Auckland International Airport Limited (AIA) Earnings Call Transcript & Summary

Good morning, everybody. Lovely to see some familiar faces back after a couple of years of struggling with Covid -- It really is good to be meeting in person for the first time since whenever it was the start of the pandemic and a very warm welcome to those of you who are listening online. Look, we'd love to be holding this at the airport, and we tried this year, and we're going to keep trying, but that's our goal, so we can all come out to the company and the assets you own and have the meeting where it should be. Now with us today are my fellow Directors of Auckland Airport. I can just but they end up or not the hit July hall, Liz Savage, Tania Simpson; Christine Spring; Mark Binns, Dean Hamilton and Mark Cairns, Mark as in Cairns, the confusing having to Lisan Christine is standing for election or reelection and will address the meeting a little later today. We'll also be hearing from Carrie Hurihanganui. I'll start calling a Carrie H., it's all a bit of a mouthful, Carrie who is attending her first Auckland Airport Annual Meeting today as our new Chief Executive; and Chief Executive Officer, Phil Neutze, here's someone. There is at the end of the table, other executives down the front here, and our auditors from Deloitte are also with us today. We have a quorum of shareholders, so I declare the meeting open. Now a small piece of housekeeping. The bathrooms are -- I think most of you have been here before, out the back. If we have an emergency and have to evacuate out the back, down the stairs and out to the car park and there'll be airport people helping you with that. Now a few rules for the day. Can I ask shareholders later when we have questions, to please give their name when speaking to the resolutions and to confirm you're either a shareholder or hold a proxy. As usual, during question time, roving microphones will be available to ensure that your comments or questions are conveyed not just to us, but online. So please wait for a microphone prior to asking your questions. Those of you participating online or have the ability or have had actually, and we'll have the ability to ask questions and vote through the virtual meeting platform. A member of our team will read those questions out at the appropriate time of the meeting. So everybody in the meeting can hear them. If you require any assistance with the virtual platform, just look at the guide, it's all there or there's a help line so call us. We may -- look, we may get online some questions but very similar in nature, and so we'll amalgamate them. But if anybody here or online feels their questions weren't answered, look, talk to our people after the meeting or give us a call, and Carrie's team will be very happy to answer questions. Now all of the resolutions put to shareholders today will be decided by way of a poll. And the polls will be administered by our share registry, and we'll announce the results of the polls via the stock exchanges later today. Now the meeting order the notice of meeting was sent to shareholders on the 23rd of September 2022, and the auditors of the company, and it was posted on our website. The financial statements for the year ending 30th of June 2022 and the audit report are included in the annual report, which is available online. And representatives of Deloitte are available here to answer any questions that might relate to audit matters. Now following my address, much more importantly, Carrie will address give you a review of the year and what's ahead of us. Then we'll consider the motions and receive any questions. We will have the 3 Directors standing for election, speak. One after another and will ask them question as a group after all 3 of them have spoken if there are any Now when we write you a couple of month months ago as part of the annual report, the recovery of air travel was just starting to ramp up. I'm pleased to say that since then, plans and travelers have continued to return in the place is starting to buzz again, how many of you have flown domestically or internationally this year? Great. I hope the experience -- it's not easy getting back going, and it's not always clean, but we're doing our best. There remains much hard work still to be done, but aviation is on the path to recovery now. And it is important at this time to acknowledge the outstanding efforts of our team and the wider aviation workforce representing the airlines and all the agencies especially those who worked through COVID, which was huge challenges to them for 2.5 years, and it has not been easy, but they've continued to turn up at work to serve customers, support airport partners and keep New Zealand safe and connected. And I know my fellow Directors join me in offering our say a thanks to those airport workers. Before I discuss financial results for 2022 and the outlook for the year ahead, just set the scene and remind us what we've been through. Today, we reflect on really an extraordinary 2022 financial year. Started with pretty severe lockdowns then after Christmas, the beginnings of revival with the gradual easing of border and travel restrictions. Despite the volatility and the uncertainty the team got on with the job of running New Zealand's easily the largest airport and gateway in supporting New Zealand's recovery. And during those 2.5 years, we've built roads, we've converted car parks, we've repaired runways, we've restarted construction on a new hotel and kicked off 2 major development projects. We created new aspirations to lead the transition to to net 0 for our own emissions. And we've worked really hard to continue to remind international airlines why New Zealand is a great place to fly to. Then at long last, we celebrated a lot inside travelers in the international arrivals area as the border reopened and people could