GOING ON MASSIVE VOLUME - 170m value already

I noticed there are some favourable broker reports out on the stock
by craigs and I believe by goldman sachs.
can't exactly remeber the details.

Be an interesting share to watch over the next week.

Be great to hear some views on AIA.

[Aeneas]

*DJ Infratil Says Sells Stake In Auckland International Airport

(MORE TO FOLLOW) Dow Jones Newswires
November 09, 2009 14:45 ET (19:45 GMT)
*DJ Infratil: Received NZ$1.84/Shr For 3.87% AIA Stake

(MORE TO FOLLOW) Dow Jones Newswires
November 09, 2009 14:46 ET (19:46 GMT)
*DJ Infratil: Will Post NZ$6M Gain On AIA In FY10

(MORE TO FOLLOW) Dow Jones Newswires
November 09, 2009 14:47 ET (19:47 GMT)
DJ Infratil Sells 3.87% Auckland International Airport Stake

WELLINGTON (Dow Jones)--New Zealand utilities investor Infratil Ltd. (IFT.NZ) said
Tuesday it has sold its 3.87% stake in Auckland International Airport Ltd. (AIA.NZ).
The 47.4 million shares were sold via an institutional placement at NZ$1.84 per share
and raised NZ$87.25 million, the company said in a statement.
Chief Executive Marko Bogoievski said the sale was consistent with recent capital
management initiatives and will provide additional flexibility to fund current and future
opportunities.
Infratil, in consortium with the New Zealand Superannuation Fund, is the exclusive
bidder for a stake in Royal Dutch Shell PLC's (RDSA, RDSB, RDSB.LN) refining and
retail assets in New Zealand.
Infratil said that since March 31, it has divested over NZ$215 million of non-core
assets and raised over NZ$98 million of new capital.
The sale will result in a NZ$6 million gain in the fiscal year ending March, 31, 2010,
Bogoievski said.
Auckland Airport shares closed Monday at NZ$1.93.

-By Simon Louisson, Dow Jones Newswires; 64-4-471-5990; simon.louisson@dowjones.com

Click here to go to Dow Jones NewsPlus, a web front page of today's most important
business and market news, analysis and commentary:
http://www.djnewsplus.com/access/al?rnd=MJzxBhF%2FjzBefbmnV8by9Q%3D%3D. You can use this
link on the day this article is published and the following day.


(END) Dow Jones Newswires
November 09, 2009 15:11 ET (20:11 GMT)
Copyright (c) 2009 Dow Jones & Company, Inc.

Tuesday 10 November 2009 07:11:00.000 AEST

[modandm]

thanks we really needed that giant post...

very weak on very heavy turnover today. I think the comments from IFT are partly to blame. Obviously unloading a big stake like this is a sign IFT don't believe it to be a good investment. Im not sure what value IFT ever thought they were adding to SH's money anyway buying an asset such as AIA which is readily available for ordanairy investors to buy shares in... ditto TPW...not a fan of IFT tbh..

here is the key negative comment from IFT:

The sale of the airport stake was in line with Infratil's signal earlier this year that it was looking to take capital out of some relatively lower prospect investments, while looking to invest in more exciting opportunities, Brown said.

it did say though (perhaps just being polite - and a bit of an afterthought):

Infratil considered Auckland Airport to be a fantastic company and the new owners of the stake would do extremely well from the investment, but Infratil's management had thought it had something better to do with the money.

Perhaps IFT should just have stayed a bit quieter.... a bit embarassing imho

[ratkin]

Im not sure infratil selling shows a lack of confidence in Aucklandd airport.

It is more about Infratils debt

[COLIN]

Im not sure infratil selling shows a lack of confidence in Aucklandd airport.

It is more about Infratils debt

I think you're right, Ratkin.
When IFT initially bought their interest in AIA it was all part of a greater plan. Remember, Lloyd Morrison even got a seat on the Board. And the Canadians were at the gate, but Michael Cullen shooed them off.
But things have moved on, from those days. (By the way, does anyone know the current state of Lloyd's health? I sincerely trust he is making good headway.)

[Dr_Who]

Who bought IFT's stake?

Did it go to one investor or was it a bookbuild?

[COLIN]

Who bought IFT's stake?

Did it go to one investor or was it a bookbuild?

The announcement just said that they were sold "by way of an institutional placement." As nearly $90m was involved I doubt it would just be to one institution.

[macduffy]

The announcement just said that they were sold "by way of an institutional placement." As nearly $90m was involved I doubt it would just be to one institution.

I heard a comment ( sorry, can't remember who) that two brokers were involved in the placement. Likely then that more than one buyer.

[Dr_Who]

Hmmm.. no T/O potential... ok lets move on, nothing else to watch here. :rolleyes:

[BRICKS]

Hmmm.. no T/O potential... ok lets move on, nothing else to watch here. :rolleyes:

NOW that IFT have done the bunk and there are unknowns hanging about someone
may pop out of the woodwork at any TIME..

[Anna Naum]

NOW that IFT have done the bunk and there are unknowns hanging about someone
may pop out of the woodwork at any TIME..

NZ Super I think owns a chunck of AIA (over 5%), cant see them accepting any deal for a takeover.

[whatsup]

EPS 3.5
PE 55, says it all !!!

[macduffy]

EPS 3.5
PE 55, says it all !!!

Well, not really.

AIA's profit last year was adversely affected by massive asset writedowns. But at least they made an NPAT so they can boast an historical P/E. Most major NZ property companies - and that's really what AIA is - were in the same boat or worse, with a loss after tax. So no P/E at all!

Stating the obvious but the market looks ahead in pricing AIA at 55 times historical earnings.

Disc: Holding AIA.

[Anna Naum]

NZ Super I think owns a chunck of AIA (over 5%), cant see them accepting any deal for a takeover.

Morrison & Co just filed with 7.122%, looks like most held within the NZ Super fund that they manage. Between them and the various councils I would suggest this one is not going to disappear anytime soon.

[Balance]

Can anyone name one other good investment IFT has made outside of POT and TPW?

IFT is now the sort of company that you buy from and sell to.

[macduffy]

Can anyone name one other good investment IFT has made outside of POT and TPW?

IFT is now the sort of company that you buy from and sell to.

Well we could start with the investment in Wellington Airport!

But suffice to say that IFT has been a good investment with an average after tax compound return to shareholders of 18%pa since listing in 1994.

;)

[Balance]

Well we could start with the investment in Wellington Airport!

But suffice to say that IFT has been a good investment with an average after tax compound return to shareholders of 18%pa since listing in 1994.

;)

SP today is where it was in 2004. Precisely the point - living on past glories.

When they bought Stage Coach, the market went crazy and sent the sp to $3.00. Good talking.

And we have IFT's word that Wellington airport is a good investment. Is it? Same thing they were saying about the European airports they bought.

[POSSUM THE CAT]

Why Do Shell & Mobil both want to get out of service stations. I would not like to buy IFT shares At the moment

[Toddy]

Why Do Shell & Mobil both want to get out of service stations. I would not like to buy IFT shares At the moment

Because NZ is a pimple far far away. As part of the post recession strategy bigger offshore companys are exiting our big farm.

Barrrrr

[ratkin]

Whats the views of forumites to this expansion?
And how are they paying for it

[macduffy]

We'll need a bit more info to evaluate this!

$166m to buy 24.55% of the company so do we assume they'll be a minority shareholder - or is the other 75% odd well spread?

Will they be able to apply their undoubted expertise in operating these airports? Are they any better than the current owners/managers in this regard?

How is it being financed? Westpac are the vendors. Are they leaving vendor finance in the deal? What are the profit figures for these airports? What capex is around the corner?

Too many questions but at least North Queensland is a growth region and AIA management appear to know their business.

[Billy Boy]

Whats the views of forumites to this expansion?
And how are they paying for it

Thats the Q,
Could be some bridging finance from the Bank for a bit
then out to the market..... yet again.
Will take a few days for the market to get it's pricing in order,
$2 at the moment, down 8.
Sub $2 soon I suspect.
BB :(

[minimoke]

Cairns is a bit of a poxy wee airport but I haven't been to Mackay. Could well be some good potential as Northern Queenstown ramps up. Gold / Sunshine coasts pretty well over-exposed (with 2 airports) so if you're going to fly why not go a bit further north. Could be a bit of money needed on R & M and development though.

[BRICKS]

Hard to say Cains is a POXY airport with a 200 million lounge going in also Cains has a large Navy base to service all round both ports are a good buy but longer term than current
anything connected to airlines will have to wait and see but a good time to BUY..

[minimoke]

Hard to say Cains is a POXY airport with a 200 million lounge going in
Still half the size of Christchurch Airport and we get a new terminal for $200m. So AIA are buying a quarter of a $600m 2 airport businesses - and $200m of that is for a new terminal in one of them?

[BRICKS]

Still half the size of Christchurch Airport and we get a new terminal for $200m. So AIA are buying a quarter of a $600m 2 airport businesses - and $200m of that is for a new terminal in one of them?

Cant compare Christchurch to Cains is AU. 8 th largest and a different market and will get bigger don't forget AU 24 million people, NZ 4 million so it is an up an coming AIRPORT..

[Billy Boy]

I just watched TV ( 1 or 3 dont know) ....Kids are here !!
CEO/ Chairman... what ever.
Quote " Hopefully we can use these points to get more tourists.
DOWN HERE to Auckland."
Mr ? what sort of F**king idiot are you ??
I have spent a lot of time in the tourist industry, and have learned,
Never use a negative in a promotion or on public forums,
DOWN HERE should have been ACCROSS HERE, OVER HERE, etc....
One cant sell a product well when negatives are used.
e.g. "Down to Q,town", should be "Going too", "checking out" , "aim
for", etc....
Up is positive, Down is BAD.
Think about it... "Markerters"
BB

[CJ]

I have just been to Port Douglas (via cairns airport). It is small but is a good gateway. With more flights from Auckland, it will be a real altertive for NZers wanting a beach hoiday rather than going to the islands or the surfers. It could also attact lots of asian tourists.

Cairns is expanding rapidly (lots of housing and resort development) and apparently a few big mines have/are opening in the area which Cairns will be the main service city for.

AIA seems to be hoping it will increase demand for auckland from Asia using Cairns as a stop over - not sure why, wouldn't you just fly direct?

I dont think it can be compared to the airports Infratil has been struggling with since these are already established. The big question is did they get it at the right price and can they get growth out of it.

[macduffy]

Yes, we need to see some numbers to get a better idea of this.

I can see a stopover in Cairns appealing to certain leisure travellers to Asia. As we get older the thought of more than 5 or 6 hours in an aircraft grows less and less attractive and Cairns is an attractive spot for a few days R and R.

[steve fleming]

Yes, we need to see some numbers to get a better idea of this.



Here are some numbers/analysis for you MD - from Huntleys
EPS dilutive but CF positive (given impact of depn)
-----------------------------------------------------------------------

-Auckland Airport announced yesterday that it was acquiring a 24.55% stake in North Queensland Airports (NQA) which owns the Cairns and Macay Airports in Queensland. AIA will pay A$133m (NZ$166m) which will be initially funded by debt with longer term funding mix involving a mixture of debt and equity

-Management does not expect the acquisition to have any material impact on dividend distribution. It however expects to have a dilutive impact on EPS on account of higher funding and depreciation cost.

-Key investors besides AIA in NQA are JP Morgan (49.9%), Hastings managed infrastructure fund (20.12%) and Perron Investments (5.43%). NQA has a gearing of approximately 43%.

-IRR of mid-teen percentages is expected from the deal over the long term. The purchase price including assumed debt works out to an EBITDA multiple of 18.8 times FY09 earnings. The purchase price is slightly above the price paid to the Queensland state government late in 2008.

