Waikato Regional Airport Ltd (WRAL) says the challenging travel and tourism environment over the past 12 months is reflected in its annual financial results.
WRAL has reported a pre-tax profit of $3.6 million, down from $18.6m in 2023.
Land sales returned a gross margin of $2.8 million to the Group, significantly down from the $10.1 million in land profits the previous year. The drop was no surprise and had been forecast, said WRAL chief executive Mark Morgan.
“In 2022-23 we saw record sales for Titanium Park with the successful completion of the fifth stage of the central precinct. We anticipated we would not get the same return from land sales this year and expect that to continue in the near future given the staged nature of our property development activities.”
Non-cash valuation adjustments contributed net $1.4 million to the Group. But a slow tourism market saw Hamilton Airport and the WRAL-owned Jet Park Hamilton Airport Hotel incur a combined $0.5 million deficit. While aeronautical income was up, there was a drop in airline passenger numbers and hotel occupancy.
“Those trading businesses have definitely been impacted by some belt-tightening from domestic travellers and some very challenging economic conditions,” Morgan said.
“Once again, this shows the value of our diversification strategy including our long-term investment in land holdings. It means WRAL is simply not as exposed to the vagaries of the travel market as it might otherwise have been.”
The 2024 final net result also included a one-off $6.5 million non-cash tax expense following a change in income tax legislation impacting buildings during the 2023-24 financial year.
During the year, WRAL invested more than $7.3 million in long-term assets and property development, growing the value of its assets to $274 million. That investment was made with only a $2.7 million net increase in debt. Total Group debt now sits at $22.8 million.
Of the $7.3 million invested, $3.2 million was directed into core aeronautical business. Major investments included completion of an on-site solar farm and terminal seismic strengthening plus the acquisition of additional aeronautical properties.
In WRAL’s 2023-24 Annual Report, chair Barry Harris noted the Jet Park Hamilton Hotel had achieved Qualmark 4 Star Plus accreditation during the year.
“This positions the hotel as only the second hotel property with this level of accreditation in the greater Hamilton catchment market. It is a credit to our hotel operator Jet Park, as is the high guest ratings and reviews consistently positioning the hotel as the highest rated property in the market.”
WRAL is a council-controlled organisation owned by Hamilton City, Otorohanga, Waipā, Waikato and Matamata-Piako District Councils and is the umbrella for subsidiaries Hamilton Airport, Hamilton Airport Hotel Limited, Hamilton & Waikato Tourism (HWT) and Titanium Park Limited.
For more information call Mark Morgan, 027 562 3351