reunite with family and friends. As I said, it's been an extraordinary year. As we look ahead, we must not forget that New Zealand is in a competition with other countries to attract back airlines and visitors to New Zealand. We are a long-haul destination. And while we have much to offer visitors, the reality is we have -- we're going to have to work hard to get their attention as they have many other attractive destinations to choose from. Now our results, as you will have seen probably this morning, we have updated our profit guidance for the market for underlying profit after tax for the 2023 financial year. and Carrie will go into more details on that. So that is good news. Now just running through the key performance numbers for the 2022 year, which really reflects a year of 2 halves. Now I'm not going to go through all the numbers because the prior year comparisons and everything, it's really -- you start comparing apples with oranges and even within the 6 months. But the important number probably is the underlying profit or in this case, the underlying loss, which was a loss of if someone will remind me, it was $11.6 million. And I mean that's not great news for shareholders, but it could have been a lot worse. If we can just scroll forward through the other numbers. Now Reflecting on these results in our agreements with our lenders, we will not consider a dividend until the end of this financial year, being well supported by our hugely supported by our lenders and everything. But our understanding is that we've got to be solid on the road to recovery. And look, things are looking good, but the earliest that dividend will be considered as the final dividend 2023 financial year. Now since early 2020, we've been guided by a 3-stage plan to charter course through the pandemic. And we call these respond, recover and accelerate. And we're now definitely into the recovery phase, increasingly apparent as our national carrier and global airlines start to rebuild their connections and schedules and as families and businesses separated by COVID are able to reconnect in person once again. Our border reopened in April 2022 to visitors from Australia followed by visitors from Visa waiver countries. So as a result, international passenger numbers, including transit increased to 1.3 million in the -- which is well up on the previous year. The total number of domestic passengers actually fell last year, but that was sort of because of the huge growth in the previous year. And right now, it's building and getting back to a very high capacity and actually straining the airlines very quickly. And domestic travel has really surged of late. The revival of passenger numbers is clearer every day. But look, the prolonged downturn had a heavy impact on our broader airport community. -- particularly on all the businesses and people reliant on visitors to the international terminal. And we all know that cascades right across New Zealand. In the 2022 financial year, we extended a further $178 million in rent relief to our retail and commercial tenants, and about $9 million to aeronautical rental and aircraft parking relief. This group, we probably had a right to. That was a voluntary thing we did, but it reflects our approach, our partnership-driven approach through the crisis. So over the past 2 years, the total rent relief to all those businesses in our buildings, et cetera, totaled $388 million because we really wanted them to be viable and with us as the rebuild started to occur. We also introduced a price freeze in our aeronautical charges during the 2023 financial year to support our airline partners. We're now starting to consult with airlines regarding price sending event for It starts from 2024 through to 2027. And we can finalize our capital plans as we get through that consultation. There has been a major bright spot through Covid, and that's our investment property business, which continued to perform very strongly through 2022, with the rent roll up 9% year-on-year to $127.5 million. Overall, our investment portfolio valuation was boosted by 10% and to $2.9 billion. Look, when you're out the airport and you get a chance to turn right into the landing, which Mark and his team have built, it is really worth going and looking at what you own out there. It is a stunning development, which people, the tenants really want to come and share. We continue to invest in this part of our business, and we announced Manawa Bay which is a premium fashion outlet center. And we're deep in negotiations with tenants, but the response has been extremely good. With the recovery now well underway, we are focused on the future.So the Board and Carrie and Carrie's team are working on a strategy refresh to ensure a strong and sustainable airport for the future. and we're looking forward to sharing that with you as we get through consultation on it, et cetera, in the new year. And sustainability is a key pillar in our fresh strategy. So we have set an ambitious target on our own emissions, Scope 1 and 2, and those we control to be net carbon 0 by 2030. And that's going to take some effort. I mean, the big one is heating in the terminals, transitioning from gas to a electric, won't be easy, but we can see our way through it, and we are committing to it. Our target excludes carbon emissions from aircraft flying to and from Auckland, which we do not control. But we will report those, and we do recognize we've got a key role in helping the airlines to adopt and implement new technologies as they become available. And as I've said, Carrie will outline in more detail. We are consulting with the airlines on the major lift and investment in our airport infrastructure to really transform the airport for the rest of the century and beyond. That domestic terminal is almost 60 years old. We've stretched and stretched it and the associated