-The acquisition gives AIA an exposure to the fast growing tourism market in Cairns which is expected to benefit from the rapidly growing Asian market. Great Barrier Reef and West Tropic Rainforests are the main attractions here. Australia has set itself a goal of lifting growth from Asian visitors by 7% p.a. from 2009-2014. This is approximately 2x the growth rate that NZ is hoping to achieve.

-Cairns Airport roughly makes up 75% of the purchase price. It is the seventh busiest airport in Australia with 680,000 international and 3m domestic passengers. Overall passenger numbers since 2003 have grown at 3.1% p.a. supported by solid growth in domestic passengers. International passenger numbers have declined due to a reduction in Japanese tourists.

-The Mackay Airport is a domestic airport and represents 25% of the purchase price. Passenger volumes have more than doubled since 2002 to 946,000 in 2009 benefiting from strong resources demand. Bowen Basin, one of the largest coal mining regions of the world is supporting growth.

-NQA is expected to generate good free cash flows as future capital expenditure requirements are minimal and probably in line with depreciation. NQA’s revenue is 100% unregulated.

-Management expects synergies stemming from air service development and tourism marketing to lift annual passenger numbers at the Auckland Airport by 100,000 within the next 5 years. This should deliver incremental EBITDA of NZ$2-2.3m p.a.

[peat]

...rather a lengthy trading halt !

27 Jan 2010 09:43NZX
27 January 2010NZX Regulation AnnouncementAuckland International Airport Limited (AIA)Trading Halt of SecuritiesNZX Regulation advises that, following the announcement by AucklandInternational Airport Limited (AIA) today at 9.19am, the trading halt placedon AIA Ordinary Shares will remain in place to enable AIA to complete theinstitutional component of its accelerated renounceable entitlement offer.NZXR expects the trading halt will be lifted at commencement of trading onTuesday, 2 February 2010.ENDSEnd CA:00190552 For:AIA Type:HALT Time:2010-01-27:09:43:23

and in further news


Auckland International Airport has announced a NZ$126.4m share offer to shareholders to help pay for an almost quarter stake in two Queensland airports bought earlier this month.
The shares, of which subscribers can apply for one per 16 they already own, will be available fromFebruary 1, at NZ$1.65 each. On January 13, the airport bought a 24.55 percent stake in Cairns and Mackay airports in Queensland. The company had used its existing debt facilities to pay for the purchase, it said. Auckland Airport chairman Tony Frankham said today the company's credit rating and outlook were unaffected by the acquisition.

[Lawso]

Rather a niggardly discount IMO, given that the market price is around 192. Still, given that AIA was around 280 a year ago, I spose 165 is not too bad. AIA is my biggest NZX holding so I'll certainly be going for my full quota

[macduffy]

Yes, it's one of my bigger NZX holdings too but I'm happy for them to raise the capital at the highest possible price. It's not a large issue at 1 for 16 but there may still be some pressure on existing shares and some buying opportunites. I'll look hard at buying there too, given the chance.

:cool:

[Lawso]

Fair comment, macduffy. 1 for 16 means minimal dilution which should help to hold up the share price. And there may well be buying opp's when trading resumes.

[Year of the Tiger]

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10622728
Ratepayers face $28m bill for Oz airport deal

By Andrew Koubaridis

4:00 AM Thursday Jan 28, 2010



http://media.nzherald.co.nz/webcontent/image/jpg/AucklandAirport_220x147.jpg Auckland City Council has a 12.71 per cent holding, while Manukau's is 10.01 per cent. Photo / NZ Herald



Auckland City and Manukau ratepayers will foot a $28 million bill as their councils move to secure their stakes in Auckland Airport.
The cities' cash injection is the result of the airport company's announcement yesterday of its plans to issue new shares worth $126 million to help pay for its purchase of a 24.55 per cent stake in Cairns and Mackay airports in Queensland.
Auckland City Council has a 12.71 per cent holding in the airport at Mangere. Manukau's is 10.01 per cent.
To maintain those stakes, Auckland City needs to spend $16 million and Manukau $12.66 million buying extra shares.
Both councils will cease to exist in November when the Super City is formed, but council leaders yesterday said the new investment was necessary to retain ownership of a key asset.
Manukau Mayor Len Brown said the decision meant his city's shareholding stayed at more than 10 per cent and would not be able to be bought out in any takeover attempt.
"Failure to take up the offer would, in effect, be selling down of the council's stake," he said. "Our shareholding enables us to continue to have a say in the direction and development of the company ... On pure commercial grounds it is the right decision. The company is a quality asset which returns good dividends."
Auckland City Mayor John Banks said the airport was a "critically important" piece of infrastructure and would be a significant player in New Zealand's future foreign exchange earnings and inbound tourism.
Local Government Minister Rodney Hide said the arrival of the Super City would not stop council investment in commercial business ventures.
But changes to the Local Government Act, planned for this year, would direct them to concentrate on their core functions, "which I think will be a great relief to taxpayers".
Mr Hide said his opinion of the airport share purchases "doesn't matter", but the spend-up "highlights why we need to be focusing local councils on their core functions, rather than investing in commercial ventures".
Auckland City finance chairman Doug Armstrong said that after November 1, it would be up to the new Auckland CouTncil to determine future policy on the airport shareholding.

____________________________

YOTT

[Year of the Tiger]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10622673

Airport share offer gets tick
By Adam Bennett

4:00 AM Thursday Jan 28, 2010



http://media.nzherald.co.nz/webcontent/image/jpg/Airport_220x14753949.jpg (http://javascript<b></b>:ExpandArticleImage();)


Auckland International Airport's $126.4 million equity raising announced yesterday has won the thumbs up from the Shareholders Association for the way it allows even those retail investors who don't take part to benefit.
AIA said the cash raised in the one-for-16 pro rata entitlement offer would be used to repay a portion of the debt drawn down to pay for its $166.7 million acquisition of 24.55 per cent in Cairns and Mackay airports in Queensland which was announced two weeks ago.
The structure of the offer, which is fully underwritten by joint lead managers Credit Suisse Australia and First NZ Capital, while common in Australia, was a first in the New Zealand market, AIA chief financial officer Simon Robinson said.
Any entitlements not taken up in the institutional pro rata offer or the subsequent retail offer would be offered to other investors in two separate bookbuilds.
Any premium over the $1.65 exercise price achieved in the bookbuild would go the original holder of the entitlements.
"What this means is our joint lead managers will sell those entitlements on behalf of those shareholders," said Robinson.


The offer benefited Auckland Airport as it expedited the institutional part of the offer and it also helped shareholders who could not participate to capture the value of their entitlements without incurring brokerage charges which might otherwise eat into the value of the entitlements for holders of small stakes.
The Shareholders Association's Bruce Sheppard was not convinced of the wisdom of the Cairns and Mackay acquisition or the need to issue new equity to fund it, given the company's relatively strong balance sheet.
However, the structure of the offer was good even for the most unsophisticated retail investor.
"If you are stupid and you don't exercise your rights you at least get what the market for tradeable rights would have created or more. At the end of that process, all of those who did nothing get a share of the booty. It can't be fairer than that."
Auckland City Council has a 12.71 per cent stake in the airport and Manukau City Council has 10.01 per cent. Auckland City Council said it will finance the purchase of its entitlement through debt of about $16 million. Manukau said it will cost $12.66 million to maintain its stake. NZ Super fund, which has a 9.75 per cent stake, has not said if it will take up its entitlement.
Auckland Airport shares closed at $1.92 yesterday.

__________

YOTT

[rainey]

I may be missing something, but I fail to see the logic that owning shares in a couple of Aus airports can increase tourist traffic to NZ. If the holding was in a tour company or an airline, it may be a slightly different matter, but in an airport?

[macduffy]

I think the theory is that they may be able to encourage more of the overseas tourists to North Queensland to include NZ as a "round trip" destination. Possibly by offering incentives to more airlines to fly Cairns to Auckland?

Bit of a long bow, I must agree. The real rationale might be that AIA is an efficient airport operator and sees a business oppportunity in NQ. Helps to sell the idea to everyone if dressed up as also being in the national interest.

;)

Disc: Holding AIA and will buy more on any weakness.

[Billy Boy]

I may be missing something, but I fail to see the logic that owning shares in a couple of Aus airports can increase tourist traffic to NZ. If the holding was in a tour company or an airline, it may be a slightly different matter, but in an airport?

I agree
A bit more NZ advertising in the terminials is about all.

[PhaedrusFollower]

Billy Boy and Rainey,

Consider this:

AIA will work with the airlines to promote new routes via Cairns. They have people specifically engaged for this purpose. So say for example, the create a route Auckland, Cairns, Singapore they will be able to influence Cairns airports pricing for landing charges for planes heading to Auckland. Without the stake in Cairns this would be an uphill battle.
New routes = more passengers in both airports = higher landing charges = $.

It's all about getting more planes landing more often at each airport - routes are developed by the Airlines AND the Airports. Jetstar coming to NZ is an example of this sort of deal.

PF.

[777]

I have heard that the CEO is going to be on the Breakfast program tomorrow, 29/1/10, on TV1.

[POSSUM THE CAT]

Remember the Canadian Pension Fund one of their reasons for buying was to use AIA's expertise in developing airport land & airport retailing for other airports they held shares in or were considering buying into.

[Billy Boy]

Billy Boy and Rainey,

Consider this:

AIA will work with the airlines to promote new routes via Cairns. They have people specifically engaged for this purpose. So say for example, the create a route Auckland, Cairns, Singapore they will be able to influence Cairns airports pricing for landing charges for planes heading to Auckland. Without the stake in Cairns this would be an uphill battle.
New routes = more passengers in both airports = higher landing charges = $.


PF.
I hear what you are saying.
But it is the airlines that dictate where they fly.
If the passengers dont want the option you suggest
then the airlines wont use it regardless of the landing fees.
eg If I am in Singapore, I want to fly direct to Ak with no
stopovers. [ Maybe]
Now this debate can be batted all round the park from
different angles. The risk is .... will the gamble work and
for how long. (compeditors etc...) There's gotta be more to it.
BB:)

[moimoi]

I'm with Rainey and BB on this...i can't see how they'll boost traffic to NZ, particularly as junior 25% shareholders. I'd say that the majority of travellers perceptions of airports is that they are a drag, why they would want to stop into another one to get here, well...i can't see it.

I also wonder why the need for a capital raise for what seems a relatively minor purchase...i wonder if this was in fact a bank stipulated requirement suggesting that the numbers may not look so good on the inside.

Moi :-)

[percy]

All to do with airlines utilising aircraft.Airline routes.ie Emirates fly from asia to sydney to chCH then ch ch to sydney then asia.means they have added tasman route .that's another route using the same aircraft. should auck get more airlines to do cairns auck as an add on means more landings.A lot of airline routes try to get business traveller.flight may start at melbourne ,then sydney then auck then sydney then back to melbourne.

[Jim]

I remember when John Banks was the one who tried to sell off all AIA shares and he said that the council is to look after Auckland city and not be running a big share holding in AIA. Now Mr. Banks is saying that it is a "critically important" piece of infrastructure. Comments.

[macduffy]

Yes, the fear was that the Canadians would sell off the airport land for housing!

Or worse, pick it up and take it away!

Enough said.

:D

[CJ]

Hasn't MCC said they need to maintain a over 10% holding to stop a takeover. Are they forgetting they wont exist in a year and combined with ACC, they will have a over 10% holding without further purchase.

Did they use their 'strategic holding' to voice concern over the expansion into Australia. If not, why not, and if it is because they would ahve been ignored, is it really a strategic holding.

[BRICKS]

They have just realised they own something "GOOD" and have nearly frown it out many times they are not investors and run by public servants who have own nothing personally
in the stock market the worst of it they are borrowing the money for the rate payers to suffer WITH for a long time...

[Silverlight]

Completion of Institutional Bookbuild

Auckland International Airport (“Auckland Airport”) advises that it has successfully completed the institutional bookbuild component of its 1 for 16 fully underwritten entitlement offer (“Institutional Bookbuild”). This represents the second stage of Auckland Airport’s approximately NZ$126.4 million equity raising, announced on 27 January 2010 (“Offer”).

