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Wellington Airport strengthens balance sheet, plans for 85% recovery by 2022

3 Jun 2020  By Staff Reporter | news@tourismticker.com | @tourismticker

Wellington Airport has downsized its operations in response to Covid-19 but hopes to regain 85% of its business by 2022.

The airport was less exposed to the international tourism market, partly due to its short runway and different customer profile, the company said in its annual report released last week.

“Passenger numbers plummeted in March, down -40%, and then all the way to -99% in April,” Wellington Airport said.

Steve Sanderson

“The recent move to level 2 has, however, been a positive start for the aviation sector with an increase in scheduled domestic flights within New Zealand.”

The company had announced a financial support package, cut costs by 26%, including making 30% of airport staff redundant, some moving to part-time work, and others taking pay cuts.

Chief executive Steve Sanderson said Covid-19 continued to have an unprecedented impact on the aviation and tourism industry and on Wellington Airport.

WellingtonNZ’s domestic marketing campaigns would not be enough to sustain the many inbound tourism operators around the country and the biggest hope lay in a trans-Tasman bubble, he said.

“Australia used to account for 40% of New Zealand’s international visitors and that also equated to 13% of all outbound Australian travellers,” the company said.

“With a lack of other options for Australians, especially during the ski season, and a lot of available capacity in New Zealand we could expect that number to rise significantly.

“It is vital for the survival of our tourism industry and our economy that a trans-Tasman bubble is enabled as soon as possible. We are working closely New Zealand and Australian aviation groups and our respective Governments to develop solutions to ensure safe travel options and safely re-open our borders to our neighbours.”

Passenger numbers plummeted 40% in March, and then 99% in April. During 2019 there were 5.2 million domestic passengers, and 920,000 international passengers.

Wellington Airport had obtained agreement with its banks to increase facilities from $100m to $170m, and obtained a temporary waiver of bank covenants through to 2021.

In addition, its shareholders Infratil and Wellington City Council had agreed to inject $75m by way of a preference share issue.

Total operating revenue for the year ended March 2020 was $146m compared with $137m in 2019, with the profit after tax $28m compared with $23m previously.

 


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