Auckland International Airport Limited (AIA)

[Sideshow Bob]

I was surprised to learn of Christchurch Airports proposal to build an international airport at Tarras adjacent to existing Wanaka and AIA part owned Queenstown Airport.

Will Central Otago end up like South East Queensland with too many airports?

Boop boop de do
Marilyn

There is a movement to take the airport completely out of Queenstown - for alternate land use and land value.

Worth noting Tarras is under Central Otago District Council, Wanaka is under QLDC who own 75% of Qtown airport. $45m is a decent amount of wedge for Chch airport to spend to have a crack......

[Zaphod]

It could be a long hard fight to gain approval under the RMA, assuming it's still around by the time they kick off the approval process.

[Bjauck]

Profit down 63%.
https://www.stuff.co.nz/business/122...wn-63-per-cent

Will recovery take longer than previously expected?

[value_investor]

I don't see the company being out of the woods anytime soon here. All of the metrics will continue at this level for the foreseeable future and their CEO has already said he expects this to go on longer than the 3 years predicted by the Air Travel Association. The operating section of the cashflow is down 53% to $175m and they are predicting CAPEX of $250-300m in FY21. From that, they'll be burning cash definitely this FY.

Luckily they raised capital very early to have a $700m buffer. However, buying when the shares are so diluted doesn't appeal. I wish there was some value here but that's not there unless you go down into the low 4s for me.

This is so far away from being a fair valuation still. At $6.45, the PE is about 50. If it returns to its regular pre covid underlying earnings then it is valued at about a PE of 36. Add in the uncertainty, and I don't think I'd be able to sleep well on this.

[Brain]

I don't see the company being out of the woods anytime soon here. All of the metrics will continue at this level for the foreseeable future and their CEO has already said he expects this to go on longer than the 3 years predicted by the Air Travel Association. The operating section of the cashflow is down 53% to $175m and they are predicting CAPEX of $250-300m in FY21. From that, they'll be burning cash definitely this FY.

Luckily they raised capital very early to have a $700m buffer. However, buying when the shares are so diluted doesn't appeal. I wish there was some value here but that's not there unless you go down into the low 4s for me.

This is so far away from being a fair valuation still. At $6.45, the PE is about 50. If it returns to its regular pre covid underlying earnings then it is valued at about a PE of 36. Add in the uncertainty, and I don't think I'd be able to sleep well on this.

I am not a shareholder and would not be tempted to buy even in the low 2s. Far too many unknowns and it is very hard to be positive about international travel to and from NZ. Maybe in 2 years time there may be a clearer picture. Until then there are better opportunities which include having cash in the bank. Institutions have no choice but to support these shares but small shareholders have better options.

[horus1]

sold out completely today. This with FBU, show ineptitude by the directors who should have acted sooner to reduce costs . How you can justify the price with no divs for years is beyond me.

[bottomfeeder]

Sadly, companies paying dividends at the moment are the exception rather than the rule. However profits are more important. Cant see Auckland Airport making profits for some time to come. But FBU is another matter. The chances of increased SP of FBU is better than bank interest rates, imho.

[macduffy]

This with FBU, show ineptitude by the directors who should have acted sooner to reduce costs .

Are you sure this isn't a "with benefit of hindsight" comment, horus? After all, the implications of the virus took some time to develop and become "obvious". Even now, it would take a wild guess to predict the future course and outcome.

[wilco]

sold out completely today. This with FBU, show ineptitude by the directors who should have acted sooner to reduce costs . How you can justify the price with no divs for years is beyond me.

Ditto here horus - have held since float.

[tango]

Are you sure this isn't a "with benefit of hindsight" comment, horus? After all, the implications of the virus took some time to develop and become "obvious". Even now, it would take a wild guess to predict the future course and outcome.

Playing devil’s advocate here… Air New Zealand were very fast to downsize and cut flights and staff. They saw the writing on the wall long before anyone else. Qantas was still expecting life to go on like normal. Air New Zealand slashed their operations immediately.

AIA did a let’s cut some capex and costs, raise some funds and cross our fingers this is over quick. I wouldn’t say the management is inept but I don’t think they handled the crisis as well as they could have. There are lots of variables but you have to contingency plan for the worst case scenario and I don’t think they did. Air New Zealand did plan for the worse case knowing they could ramp up again fast if necessary

AIA are doing some good forward planning for when the borders reopen but I think they are being wildly optimistic with their forecast dates and ramp up time for recovery of domestic and international flights.