The Institutional Bookbuild was well supported, attracting bids from both new and existing New Zealand, Australian and international investors. The clearing price under the Institutional Bookbuild was NZ$1.91 per share.


Assuming the retail offer goes the same way, and you decide not to subscribe for your shares you will receive the 26 cent difference, which is about 1.625 cps, basically a dividend.

[ratkin]

Interesting , if the market keeps falling then might be better in the shortterm to take the cash.
I shall be going for the shares , have been considering topping up lately anyway

[Lawso]

Wot's gonna happen to the price when trading resumes tomorrow? Good chance to pick up more, d'ya reckon?

[macduffy]

Hmm.....

Brian Gaynor this morning was less than enthusiastic about AIA's Nth Qld purchase.

I still reckon AIA is one of our better stocks but we may see them trade down a bit today.

[ratkin]

Market seems to like AIA today. Was a good time to have a trading halt , missed all the down days and then reopens up four cents

[Lawso]

Certain posters have questioned my mathematical skills in the past, usually with good reason. But how does the following stack up?
The day after the record date for AIA's share offer, I sold 1000 of my holding for 195cps, realising $1920.10 net. Now I can buy my full entitlement of 1839 new shares @ the offer price of 165cps - cost $3034.35.
Using round $s, $3034 minus $1920 = $1114 cost. I will then hold 839 shares more than I had before and I figure they will have cost me not 165cps but 132.7cps!!
What a bargain!

[winner69]

Probably more the logic than the maths

Using the same maths with the same ogic one could say you have missed out on a bargain mate .... you could have got 300 FREE (ie cost = zilch) shares if you had sold 1,555 shares (instead of 1,000) and then bought the 1839 at $1.65

Whatever way you look at it the 1,839 you get at 1.65 are worth more that at todays price .... well done

PS - on reflection you can still get those free shares

[ratkin]

No , it the maths

[Snoopy]

I remember when John Banks was the one who tried to sell off all AIA shares and he said that the council is to look after Auckland city and not be running a big share holding in AIA. Now Mr. Banks is saying that it is a "critically important" piece of infrastructure. Comments.

If it is critical I hope that AIA can do better than this. Here is a reprint of the relevant paragraphs from my rather longer exposition on the THL thread

--------------

It took more than half an hour between when my Jetstar flight from Christchurch landed and when the baggage was stuck on the carousel. And I am not just talking about my luggage: half the plane had to wait that long. I have no idea what happened, but I have never seen the baggage collection process so slow, and that includes from international flights and much larger planes. I don't know whether to blame Jetstar or AIA for that, but AIA I think must share some of the blame for what happened next.

Having 'missed' (after being given the wrong timetable) my free shuttle, I went to the taxi rank. I was told that the 3.5km trip to THL's Auckland Airport branch was subject to a $30 minimum charge! Even a cabby in a traffic jam in London would not charge those rates. I can see the cabby's perspective of sitting on the rank for an hour and only getting a short trip. Perhaps AIA should set up a special short haul taxi rank? I understand that getting a cab to any hotel in the immediate vicinity of Auckland Airport would have cost the same.

Either way, this seems a sure way to give overseas visitors a sour taste of NZ service as soon as they get off the plane if nothing is done. The rejected cab driver then waved me in the direction of a shuttle who tried to charge me $15 for the same trip, before we eventually settled on $10. One thing I can say about these transportation arguments is that by the time the negotiations were over, my luggage had at last arrived off the plane. And that saved me from going back and picking it up later.

---------

SNOOPY

[ratkin]

30 dollar taxi ride may seem a lot to you , but for most foreign visitors they would see nothing out of the ordinary about it.

[BRICKS]

THERE buy of AUSTRALIAN real estate will grow faster in real terms than AUCKLAND
the AU dollar make more NZ$ they are in a bigger market which will grow faster, AU has 22 million people and soon will be 25 MILLION.. REST my CASE...

[Snoopy]

30 dollar taxi ride may seem a lot to you , but for most foreign visitors they would see nothing out of the ordinary about it.


$30 to travel 3.5km? I think most overseas tourists would notice it was a rip off. Of course thinking about it again, I should probably have gone to the back of the taxi rank and got a driver who had just arrived. One who hasn't built up a 'time bank' which needs a return. There is no compulsion to take the cab off the front of the rank and if drviers have no sense of fair play, then why should I?

Then again I presume a taxi driver in Auckland has to pay something to AIA to park at the airport. I would be very curious to know what that charge is. If that charge is $20 then perhaps the taxi drivers have a point with only offering fixed charge fares. Anyone know what the charge is?

SNOOPY

[peat]

snoopy does this really relate to AIA in any but the most abstract of ways?

[percy]

Hi snoopy.
my daughter arrived safely in paris.she was pleased her luggage arrived two days later.
A few years ago a bus delivered me to domestic terminal rather than international at Brisbane airport.A taxi wanted to charge me $30 to go to international. so you are not alone.I still get upset with airport loading airport rental firms charge.I now use Apex who pick you up at the airport and have their base just down the road.Donot get me started on trying to change flight times with airlines.I hate them all.AS for airport security at Sydney I go ape!!

[percy]

snoopy does this really relate to AIA in any but the most abstract of ways?

Sorry peat I too got off the subject.Think bricks has a point about aussie airport growth. I would like to go back to Cairns,would do it via Auckland,
but not Sydney after a poor no brain security making middle age and old age take off shoes and belts.Rock apes.

[macduffy]

snoopy does this really relate to AIA in any but the most abstract of ways?

It's hardly abstract.

AIA's income from airport services including rentals on retail outlets, parking, access charges to taxis, etc exceeds their income from aircraft movements!

AIA is essentially a property company.

[peat]

well sure it is a property company and its one that exploits its monopolistic situation to the hilt and this annoys me too when I'm forced to buy food out there etc - but I always find anecdotal comments that relate to large public companies annoying in this context
They're irrelevant and I think ultimately pointless.
Be a fundamental analyst or be a technical analyst but one person voting with their feet is not really 'discussing' a company.

Wasnt there a passenger count out today? now thats information.

And although I'm bearish in general on equities, using the Ichi Moku analysis that arco is famous for we can see on this weekly chart of AIA that price is above the cloud which is turning bullish in the future and showing support in the 1.80 region. We'd need to watch out for weakness in April (where the cloud is at its thinnest) though given we've had RSI divergence at the recent highs

[Snoopy]

Snoopy does this really relate to AIA in any but the most abstract of ways?


Peat, I posted my experience because I have seen many examples of New Zealand companies going to Australia (as AIA has now done with their Queensland Airport partial purchases), while neglecting their core businesses at home. I think it is a fair -underlying- question to ask whether AIA are really on their game at home, before that export their management expertise to Australia.

Perhaps the baggage handling delays I experienced were nothing to do with AIA? Perhaps it is because they are now X-raying every suitcase that come off all jets even on domestic flights, because some of those passengers might be transferring to international? Perhaps the delay was due to a one off equipment break down? Perhaps if I post here I will find out if my experience was atypical or not?

All I know is most people don't want to hang out airports. But they recognise going to the airport is a necessary part of the flying process.

Airports can best serve the consumer by making the process of going through the airport gateway as painless as possible. That means keeping queues to a minimum, yet having enough people space where crowds are unavoidable. It means having adequate signage and providing a polite and efficient consumer experience in all customer/staff interactions. I personally find it difficult to have a polite conversation when it is obvious the other party is grossly overcharging for a product or service. I used to avoid eating at airports because the food was always bad and overpriced. These days I find Airport food much more palatable and relatively affordable. I wouldn't go to an airport to dine, but I wouldn't avoid it, like I did in the past, either.

Why should taxi rides be massively more expensive locally at the Airport than taking the same ride in downtown Auckland? One reason *could* be that AIA *know* they have a captive market and slug taxi drivers with parking charges so high they have to be passed on to the consumer. Perhaps AIA doesn't worry about it because they know it is the taxi drivers who will get any backlash, not them.

All I know is that what with the baggage delays and problems with transportation, I left AIA hot and bothered and glad to get out of the place. I have never felt that way coming out of Wellington or Christchurch Airport. So why should going through Auckland Airport be such a relatively aggrevating experience? My hunch is that it was Auckland Airport that was really behind my aggrevation and not the frontmen: Jetstar and the Taxi companies.

Abstract? I would argue that the core gateway experience is what AIA is all about from the public perspective. And if AIA are not providing the core support to Jetstar and the taxi companies allow them to give a reliable service at a fair price to the end consumer, then IMO this is a serious core issue for Auckland Airport shareholders.

SNOOPY

discl: Do not hold AIA

[peat]

i re-iterate my view that personal anecdotal experiences are quite worthless in analysis of large organisations. they may possibly represent a common theme but if we think statistically then they dont constitute a sufficient sample.

whereas the numbers that were published today say that traffic volumes are holding up see link and picture attached

http://file.nzx.com/000/589/3296589.pdf


also to be frank I question whether the travellers satisfaction is even a factor here. the traveller may generate the need for an airport but in situations where the traveller has no choice or alternative then their experience (enjoyable or not) isnt hugely relevant. AIA customers are the airlines and the retailers.


but its a forum so hey I guess we say what think.... (and its a slow day here for me)

[ratkin]

Christchurch has to be the least stressful international getaway point imaginable . So easy and painless. Always fly singapore airlines so can go direct from chch thus avoiding Auckland

Airport quality very important to me. Every year i go to Cornwall for a few months , and always fly to schipol , then a flybe flight to Exeter.
Dutch think thats a weird way to go , however i avoid heathrow at almost any cost.

So i guess what im saying is that if an airport is bad enough people will go out of their way to avoid it.
Monopoly or not , people will find other routes if their experiences are bad

[Anna Naum]

[QUOTE=Snoopy;292106]

Perhaps the baggage handling delays I experienced were nothing to do with AIA? Perhaps it is because they are now X-raying every suitcase that come off all jets even on domestic flights, because some of those passengers might be transferring to international? Perhaps the delay was due to a one off equipment break down? Perhaps if I post here I will find out if my experience was atypical or not?

Over the last two years I have used AIA baggage services on numerous occasions and nearly always have experienced delays. On the 3 occasions I have enquired as to the reason I was told that other aircraft had recently arrived.

Real answer is I guess, we are a monopoly, therefore what are you going to do about it!!

[minimoke]

Peat, I posted my experience because I have seen many examples of New Zealand companies going to Australia (as AIA has now done with their Queensland Airport partial purchases), while neglecting their core businesses at home. I think it is a fair -underlying- question to ask whether AIA are really on their game at home, before that export their management expertise to Australia.


Snoopy. As Macduffy has pointed out AIA is essentially a property management company. Its got 1500 hectares of land which its making money from - most of it a monopolistic environment.

Your bagage handling woes might be down to AIA infrastructure problems (like bad conveyor belts) or it might be down to Customs department problems, security problems or baggage handling problems - all of which are done by someone else.


AIA doesn't provide food - it provides space for food sellers to set up shop and sell their grub to you. Ideally AIA need food sellers who can sell you food - that way they stay at the airport paying their concession / rental. But even if they can't sell you food AIA still gets its rental.


AIA don't provide taxi services. They tender this out and the companies pay AIA for the privilege of parking a cab at the terminal doors. Their doesn't seem to be a shortage of companies wanting that space so AIA will keep hauling in the dollars there. Taxi fares are expensive because its the taxi companies that have an effective oligopoly. Who would be prepared to walk to the airports boundary to pick up a cheaper cab?

Airports, by the simple nature of their function are not a destination - they are a place you have to go through. Though AIA is trying to turn it into a destination with the retail shops outside the terminals being set up - that makes good use of their surplus land. There’s nearly 20,000 people work out at the airport and very few of them are AIA.

I suspect your gripe is really with the airline and taxis. From experience I know AIR are just shockers at letting their customers know about delays - when it comes to handling a problem like delayed flight due to weather they couldn't organise a piss up in a brewery. The people to really blame are the Americans and the FAA. Its them that keeps imposing stricter restrictions on baggage (either cabin or hold/freight) that is creating the problems – and every time they just keep pandering to the terrorists. These people don’t blow up a federal building every day why the tight security with flights?

[Snoopy]

Snoopy.
I suspect your gripe is really with the airline and taxis. From experience I know AIR are just shockers at letting their customers know about delays - when it comes to handling a problem like delayed flight due to weather they couldn't organise a piss up in a brewery.


Jetstar arrived dead on time Minimoke. If you walked outside the Jetstar/Pacific Blue terminal you could see the tail of the aircraft just 50m away. There was no problem with the conveyor belt. It was moving but no more luggage was being put on it. My (and half the passenger's) delay was caused entirely due to baggage handling. I don't think Jetstar engineer the conveyor belts. Anna N has since commented on baggage handling delays at AIA, so it appears my experience was not totally unique. Maybe Aucklanders who only use Auckland Airport don't have the experience to know that things can be better?

My best ever experience with luggage goes back to Ansett and the Whisper Jet days. There you would regularly get off the plane in Christchurch and Wellington to find your luggage had beaten you to the carousel. I don't expect that kind of service again. But half an hour (literally) waiting just to pick up your bag from a national flight is just way too long.



Your baggage handling woes might be down to AIA infrastructure problems (like bad conveyor belts) or it might be down to Customs department problems, security problems or baggage handling problems - all of which are done by someone else.

AIA don't provide taxi services. They tender this out and the companies pay AIA for the privilege of parking a cab at the terminal doors. Their doesn't seem to be a shortage of companies wanting that space so AIA will keep hauling in the dollars there. Taxi fares are expensive because its the taxi companies that have an effective oligopoly. Who would be prepared to walk to the airports boundary to pick up a cheaper cab?


I don't go for absolving yourself of responsibility by outsourcing. It is the company AIA that sets the performance parameters that the contractors must meet. AIA carries ultimate performance responsibility.



As Macduffy has pointed out AIA is essentially a property management company. Its got 1500 hectares of land which its making money from - most of it a monopolistic environment.

AIA doesn't provide food - it provides space for food sellers to set up shop and sell their grub to you. Ideally AIA need food sellers who can sell you food - that way they stay at the airport paying their concession / rental. But even if they can't sell you food AIA still gets its rental.


The key word is "food sellers" (plural). If you the consumer don't like what one AIA cafe operator serves up, you can check out the results of a rival kitchen. There is little such choice at AIA if you don't like the baggage handling or taxi service.



The people to really blame are the Americans and the FAA. Its them that keeps imposing stricter restrictions on baggage (either cabin or hold/freight) that is creating the problems – and every time they just keep pandering to the terrorists. These people don’t blow up a federal building every day why the tight security with flights?


The answer of course is that although the chance of a terroist attack is slight, the consequences could be catastrophic. You can't ignore a small risk if the costs of an adverse event are very high.

Yes perhaps the FAA are to blame. But what extra requirements have come in since the last terroist scare? I don't know what the new requirements are. But wouldn't it make sense do any extra checking on the baggage *before* it goes on the plane rather than after it comes off?

SNOOPY

[COLIN]

Well, I am dumbfounded! The global markets are in a significant crisis of confidence, investors on ST and all over the place are flaying around for guidance as to appropriate strategies to apply in the current climate, and here we have two pages of chatter about someone experiencing a bit of a delay at an airport (what's new about that!) It all reminds me of Nero fiddling while Rome burnt.

But, on second thoughts, perhaps it is a coping strategy - a sedative to deaden the pain of having to face up to wealth depletion. So, keep it up chaps!

[Jaa]

A bit of a storm in a teacup but an interesting discussion as it gets to the heart of both AIA's and the airline business.

Last time I asked, individual taxi drivers had to pay $4,000 a year to be able to pick up passengers from AIA (anyone can drop off), have cars of a certain standard (ford/holden basically - which is silly as AIA should be trying to reduce carbon emissions wherever possible to reassure environmentally conscious Europeans) and follow a set of rules designed to maximise AIA's profit. Thus no cheap cabs or economy taxis in the ranks. So, don't blame the taxi drivers for the $30 fee, its an AIA racket.

As a monopoly AIA can get away with this stuff for quite a while but NOT for ever. I see the situation as similar to Telecom where the poor cow was milked so hard the government had to intervene. The obvious threat to AIA is the Whenuapai airport but just as dangerous would be a modern electrified rail link.

As for the baggage handling issue, this one has history and is entirely Jetstar's fault. Qantas domestic used to use Air NZ's baggage handlers and still do internationally however Jetstar deemed these too expensive and outsourced their services to a completely new crowd with no prior presence in Auckland. This caused many of the debacles during Jetstar's first few weeks as the new staff learned on the job. It would be safe to assume that this new crowd is cheaper because they cut corners in staff numbers/training/pay/conditions etc and hence your delays which are quite common for Jetstar flights. Otherwise Air NZ's economies of scale would have given them an advantage.

If you value your time, fly Air NZ. From check-in to baggage collection you will save time as they do everything they can to manage the whole experience. Jetstar doesn't and it shows.

[peat]

read the NBR in the weekend... this company has a P/E of 58!!!

from what I know thats meant to imply massive growth expectations , or of course just utter pie in the sky territory.

again I guess it has something to do with it being a property company in that expected profits will be revals rather than cash flow profits.

[macduffy]

I think the market's looking beyond NBR's number based on last year's NPAT of $41.7m divided by the number of shares, post the current issue, of around 1,298m.

Last year's NPAT was after a downward revaluation of property of $64.5m, which arguably won't be repeated this year. A "normalised" profit of around $106m - it was $123m the previous year - would indicate a prospective P/E of around 20. A modest upward revaluation of property, not out of the question, would obviously reduce the P/E further.

[Snoopy]

read the NBR in the weekend... this company has a P/E of 58!!!

from what I know thats meant to imply massive growth expectations , or of course just utter pie in the sky territory.

again I guess it has something to do with it being a property company in that expected profits will be revals rather than cash flow profits.


Peat, that historical PE of 58 probably reflects the one off credit crunch 2009 property portfolio write down of $64.2m. The operational profit for AIA was $105.9m for FY2009. That equates to earnings per share, taking into account the current 1:16 share issue of:

($105.9m)/[ 1,225m (17/16)] = 8.14cps

Based on a share price of $1.93, that gives an historical PE ratio of 23.7. That is still high, but not quite the 'pie in the sky' high 58 that is the spreadsheet generated figure quoted in the NBR.

In the past land and property revaluations have not been included in the accounted for profit. However, the internatioanl accounting standards now used mean that in the future (and in FY2009) property gains and losses do need to be brought through to the bottom line. But since AIA is not planning to sell their development property all this does is distort the bottom line reported profit and make year by year profit comparisons difficult.

SNOOPY

[peat]

thanks guys for those excellent explanations....

[Snoopy]

A bit of a storm in a teacup but an interesting discussion as it gets to the heart of both AIA's and the airline business.

Last time I asked, individual taxi drivers had to pay $4,000 a year to be able to pick up passengers from AIA (anyone can drop off), have cars of a certain standard (ford/holden basically - which is silly as AIA should be trying to reduce carbon emissions wherever possible to reassure environmentally conscious Europeans) and follow a set of rules designed to maximise AIA's profit. Thus no cheap cabs or economy taxis in the ranks. So, don't blame the taxi drivers for the $30 fee, its an AIA racket.


$4,000 a year as pick up fee licence!!!! That makes me almost feel sorry for the taxi driver hanging out for his $30 minimum fare. I guess the driver could make sure he has an LPG cab to satisfy those Europeans' environmental consciousness.



As for the baggage handling issue, this one has history and is entirely Jetstar's fault. Qantas domestic used to use Air NZ's baggage handlers and still do internationally however Jetstar deemed these too expensive and outsourced their services to a completely new crowd with no prior presence in Auckland. This caused many of the debacles during Jetstar's first few weeks as the new staff learned on the job. It would be safe to assume that this new crowd is cheaper because they cut corners in staff numbers/training/pay/conditions etc and hence your delays which are quite common for Jetstar flights. Otherwise Air NZ's economies of scale would have given them an advantage.


Somewhere in the back of my mind I did know that the airlines were responsible for their own baggage handling. Looks like AIA is off the hook for that one. Thanks for the info Jaa.

SNOOPY

[minimoke]

The answer of course is that although the chance of a terroist attack is slight, the consequences could be catastrophic. You can't ignore a small risk if the costs of an adverse event are very high.

The chance of an in-flight terrorist attack, despite media and movie attention, is pretty much non existent. I'd argue that the consequence of the security changes are more catastophic than any likely attack and AIA and NZ, could do a lot better if we ignored the security requirements - which of course the FAA won't let us.

Take AIA with 13m passenger movements a year. Say the security adds an extra 15 minutes to the time it takes to process a passenger and the cost to that individual is $1 a minute. Thats $195m in lost human productivity out of one airport in one year. Thats about half of AIA's revenue.

[macduffy]

Thats about half of AIA's revenue.

But hardly AIA's fault. And not sure what the point is in relating it to AIA's revenue? That theoretical cost doesn't accrue to AIA as revenue.

[minimoke]

[php] And not sure what the point is in relating it to AIA's revenue?
If we didn't have the excessive security measures Snoopys trip would have been more enjoyable and he would be more likely to fly again. Fly again = more revenue to AIA. Furthermore he would be more productive, potentially creating more income which he would be able to spend flying - more income to AIA.

If we didn't have those security measures flights would be cheaper, making air travel even more accesible. AIA wouldn't have to spend money on building concourses to hold passengers milling around waiting for security. More money in the passengers pockets = more flights or more discretionary cash to spend in food halls, which no doubt pay a % of income to AIA,

Security is a significant expence for which there is no corresponding return.

[beacon]

Security is a significant expence for which there is no corresponding return.

... except to the security industry. By now, it should be the fastest growing industry in the world...

[minimoke]

... except to the security industry. By now, it should be the fastest growing industry in the world...
Well, in NZ at least its a good way to recycle retired armed forces / Police personnel.

[PhaedrusFollower]

Just received the Dividend reinvestment offer from AIA. 2.5% discount is on offer...

I'm very interested to hear other sharetradee's thought process which makes them decide to participate or not in a reinvestment plan - to help me make a more informed decision.

So far, my brain says... if you take the dividend, you get to decide if you want to buy more AIA shares at the time or at a later date (perhaps during a dip) - the costs for this decision are: Brokerage and 2.5% of today's share price....

Love to hear your opinions on why you would or wouldn't opt into a dividend reinvestment plan.

Thanks

PF

[peat]

Just received the Dividend reinvestment offer from AIA. 2.5% discount is on offer...

I'm very interested to hear other sharetradee's thought process which makes them decide to participate or not in a reinvestment plan - to help me make a more informed decision.

So far, my brain says... if you take the dividend, you get to decide if you want to buy more AIA shares at the time or at a later date (perhaps during a dip) - the costs for this decision are: Brokerage and 2.5% of today's share price....

Love to hear your opinions on why you would or wouldn't opt into a dividend reinvestment plan.

Thanks

PF

someone did this thread years ago which didnt get too many answers

http://www.sharetrader.co.nz/showthread.php?2819-your-thoughts-please-on-dividend-reinvestment-plan&p=2819&highlight=reinvestment

I found it using the search feature

[minimoke]

Love to hear your opinions on why you would or wouldn't opt into a dividend reinvestment plan.


If I'm holding then I have faith the co will continue to do well so I generally go for reinvestment when offered. Saves me brokerage fees for a top up and prevents me heading to the wine shop with a dividend cheque.

[macduffy]

It's very much a "personal circumstances" thing, IMO.

A lot of - particularly older - investors rely on the dividend income so will take the cash.

My own approach is to normally take the reinvestment option on the premise that if I'm happy to hold that stock I'm happy to add to it, particularly if there's a discount offered.

A further point is that "odd lots" aren't usually an issue when selling these days - unlike the time when selling an odd number incurred an additional brokerage cost.

[percy]

.


My own approach is to normally take the reinvestment option on the premise that if I'm happy to hold that stock I'm happy to add to it, particularly if there's a discount offered.

A further point is that "odd lots" aren't usually an issue when selling these days - unlike the time when selling an odd number incurred an additional brokerage cost.[/QUOTE]
I allways take div reinvestment,feel like it is compounding my share value,and makes me save rather than spending it.
I would point out it has been very much the wrong thing to do with my NPX and PGC shares,both of which fell away after divie was announced.

[quartzpurple]

Guys,

Companies who initiate dividend reinvestment are likely to be strained in their cash position. It is just a sugar-coated way of not cutting your dividend outright.

They pay you the dividend but take it back with this scheme called "dividend reinvestment". If you refer to the cash flow statement, cash flow after paying dividend is almost zero.

If something happens to the operation, it is very likely they would have to borrow more to keep them a float because cutting dividend sends a very negative signal.

I think it is a waste of company resources. I think the post office, Computershare, and the financial institutions who handle all these transactions have more to gain than the common shareholders!

[percy]

Yes you are right.they hate paying out the cash when short and often have to borrow to pay divie.yes also saves them from cutting divie.
However with divie reinvestment you have the choice.cash or shares.EBO you have right to sell bonus shares back to the company.Still I prefer to keep them.

[macduffy]

Guys,

Companies who initiate dividend reinvestment are likely to be strained in their cash position. It is just a sugar-coated way of not cutting your dividend outright.

They pay you the dividend but take it back with this scheme called "dividend reinvestment". If you refer to the cash flow statement, cash flow after paying dividend is almost zero.

If something happens to the operation, it is very likely they would have to borrow more to keep them a float because cutting dividend sends a very negative signal.

I think it is a waste of company resources. I think the post office, Computershare, and the financial institutions who handle all these transactions have more to gain than the common shareholders!

Yes, it's sometimes a bit of a cautionary sign, especially with companies who resort to having their dividend reinvestment schemes underwritten, in effect paying out no cash but heavily diluting their equity.

But I'd be careful not to generalise too much on this. A stongly growing company will need to increase its equity base and dividend reinvestment can be a cost effective method for both shareholders and the company. EBO would probably be an example of this. Similarly, the big Aussie banks are continually expanding their balance sheets and need more capital. Entitlement issues and SPP's play a bigger part here of course but reinvestment of divs over the years has been a great way to grow wealth for investors in these companies.

So it's horses for courses IMO. One needs to consider each case on its merits and in the light of one's own circumstances and investment criteria.

[PhaedrusFollower]

Thank you all for your input on Dividend Reinvestment. I note Freightways have just stopped their plan. Are they too cash rich? :) Personally, I like getting dividend payments...only on a purely emotional view of money semi randomally popping up into my bank account. But from an investment point of view, and in the case of AIA, I think the reinvestment option looks good. I guess the real numbers are: If the purchase price at Dividend time is 2.5% or greater than the SP post dividend, plus say 1% brokerage, you win...although in my case, I only hold 10,000 AIA so the number of shares vs brokerage is disproportionate. I guess Telecom who pay 10% dividend annually, would be an example (with a dropping share price) of where you would take the cash. Interesting.

[peat]

Seems like it is not the overall impression that Auckland Airport is a horrible experience.

http://www.nzherald.co.nz/travel/news/article.cfm?c_id=7&objectid=10634068

Auckland International Airport Ltd has been voted ninth-best airport worldwide and the best airport in the Australia-Pacific region by travellers in the 2010 Skytrax World Airport awards...

The awards are based on a survey of airport customers that was carried out between July 2009 and March 2010.

[ratkin]

Good result it seems

Company had improved its level of
profitability and was increasing its interim dividend to 4 cents per share to
reflect the level of confidence the Board held that the strategy was
delivering a step-change in performance.

Charlies used the expression step change in their result yesterday , must be the new buzzword

[macduffy]

Did I miss it or did AIA not actually release an NPAT number in today's interim result?

There's reference to EBITDAFI being up 9.2% to $151m but I couldn't see an NPAT result.

EBITDAFI !!!!!!!!

[winner69]

Seems so ratkin .... just growing isn't good enough ... you need to make 'step change' in performance .... a 'step change' in market share .... and investing in markes where there is a 'step change' in demamd is a good strategy etc etc

Mean't to suggest you doing different things ... that will result in a 'step change'

Go to Google News -- over 300 items for recent 'step change' stuff in the world

Another phrase gaining prominence is 'hop,step and jump' when companies talk about new products and innovation ... 'hop' ones are just a little better than what they have now - step ones are better than that cause they are different in some way but the holy grail are 'jump' ones .... real innovation producing something that will change the market etc and kill the competitors .... and then those companies go on and set themselves targets like we mudt have 2 new 'jump' products every year ... and that 20% of our sa;es must come from 'jump' products developed in the last 3 years ...... else we won't get 'step change' growth

Get the picture .... isn't it all a load of old bollocks .... amazing how everybodies strategy is so similar eh ... not really differentiated are they ... but gives management the warm fuzzies ... and investors think they doing a good job

[winner69]

Did I miss it or did AIA not actually release an NPAT number in today's interim result?

There's reference to EBITDAFI being up 9.2% to $151m but I couldn't see an NPAT result.

EBITDAFI !!!!!!!!

Yep not in the news release although the full year is to be above $112m to $118m

Half Year was actually $65.5m (LY $54m)

[macduffy]

Yep not in the news release although the full year is to be above $112m to $118m

Half Year was actually $65.5m (LY $54m)

Thanks, winner.

Where do I find the Half year NPAT $65.5m ?

The news release doesn't include it and the links from the AIA website which purport to carry the full story don't work.

[CJ]

Charlies used the expression step change in their result yesterday , must be the new buzzwordAt least they didn't use 'pivot' which is being used a lot in the tech industry. "what we were doing was making no money so we have changed to something else" just doesn't really have the same ring as Pivot.

[macduffy]

There appears to be a complete lack of interest in AIA's result. "Underlying" profit up a solid 15%, a bit better than previous guidance and prospects of an even better year coming up. Taking revaluations into account for statutory profit reporting purposes shows a staggering 200%+ increase but of course that includes revaluations of properties and reverses the downward adjustment in the previous year.

Market seems unimpressed too - in marked contrast to the furore created a few years ago when it looked for a time that the company was to be sold to the Canadians!

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10746882

[percy]

Well I thought it was a good result.Pleased with it. Was surprised with the big increases in international travellers at both Cairns and Queenstown airports.

[Scotty020]

Totally agree, I thought this was a very good result, good outlook and was waiting for a jump in the share price.... still waiting

[Animeart]

Any chance of another takeover bit any time soon? Surely that would boost the price to over $3 easy.

[Jim]

This baby is going up and up up

[macduffy]

I'd agree with you there, belgy. One swallow - or in this case one week's passenger movements - do not a summer - or an investment case make. I'd join you in lightening off a few AIA but I still regard them as one of NZX's better companies and not sure I'd buy them back much cheaper. So I'll save the brokerage.

[percy]

I thought it was surprising that they bet world cup figures.Most impressed. One of the few companies on NZX with a deep moat.The large land bank guarantees future growth.Gateway to NZ.It is certainly in a very strong up trend,so I am happy to hold.

[ratkin]

Yep , they one of the safest long term bets , hence the high p/e. Future looks very bright , sooner or later there will be a rail link up which will help .
Its no wonder the canadians were so keen to pay well over 3.00 a few years back

[Animeart]

What I don't understand is how, despite record traffic, ASB's analyst actually down graded AIA's price from $2.15 to $2.00
The share sure fluctuates quite a bit in the past few weeks, from as low as $2.33 to a recent high of $2.59
Not sure if it's a good investment for potential takeover, as the bulk of the share is held by city councils and they might not be so keen on giving up their cash cow. The politicians certainly don't seem to know how to make their capitals work for them and expect dividend and rate increase to continue to cover their increasing spendings.

[percy]

What I don't understand is how, despite record traffic, ASB's analyst actually down graded AIA's price from $2.15 to $2.00
The share sure fluctuates quite a bit in the past few weeks, from as low as $2.33 to a recent high of $2.59
Not sure if it's a good investment for potential takeover, as the bulk of the share is held by city councils and they might not be so keen on giving up their cash cow. The politicians certainly don't seem to know how to make their capitals work for them and expect dividend and rate increase to continue to cover their increasing spendings.

On PE and yield ASB analyst probably right.Respected posters belgarion and Macduffy feel the share price is too high.
I have POT which is trading just over $10 and I think ASB analyst values it at $6 something.
The answer is in ratkin's post,which was the one before yours .ie post No.893.

[ratkin]

What I don't understand is how, despite record traffic, ASB's analyst actually down graded AIA's price from $2.15 to $2.00
The share sure fluctuates quite a bit in the past few weeks, from as low as $2.33 to a recent high of $2.59
Not sure if it's a good investment for potential takeover, as the bulk of the share is held by city councils and they might not be so keen on giving up their cash cow. The politicians certainly don't seem to know how to make their capitals work for them and expect dividend and rate increase to continue to cover their increasing spendings.

ASB valuations are from morning star , which really means Huntleys. They have shown in recent years to be totally unreliable , their valuations fairly meaningless. In addition i have a feeling their valuation of 2.00 is actually australian dollars , even though part way through the report it does say NZ dollars
Basically any share being hammered ends up with a buy rating , as they see it as cheap due to price changes , while any share that shoots up ends up being a hold or reduce. Im sure you can all see this isnt totally logical

[macduffy]

Quite so, ratkin.

A few years ago I had a short term Huntleys subscription - quite expensive - but didn't renew largely for the reason you mention. They appeared to work too closely to their valuations for stocks and would slap a Sell on quality companies far too soon for my liking. Equally, what turned out to be dogs, or at least non performers, became Buys on the way down, sometimes with disastrous results. No consideration given to basic Technical Analysis, as far as I could tell.

[ratkin]

Quite so, ratkin.

A few years ago I had a short term Huntleys subscription - quite expensive - but didn't renew largely for the reason you mention. They appeared to work too closely to their valuations for stocks and would slap a Sell on quality companies far too soon for my liking. Equally, what turned out to be dogs, or at least non performers, became Buys on the way down, sometimes with disastrous results. No consideration given to basic Technical Analysis, as far as I could tell.

Classic example was ABC learning , think they had a valuation of 8.00 on it as it plummeted all the way down to a dollar . the more it fell the more a screaming buy it looked according to huntlesys.
Then when a stock does this they quietly cease coverage of it and remove it from their portfoios , so it dosent show up as a negative. Probably not the only ones who do this , but they charge large subscription and can appear to know what they are talking about , in reality im not sure they do.

Anybody who uses ASB securities have these reports for free, but i wouldnt advice allowing their valuations sway your opinion of a stock , one way or the other

[ratkin]

one way to find out would be to take huntleys up on their free trial and see what valuation they have on aia



http://www.morningstar.com.au/

[macduffy]

Not a lot of interest in AIA these days but NPAT up 41% and dividend increased.

I hold.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10830452

:)

[winner69]

Not a lot of interest in AIA these days but NPAT up 41% and dividend increased.

I hold.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10830452

:)

This was one of stolwyks old favourites .....along with SKC he called them the twin sisters

He would have been pleased with how they have performed over the last few years ......he might have ramped the share price up a few cents more .....that was stolwyk for you .....bless his soul

[winner69]

Stolwyk still near the top of the ladder for the number of posts .....shows you how busy he was

[macduffy]

Still not much interest in AIA, despite SP at 12 month highs!

Makeover of the domestic terminal to start soon - not before time IMO!

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10863695

I hold.

[robbo24]

I've had these since the IPO - never seen a reason to offload them because they pay good dividends :)

Hoping that Hobbit-fever will raise passenger numbers a little!

[percy]

I've had these since the IPO - never seen a reason to offload them because they pay good dividends :)

Hoping that Hobbit-fever will raise passenger numbers a little!

I too am happy to hold.I noted when I was there last week that work had already started on drop off/pick up roadway.

[modandm]

Well done to all holders. A fantastic business, maybe even the best quality listed co in NZ. BUT - it is even more expensive than it has been in the past. I don't expect it to fall but there are better investments in the world.

I think SKC - which is like a sister (regulated monopoly) is a much better option. Better yield, and growth at a cheaper multiple.

With AIA all the near term pax growth is domestic and therefore lower margin for them, meanwhile capex plans continue to get deferred ad infinitum. How sustainable is the dividend? Will the regulator step in? Questions I would be asking myself.

[macduffy]

AIA hit a peak of around $3.50 in November 2007 as a result of the takeover bid from the Canada Pension Plan which offered $3.65, later increased to (from memory) $3.80.

That was then........

[modandm]

Well done to all holders. A fantastic business, maybe even the best quality listed co in NZ. BUT - it is even more expensive than it has been in the past. I don't expect it to fall but there are better investments in the world.

I think SKC - which is like a sister (regulated monopoly) is a much better option. Better yield, and growth at a cheaper multiple.

With AIA all the near term pax growth is domestic and therefore lower margin for them, meanwhile capex plans continue to get deferred ad infinitum. How sustainable is the dividend? Will the regulator step in? Questions I would be asking myself.

like i said: http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10864124

regulators will get you

[macduffy]

Reports out of Aussie that Morrison and Co Funds Management are offering a block of 100.5m AIA at $2.76.

Last sale today $2.94.

[Joshuatree]

Craigs have just rung me re this @ $2.75 for anyone int.

[minimoke]

Somone off shore is shopping at bargain prices. They just picked up 100,000,000 shares so that will deflate prices for a wee while.

[CJ]

Craigs have just rung me re this @ $2.75 for anyone int.Selling at less that the Super Fund sold at?

Whats everyone's veiw on the Super Fund selling down from ~8% to ~2%. Just cashing in on high price or view risk from Comcom following Wellington Airport outburst recently??

Where is the Superfund going to build a slushfund for MRP and other IPO's to come this year.


The New Zealand Superannuation Fund sold 7.6 percent of Auckland International Airport for a 6 percent discount, raising $276 million and benefiting from a share price near a five-year high.
The selldown was initiated by Morrison & Co Funds Management, which managed the investment for the fund. The sale was managed and underwritten by UBS New Zealand. The shares were sold overnight to institutions at $2.76 apiece, below yesterday's close of $2.94, which was the highest since November 2007.
"We are always looking to get the best return we can on our investment portfolio and to ensure we have the right mix of investments in our fund," general manager of investments Matt Whineray said in a statement.
"In conjunction with our investment manager Morrison & Co we have taken the opportunity presented by the current strong New Zealand share market and good demand for the shares to reduce our large overweight position in AIA," he said.
The transaction comes a week ahead of the airport company reporting its first-half results next week, which are expected to show a 3.1 percent increase in revenue to $222.5 million and reported profit before items up 4.2 percent to $73.7 million, according to Forsyth Barr analyst Andy Bowley.
The fund has some $3 billion of its holdings invested in New Zealand, including recent purchases of 35 percent of Datacom and an increase in its stake in Kaingaroa Forest.
Shares of Auckland Airport are rated a 'hold' based on the consensus of 10 analysts polled by Reuters, with a median price target of $2.81.
The fund retains a 2 percent holding of Auckland Airport, it said.

[Joshuatree]

Ended up @$2.76 from craigs. Got a few for Estate but didnt interest me.Forbarr double dipping.

[percy]

Ended up @$2.76 from craigs. Got a few for Estate but didnt interest me.Forbarr double dipping.

I was in Oamaru today,Craigs got the wife,who put her hand up @ $2.76.Pleased she did.

[CJ]

I was in Oamaru today,Craigs got the wife,who put her hand up @ $2.76.Pleased she did.Some people picked up on market for $2.765 so no big discount acheived. Whould ahve thought it would have closed a bit higher.

[percy]

Some people picked up on market for $2.765 so no big discount acheived. Whould ahve thought it would have closed a bit higher.

We find ourselves "well positioned" for the upturn.
STU was up and down like whore's draws,before it's upward trejactory,so maybe AIA will do the same. Whatever, I am pleased we added to our holding.

[CJ]

http://www.*************forum.com/viewtopic.php?f=3&t=1248&p=3332#p3332 Another fine result from a great company, I cannot get enoughGood result. Those that bought from the NZ Superfund sellout should be well rewarded.

[macduffy]

not to mention those that bought 4 years ago @ $1.51, just saying.

I share your enthusiasm for AIA, Drongo - I have them at an average cost of 45c.

However, there are a couple of caveats to that - the threat of regulated charges and the constant capital expenditure needed to keep the airport functional. The domestic terminal is becoming increasingly inadequate, as anyone would testify who has queued for baggage collection or toilets - and not necessarily at peak traffic times. I would expect relatively flat earnings for a period as these factors take effect.

[macduffy]

Dear lord macduffy, that's a long time to be holding for, and in the aerospace sector at that!

Goes back to the original float and takes account of later purchases and partial sales.

Oh, and there's a big difference between aerospace stocks and AIA - which is basically a property stock.

(Thanks for the honorific. I must have missed the announcement!)

;)

[robbo24]

AIA


11/04/2013 10:32


GENERAL





REL: 1032 HRS Auckland International Airport Limited





GENERAL: AIA: AIA Auckland Airport named best airport





Auckland Airport named best airport in Australia Pacific for 5th year in a


row





SKYTRAX World Airport Awards provide global recognition for Auckland Airport





- Best Airport in Australia Pacific for 5th year in a row


- Best Airport Staff Service for Australia Pacific for 2nd year running





- Second globally in Best Airport between 10 and 20 million passengers

[iced]

Back over $3

[ratkin]

First time since the canadian offer , got there in the end

[QOH]

What percentage of Queenstown airport does AIA own?
I was impressed with Queenstown airport...maybe it was the free wifi that did it for me.

[Jim]

What percentage of Queenstown airport does AIA own?
I was impressed with Queenstown airport...maybe it was the free wifi that did it for me.

25 % I think

[GTM 3442]

What percentage of Queenstown airport does AIA own?
I was impressed with Queenstown airport...maybe it was the free wifi that did it for me.

New Zealand airports don't have free wifi as a matter of course ? How twentieth-century ! ! !

[QOH]

New Zealand airports don't have free wifi as a matter of course ? How twentieth-century ! ! !
Wellington Airport doesn't have it unless it's got it very recently.
Brisbane didn't have it last time I was there either.

[peat]

New Zealand airports don't have free wifi as a matter of course ? How twentieth-century ! ! !

Personally I would say that actually caring about free Wi-Fi is quite '20th century'. :p

[CJ]

Personally I would say that actually caring about free Wi-Fi is quite '20th century'. :pagree:

Pre 2010- complaining about lack of wifi
Post 2010- complaining abound small 3/4G data caps

[CJ]

Good result today?

But more important, what was the 27m of shares that traded pre-open? Thats 20% of the company! [edit: opps decimal place incorrect - only 2% of shares]

[bohemian]

Christchurch does.

[macduffy]

Not a lot said about AIA on these threads at present but it's interesting to note that the SP is around 12 month highs. OK, so are a lot of other stocks...........

:cool:

[robbo24]

Not a lot said about AIA on these threads at present but it's interesting to note that the SP is around 12 month highs. OK, so are a lot of other stocks...........

:cool:

AIA isn't volatile enough to get a lot of discussion going on Sharetrader...

Let's face it, if it pays regular dividends and/or increases in capital value slowly it won't get discussion on here.

[percy]

Certainly ticking along nicely.
Just had a look at it's chart and it looks very strong.

[RTM]

AIA isn't volatile enough to get a lot of discussion going on Sharetrader...

Let's face it, if it pays regular dividends and/or increases in capital value slowly it won't get discussion on here.

So major share holder is Auckland city...right ?
Now....I wonder if these shares...and those of the port...are up for sale when they need to fund their infrastructure plans ?

[robbo24]

So major share holder is Auckland city...right ?
Now....I wonder if these shares...and those of the port...are up for sale when they need to fund their infrastructure plans ?

AIA has been a great investment for me since the AIA IPO years and years ago. Great dividends, no fuss, huge land holdings with appreciate along with the customer numbers and revenue.

If it was sufficiently discounted for current holders I would get on board...

[iceman]

Not a lot said about AIA on these threads at present but it's interesting to note that the SP is around 12 month highs. OK, so are a lot of other stocks...........

:cool:

Since you're bored with nothing to read on this thread, here are a few snippets I got from listening to Henry Van der Hayden, soon to be AIA Chairman, at a conference a couple of weeks ago. It is mostly related to AIA so hope people don't mind me posting it here. Its is in no particular order, just based on what I scribbled down listening to his address (the other half of it was about dairy and other trade with China):

# Today there are around 2B people belonging to the middle class that airlines and airports try to cater for as new customers
# In 2030, this is expected to rise to 4.9B people of which 65% will be in Asia
# China is currently the 2nd largest markets of travelers to NZ, growing at 30% p.a.
# Surprisingly, visitor numbers to NZ are static, with China/Asia growth only matching losses in visitors from USA and Europe
# Percentage of Chinese travelers that want to visit NZ is going down from where it was a few years ago, so work is needed on better marketing
# Each extra wide body plane that starts flying to NZ, brings around NZ$ 200 million economic benefit (I assume he was talking p.a.) on average
# AIA strategy is to coordinate with tourism industry and Air NZ to work together to increase visitor numbers
# AIA supports and pushes for further ease of travel arrangements (quick or no Visas) to make visiting NZ easier, especially for Asians
# AIA would love to see Auckland as a hub for travel between Asia and South America and is doing some feasibility studies of this if I understood correctly.

[macduffy]

Thanks for that, iceman. I remember reading some of those comments somewhere else recently so I guess Henry's address must have been reported. Actually, I wasn't bored so much as a bit surprised, given that the AIA SP was performing so well.

Like robbo, I've done very well out of AIA over the years so no complaints from me!

[Marilyn Munroe]

# AIA would love to see Auckland as a hub for travel between Asia and South America and is doing some feasibility studies of this if I understood correctly.

It won't be Cullen Airlines who provide this service, because this route is over water with no emergency divert airfields availiable the rulz sez that it con only be flown by four engined aicraft.

The only aircraft in Cullen Airlines fleet that can do this is the 747 which they are getting rid of.

Boop boop de do

Marilyn

[iceman]

It won't be Cullen Airlines who provide this service, because this route is over water with no emergency divert airfields availiable the rulz sez that it con only be flown by four engined aicraft.

The only aircraft in Cullen Airlines fleet that can do this is the 747 which they are getting rid of.

Boop boop de do

Marilyn

Last year I was involved in trying to fly Chinese staff from South America to China via NZ. The price of airfares with now only 1 airline flying between SA and NZ, as well as the very cumbersome transit visas for Chinese nationals in NZ, made it impossible. So we fly them via Europe. Using Auckland as a hub is a great idea and should be seriously looked into, but requires a lot of work I think.

[777]

It won't be Cullen Airlines who provide this service, because this route is over water with no emergency divert airfields availiable the rulz sez that it con only be flown by four engined aicraft.

The only aircraft in Cullen Airlines fleet that can do this is the 747 which they are getting rid of.

Boop boop de do

Marilyn

Not correct.EDTO ops are more complex than that. B773 can do it.

[Marilyn Munroe]

Not correct.EDTO ops are more complex than that. B773 can do it.

I assume the B773 route you tell of overflies airfields in the Polynesian Archipelago rather than the swing deep into the Southern Ocean used by current operators on Australasia South American routes?

Boop boop de do

Marilyn

[777]

I assume the B773 route you tell of overflies airfields in the Polynesian Archipelago rather than the swing deep into the Southern Ocean used by current operators on Australasia South American routes?

Boop boop de do

Marilyn

Doesn't have fly over them, just be within 4 hrs of suitable airport along the route used.

You also have to account for cargo hold fire suppression whether 2 or 4 engines.

[Balance]

https://www.nzx.com/companies/AIA/announcements/244405

$454m capital return or 34 cps (fully imputed).

Well done, AIA!

[percy]

https://www.nzx.com/companies/AIA/announcements/244405

$454m capital return or 34 cps (fully imputed).

Well done, AIA!

A very pleasant surprise.
Well done AIA.
Better owning an airport than an airline?!!!!!!!!!!!!!!!!!!! lol.

[robbo24]

A very pleasant surprise.

Woohoo - AIA has been my little gem since the IPO.

[G on]

This is a first for me to have return of capital. Paying me for 1 share out of 10 but the holding proportion stays the same has what impact on cps on future divs? An increase of div? Any clarity would be much appreciated

[macduffy]

Earnings per share will increase over what it would otherwise have been. Dividends per share should, theoretically, increase. Of course, we will all now have 10% less shares than before!

[Toasty]

Capital return sounds good but would it have better potentially for them to invest that money into additional services or products that would grow the value and revenue instead. It seems to me that they have just effectively forcibly removed 10% of everybody's holding.

[Balance]

Earnings per share will increase over what it would otherwise have been. Dividends per share should, theoretically, increase. Of course, we will all now have 10% less shares than before!

History of capital returns is that institutions usually use a proportion of the capital returned to buy back the cancelled shares on market.

So imagine 50% of the $454m returned being used to buy back shares on market - very favorable for the share price.

Also a good way to pay out imputation credits which investors can use to offset tax in some instances.

This is the second capital return by AIA - first one was in 2010 and it was 1 for 16 at $1.65.

Then, there was the 4 for 1 split in 2005 so anyone who bought the share at the IPO for $1.80 (?) is now looking at a $13.80 share price equivalent!

Well done, AIA!

[G on]

Is it because their is essentially no tax to pay on R.O.C that it appeals?
As Mac states, and that makes sense to me, there should be a theoretical increase of future dividend by 10% so the same income but the original dollar amount invested has reduced by 10%. Is there an advantage in buying more shares to retain the original percentage?
I understand (correctly?) that because the company equity reduces by the same amount that it should not have an impact on the share price. I would have expected the higher yield to have some affect on the share price tho!

[Harvey Specter]

A bit annoying as I have recently sold down about 20% as I was overwieight. If I had know, I would have held on.

Disc: a good sort of annoyed.

[modandm]

A very pleasant surprise.
Well done AIA.
Better owning an airport than an airline?!!!!!!!!!!!!!!!!!!! lol.

In the last 5 years - 28 Nov 2008 to 27 November 2013 total return:

AIA - 141.29%
AIR - 141.23%

Source: Bloomberg

2014 PE ratio:

AIA: 27x

AIR: 8x


You know my preference.

[percy]

In the last 5 years - 28 Nov 2008 to 27 November 2013 total return:

AIA - 141.29%
AIR - 141.23%

Source: Bloomberg

2014 PE ratio:

AIA: 27x

AIR: 8x


You know my preference.

From Yahoo charts.
January 2000 to November 2013. AIR -19.71% ........ AIA + 433.85%
Guess my preference?!!

[modandm]

From Yahoo charts.
January 2000 to November 2013. AIR -19.71% ........ AIA + 433.85%
Guess my preference?!!

Thanks percy. You keep holding AIA I keep holding AIR. Shall we have a bet on who does best over the next 5 years?

[percy]

Thanks percy. You keep holding AIA I keep holding AIR. Shall we have a bet on who does best over the next 5 years?

Think we should stick to the 10 year time frame.!!
My record of betting is very poor,so may limit my bet to $50.
Don't know how we will adjust for numerous AIA capital repayments, and frequent AIR capital raisings.!!!! lol.

[gv1]

When is the last date for being a shareholder for this capital return.

[Harvey Specter]

When is the last date for being a shareholder for this capital return.Its a long way off - next year sometime. Still needs to get IRD approval which will be interesting. They need to prove it is non in lieu of a dividend, even though they are paying it in lieu of the interim dividend - IRD may laugh at the application. Then it needs to get 75% shareholder approval. So the date is probably after that as well.

[Jay]

The blurb released said around early April, with payment early May - but as Harvey says lots to get thru first

[gv1]

Thanks buddies Harvey specter and Jay.

[macduffy]

Macquaries consider the proposed capital return to be "relatively value neutral".

http://www.macquarie.com.au/dafiles/Internet/mgl/au/apps/retail-newsletter/docs/2013-11/AIANZ281113e.pdf?cid=&spMailingID=7481254&spUserID=NzI1MDUzMzEwODkS1&spJobID=100872851&spReportId=MTAwODcyODUxS0

Interestingly, they reckon IRD approval is already held.

[Balance]

Macquaries consider the proposed capital return to be "relatively value neutral".

http://www.macquarie.com.au/dafiles/Internet/mgl/au/apps/retail-newsletter/docs/2013-11/AIANZ281113e.pdf?cid=&spMailingID=7481254&spUserID=NzI1MDUzMzEwODkS1&spJobID=100872851&spReportId=MTAwODcyODUxS0

Interestingly, they reckon IRD approval is already held.

Neutral recommendation when the sp is higher than their valuation?

Hardly shows courage of conviction of their research, does it?

[kyanar]

Proxy voting for the capital return is now available at the registry if you have an online account with Link.


Auckland Airport has today sent to shareholders the details of its Special Meeting to consider the proposal to return approximately $454 million of capital to shareholders, on a pro rata basis.
The meeting will be held at the Genesis Theatre, Vodafone Events Centre, 770 Great South Road, Manukau, Auckland on Wednesday, 12 February 2014. It will commence at 2pm.
Charles Spillane, Auckland Airport’s company secretary, says, “All shareholders on the register at 5pm on Tuesday, 21 January 2014 have today been sent the Notice of Special Meeting of Shareholders which includes an explanation of the capital return proposal, a letter from the chairman, Sir Henry van der Heyden, summarising some the proposal’s key aspects, an admission card / proxy voting form and a copy of Auckland Airport's application for final Court orders relating to the proposal.”

[tobo]

"you will receive $3.43 for each cancelled share"
Is the price locked in?

So people buying last week at $3.63 are effectively paying 2c more, ie. real cost is $3.65 (this being the difference, 20c, x 10% will be returned.)
Do I understand correctly?

[kyanar]

The price is locked in, yes. From the letter: "One in every ten of your shares will be cancelled and in return you will receive $3.43 for each cancelled share. The amount you will receive per share is approximately equal to the closing Auckland Airport share price on the NZX immediately prior to the announcement of the capital return on 28 November 2013"

Wonder if this will affect the share price once it sinks in?

[Deej5]

I can only assume that with 10% clawback there will be less shares available, therefore the value of the remaining 90% will rise in value. I'm a newbie to share trading so would be interested to hear from an experienced trader/investor.

[kyanar]

Could you in theory divert the capital return via the DRIP? Could be a way to claw back (a few less) shares at a potentially slight discount if it works.

[winner69]

Could you in theory divert the capital return via the DRIP? Could be a way to claw back (a few less) shares at a potentially slight discount if it works.

Don't think it works that way kaynar

Just take your cash and be happy - the market cap should remain the same so the shareprice for the remaining shares should adjust upwards.

If you reinvest the cash in AIA you will own a greater share ....good eh

[macduffy]

No comments on the AIA result? I thought it was pretty good but it seems it was in line with expectations.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11205678

[macduffy]

No comments on the AIA result? I thought it was pretty good but it seems it was in line with expectations.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11205678

Apologies for the clumsy duplication!

[benjitara]

I thought a very good result. A long term hold of this stock is really a no brainer. If they abide by regulatory conditions this would have to be one of the safest bets in the market. Macros all good over a long term hold (5 - 10 years+) very good.

[percy]

I thought a very good result. A long term hold of this stock is really a no brainer. If they abide by regulatory conditions this would have to be one of the safest bets in the market. Macros all good over a long term hold (5 - 10 years+) very good.

Have to agree with you and macduffy.

[robbo24]

Hmmmmmmm :)

http://www.3news.co.nz/Auckland-Airport-to-build-new-terminal/tabid/421/articleID/337881/Default.aspx

[ratkin]

Hmmmmmmm :)

http://www.3news.co.nz/Auckland-Airport-to-build-new-terminal/tabid/421/articleID/337881/Default.aspx

Sounds great , about time they sorted out decent transport links to the airport. The flight up from chch is quicker than the time it takes to get into central Auckland from the airport.
Very optimistic on the visitor number front. If they are right then there will be big benefits for the tourism/hotel sector as a whole

[ratkin]

I thought a very good result. A long term hold of this stock is really a no brainer. If they abide by regulatory conditions this would have to be one of the safest bets in the market. Macros all good over a long term hold (5 - 10 years+) very good.

We all complained when the canadin bid was knocked back , but with hindsight we have done much better from holding the stock, than the quick profit from selling out

[macduffy]

I don't think it was any surprise that AIA would continue to perform, moosie. One of the best on the NZX since listing!

[Marilyn Munroe]

Wandering off topic slightly.

The need to zig-zag around stands of duty free booze when going from the water bottle confiscation point to the departure lounge at Christchurch Airport annoys me.

Hopefully this does not occur at AIA and will not happen in the new terminal.

Boop boop de do
Marilyn

[percy]

Wandering off topic slightly.

The need to zig-zag around stands of duty free booze when going from the water bottle confiscation point to the departure lounge at Christchurch Airport annoys me.

Hopefully this does not occur at AIA and will not happen in the new terminal.

Boop boop de do
Marilyn

These guys are real pros and will charge you to dump your water bottle!!!!!!

[ratkin]

plans to use debt to fund $2.5 billion,
Thats a huge amount of debt

[Harvey Specter]

plans to use debt to fund $2.5 billion,
Thats a huge amount of debtBut as a regulated company, it also means its revenue will increase.

[kyanar]

I notice that they have announced a special dividend of 20.6cps (via NZX website) though I can't find an actual announcement for it, and thought the cancellation was in lieu of a dividend this year wasn't it? Is this just to offset taxes/lack of imputation credits/something else I don't quite understand?

[G on]

https://www.nzx.com/files/attachments/190662.pdf Check this out on nzx. It should clear things up.

[ari]

Can someone please clarify.....my AIA holding has today been adjusted due to capital reconstruction.....but I thought this was not till the 8/4 and then payout 12/4...have I missed something?

[macduffy]

Can someone please clarify.....my AIA holding has today been adjusted due to capital reconstruction.....but I thought this was not till the 8/4 and then payout 12/4...have I missed something?

It sounds like the "T+3" settlement procedure coming into play. Buyers today will settle on Tuesday 8 April but "record date" is Monday 7 April.

[Snow Leopard]

Can someone please clarify.....my AIA holding has today been adjusted due to capital reconstruction.....but I thought this was not till the 8/4 and then payout 12/4...have I missed something?

It is the T+3 thing for settlement as macduffy said.

They are from today, Thursday 3-Apr-2014, trading ex-caprec under the temporary code of AIAZ.
The record date is Monday 7-Apr-2014. So from 8-Apr-2014 they will be trading as AIA again.
You get paid Monday 14-Apr-2014.

Best Wishes
Paper Tiger

[ari]

Thanks guys

[robbo24]

Dear AIA,

Thank you for the large wad of cash that just appeared in my bank account.


Regards,

Robbo 24


Disc: Bought in IPO, still loving it.

[QOH]

Dear AIA,

Thank you for the large wad of cash that just appeared in my bank account.


Regards,

Robbo 24


Disc: Bought in IPO, still loving it.
I'd have preferred to have kept all my shares, sure I can buy them back but not at the price made me sell them for.

[Balance]

I'd have preferred to have kept all my shares, sure I can buy them back but not at the price made me sell them for.

Less shares so remaining shares worth more - that's how this works.

[Deej5]

Less shares so remaining shares worth more - that's how this works.

Remaining shares are worth more the the buy back anyway. Surely the present SP has to move 10% more to regain value? Or am I missing something?

[G on]

My understanding was that returning 10% of capital was going to be neutral to the share price. 10% less shares but also 10% less company. Happy with increase of SP but interested to see the impact on div. I would expect that if earnings are the same post capital return as pre then am I right in expecting there would be an increase in EPS?

[robbo24]

Less shares so remaining shares worth more - that's how this works.

Indeed. Need not discuss any further as the opportunity has passed.

[Jay]

Dumb question no. 453

I am trying to figure out what ratio I would enter into Metastock Downloader to take account of the consolidation/cancellation - 1 share for every 10 you had was cancelled
So is it 9:10 , 10:11 just can't think and work it out at present!

[Snow Leopard]

Dumb question no. 453

I am trying to figure out what ratio I would enter into Metastock Downloader to take account of the consolidation/cancellation - 1 share for every 10 you had was cancelled
So is it 9:10 , 10:11 just can't think and work it out at present!

Given that it was neither a split nor a consolidation I would suggest that you do not adjust anything.

Best Wishes
Paper Tiger

[ratkin]

The share cancellation seemed a waste of time to me . What was the point?

[robbo24]

The share cancellation seemed a waste of time to me . What was the point?

U get money.

[macduffy]

The share cancellation seemed a waste of time to me . What was the point?

The company has decided that it is "under-borrowed". That it is in shareholders' best interests for AIA to borrow more and for shareholders to have the cash for other purposes. Remaining shares should each be worth more than previously.

[Jay]

Hey PT, I did say it was a dumb question

Wasn't some shares cancelled? I was thinking if so, you would have to allow for it, less shares on issue therefore price jumps up to compensate, but then shareholders were given $$ instead so the status quo remains -
Hmm see what a good night sleep does - clears the thinking

Thanks again PT

[robbo24]

Hey PT, I did say it was a dumb question

Wasn't some shares cancelled? I was thinking if so, you would have to allow for it, less shares on issue therefore price jumps up to compensate, but then shareholders were given $$ instead so the status quo remains -
Hmm see what a good night sleep does - clears the thinking

Thanks again PT

The SP went up, seemingly in response to the news.

1 in 10 shares were cancelled.

[percy]

The past year has seen the share price go up 32.57% [ft] or 36.05% [yahoo].Not sure which is correct, more than happy with either.!!!!

[percy]

Makes one wonder why any would want to trade this stock.? Or it easier to trade one on a massive uptrend?
1 year SP growth 30.87% 2year 57.75% and 5 year 133.53%.
Boring is beautiful.!

[percy]

I wish I could offer a sensible valuation for AIA,and how long the up trend will last.I can't answer either question.
My overview is what made me buy AIA.Huge moat as it is the gateway to New Zealand.Huge land bank to be developed over the years,steady reliable cash flows.No competition.

[robbo24]

The most interesting chart you will see for awhile...

Those who say charts are a waste of time might want to say that to their broker/insto who has been playing AIA and creaming it for awhile now!

Ben Graham once said - "The more boring the stock, the better". Eat your heart out!

Moosie, please don't start "following" AIA... It's been a good, consistent investment for me since the IPO. We don't need your kind around here.

[winner69]

Moosie .....you calculated the gains made if bought and sold on those signals that you showed on your chart

Massive .....even more massive if profits were reinvested in the next trade as well ......and better than the 30% for a buy and hold

[winner69]

Yes, MASSIVE!

Robbo, if you're not careful I'll phone up your boss and tell him to promote you :D

12 months to end of April

Buy and hold duration gives 32% return

Trade moosies buy/sell signals with constant trade size gives 55% return (and only holding for about 1/2 the year)

Trade moosies buy/sell signals but increasing trade size each time from prior profits gives 70% return (again only in for 1/2year)

So $100k starting fund gives $32k return for holding or $55k / $70k doing it the moosie way ....plus what moosie would make on trading the other 1/2 year when cash not in AIA

No divies / cap returns in calculation but I reckon moosie would have been in to get these as well

MASSIVE ......go for it mate


Also ignored the second of two sell signals in a row ....heck you could have done shorting as well (not holding at that time) .....add another 10%to the above numbers

[percy]

12 months to end of April

Buy and hold duration gives 32% return

Trade moosies buy/sell signals with constant trade size gives 55% return (and only holding for about 1/2 the year)

Trade moosies buy/sell signals but increasing trade size each time from prior profits gives 70% return (again only in for 1/2year)

So $100k starting fund gives $32k return for holding or $55k / $70k doing it the moosie way ....plus what moosie would make on trading the other 1/2 year when cash not in AIA

No divies / cap returns in calculation but I reckon moosie would have been in to get these as well

MASSIVE ......go for it mate


Also ignored the second of two sell signals in a row ....heck you could have done shorting as well (not holding at that time) .....add another 10%to the above numbers

Looks as though this "old dog" is learning a good few new tricks.
May take time as I now have so many lines on the charts I am looking at, I am getting mixed up. lol.
Thank you.

[robbo24]

Yes, MASSIVE!

Robbo, if you're not careful I'll phone up your boss and tell him to promote you :D

I'll call your boss... Wait, nm.

[Xerof]

Unfortunately, I think all you've uncovered is an algo with big balls.

[Xerof]

Churning < 1% is easily able to run a price up and down. What proportion of the total never get traded? 80%?

Just a theory, but reckon it's happening all over the paddock these days.

Who? Anyone with control over large share parcels will be active. Familiar names usually high up on the registers would be my guess

[Xerof]

Moosie, your good mate couta has picked the same sort of activity on RYM, more so since entering those global indices, so it could also be as simple as 'risk on, risk off' activity, which is all we ever really see on Wall Street, day in, day out in trending markets

also, beware of your indicators showing clear turning points when you 'look back' to the past, as most of those indicators 're-paint' after the fact, as new trading data accumulates as time goes forward. It's not always as it seems, and presents a different picture when "live"

HTH

[percy]

Moosie, your good mate couta has picked the same sort of activity on RYM, more so since entering those global indices, so it could also be as simple as 'risk on, risk off' activity, which is all we ever really see on Wall Street, day in, day out in trending markets

also, beware of your indicators showing clear turning points when you 'look back' to the past, as most of those indicators 're-paint' after the fact, as new trading data accumulates as time goes forward. It's not always as it seems, and presents a different picture when "live"

HTH

To think I thought Moosie had give me the road map to fast vast profits!!! lol.

[robbo24]

Duly noted Captain. Caution shall be my watchword here!

Sorry to Robbo if my exposure of this leads to a tanking of the stock (yeah right...)

I'm not worried about tanking Moosie... I just get the sense that hourly PSAR update posts may get this nice, calm thread into a frenzy... And have a destabilizing effect on the stock.

[couta1]

LOL at getting negative reputation points for this thread. Some of you guys need to chill the **** out.
Looks like Holy ground over here and the faithful don't like you Newbies stuffing things up:scared: Disc-Dont hold so everyone is safe to buy

[percy]

Looking for a fall back to $3.90-3.95 level for a buy :)

I recently sold down a few AIA at $3.93.Reason being I expect lower earnings [ by approx. $4mil] with the duty free number of cigarettes reduced from 200 to 50.The PE at 26.97 is already very high, and the yield at 1.61 is rather low.Have had a great run with them.
I note the MACD confirms sp weakness.

[macduffy]

I recently sold down a few AIA at $3.93.Reason being I expect lower earnings [ by approx. $4mil] with the duty free number of cigarettes reduced from 200 to 50.The PE at 26.97 is already very high, and the yield at 1.61 is rather low.Have had a great run with them.
I note the MACD confirms sp weakness.

Certainly looking on the weak side from a TA point of view but I wonder how much effect the ciggy duty free bit will have on AIA? I assume that the duty free operator's rental is somehow linked to turnover but how much is that contributing to the airport's "retail" revenue?

Incidentally, that 1.61% yield is a net number - the gross yield including imputation credits is rather more respectable although still not in "income stock" territory.

Now, where does that leave moosie's "buy" level?

[macduffy]

Pretty much in the bin with the rest of the used up ciggies!

Fair enough. But keep half an eye on that bargain bin. Where there's muck there's brass!

;)

[Snow Leopard]

I concur percy, MACD, stochastic and RSI all looking sick with a break of key 90 day MA level on the cards. Algo may have given up based on P/E tracking too high.

So having punctured the 84 day EMA last Friday it has taken out the 85 to 91 day EMA range with today close.
More than 7% off recent [closing] highs we have not been in this bear territory since exactly one year ago.

It came back then, but can it do it again?
If only we knew now what we will know next month.

Best Wishes
Paper Tiger

[Harvey Specter]

I see Morningstar has put a sell label on it. Just to add to the positive indicator, I have also sold (did before I saw the updated Morningstar rating), so should be set to go back above $4 now.

[percy]

I see Morningstar has put a sell label on it. Just to add to the positive indicator, I have also sold (did before I saw the updated Morningstar rating), so should be set to go back above $4 now.

Guaranteed !!!!!! lol.

[arc]

Whats up with AIA, share price appears to be doing a base-jump.

[percy]

I recently sold down a few AIA at $3.93.Reason being I expect lower earnings [ by approx. $4mil] with the duty free number of cigarettes reduced from 200 to 50.The PE at 26.97 is already very high, and the yield at 1.61 is rather low.Have had a great run with them.
I note the MACD confirms sp weakness.

arc.
I posted the above post on 2nd of this month.
Maybe my reasons for selling down were correct????

[arc]

arc.
I posted the above post on 2nd of this month.
Maybe my reasons for selling down were correct????

... $3.93 must have been the ones i bought... ouch.. (laugh)

what do you think the medium term prognosis is...?

Just had a look at the 2 year chart, it did the same thing April-July last year. Heres hoping.

[percy]

... $3.93 must have been the ones i bought... ouch.. (laugh)

what do you think the medium term prognosis is...?

Just had a look at the 2 year chart, it did the same thing April-July last year. Heres hoping.

If you brought my shares rest easy,they were well looked after and in very condition.!!!!!
Medium to long term I think the prognosis for AIA is excellent.It is the gateway to NZ.
I did not sell out.I only sold down,or took a little "off the top."I added to our PGW and HNZ as the dividends are a lot higher the AIA's.
Depending on your objectives, I feel AIA is, or should be part of a long term portfolio.

[The BOWMAN]

If you brought my shares rest easy,they were well looked after and in very condition.!!!!!
Medium to long term I think the prognosis for AIA is excellent.It is the gateway to NZ.
I did not sell out.I only sold down,or took a little "off the top."I added to our PGW and HNZ as the dividends are a lot higher the AIA's.
Depending on your objectives, I feel AIA is, or should be part of a long term portfolio.

Interesting, I am selling down PGW with the intention to buy more AIA. Could have saved some brokers' fee. :-)

[percy]

Interesting, I am selling down PGW with the intention to buy more AIA. Could have saved some brokers' fee. :-)

Certainly could have.!!
Maybe we should start a "sharetrader direct" market where we can swap shares between ourselves?