infrastructure around it. But it's -- really is ending -- nearing the end of its life as a jet terminal. And we would really like to be further advanced in its replacement, the jet facility, but COVID got on the way and it's cost us 3 years and perhaps a bit more. But we are continuing to progress that as our priority project and you're starting to see the cranes and everything around there. And that is a combined domestic and jet terminal, consistent with the master plan established for the airport almost a decade ago. Associated with this is new infrastructure for regional passengers, a new baggage system, a new transport hub, which you already see taking over the short-term international car park, apologies for that, but new taxiways and new terminal roading. Overall, the capital program we are consulting on would amount to the biggest infrastructure investment program in New Zealand's key airport gateway since it was opened 60 years ago. It's challenging. And as I said, COVID did not help. But we did manage to use that time at the time of COVID sort of quiet on the airport to do some major airside works, runway rehabilitation, which was scheduled major upgrade to our roading, but COVID hit us the latest and it only means we're going to have to rebuild our teams to tackle a very big build ahead. It's challenging and the construction environment is stretched. I mean, there's been huge cost escalation, but that's something we're just going to have to deal with, and I have huge confidence in our team to do it. Now last, getting to the end on leadership. In February of this year, we welcomed Carrie as our new Chief Executive. And Carrie's brought an outstanding level of energy and absolute passion to deliver a quality experience for our customers, and of course, was where she's come from a deep understanding of aviation and airlines. And look, this will serve the airport strongly as we reposition into the future. We also a few months ago, welcome Mark Cairn, former Chief Executive of the Port of Tauranga, who many of you will know to the Board. And Mark brings experience and expertise that will be invaluable in the next phase of the airport's life. And of course, as a new Board appointed director, he will stand for election today. The Board unanimously supports Mark's election. We also have Liz and Christine. In the other ways, standing for reelection this year as independent Directors in line with the NZX listing rules, the 3 years being up. Liz is standing for reelection. As I said, after 3 years, she's Chair of our Safety and Operational Committee and a member of the Aeronautical Pricing Committee and of people capability and EV Committee, and the Board unanimously support your reelection. Christine has actually been with the Board for 8 years now. She's a member of the Pricing Committee, the Infrastructure Development Committee and safety and operational risk committee and to very recently chaired that Board very well. And the Board unanimously supports her reelection. Looking ahead, we are working very hard through Scott and his team to attract international airlines to come back to walking. And we're having some success, but we've still got a long way to go basically, these big airlines, the international aviation industry is still building and there's a shortage of aluminum in the skies. The passenger demand is there. But we've got to have operating aircraft to fly them. New Zealand is attractive, but so are other countries, be it Australia, be in America and to rebuild the visitors market, which is so vital to this country, pre COVID. Our biggest earner and our biggest employer -- we do have to step up as a nation and encourage visitors to come back here. Currently, other nations like our friends across the Tasman are investing heavily in encouraging airlines and international routes to fly back to Australia. The airports putting money behind this, and I'm hopeful that our country on a wider plan will do more to rebuild visitation in our biggest industry in the months ahead. And the decisions we make now will have a major bearing on the speed of our country's recovery and the future shape of what is our biggest industry, the tourism industry. At the end of another challenging year, I'd like to thank you, our investors, for your continued support. And to you as customers and to our wider customers, we thank you for your patience and support as we've ramped up activities are pace alongside airlines and our aviation partners to reopen Auckland Airport. It's not easy out there, and we're going to slip up occasionally, but let's hope we only slip up once. And we do appreciate your patience. Carrie over to you.

Thank you, Patrick. It's lovely to be here in person from my first annual meeting with Auckland International Airport since joining the team in February this year. On a personal note, I would like to thank former Chief Executive, Adrian Littlewood, for his support during the handover and also the Board and wider team at Auckland Airport as well as our aviation partners for the warm welcome and support I've had since joining. Now in a moment, I will discuss the company's position. But first, it only feels right that I introduced myself to you a little bit since this is my first annual meeting. I actually arrived into New Zealand at Auckland Airport more than 30 years ago on a holiday. And Matt was fortunate to meet who is now my husband at the time and decided to stay here, study and eventually work my way through my degree by working as cabin crew for New Zealand. Now that was the start of my 23-plus year career in aviation and I have developed a great passion for the industry. Now over the years, I was able to work my way up through the business and in 2018, I was proud to become Air New Zealand's Chief Operating Officer. To now serve as Auckland's, Airport's Chief Executive is a great privilege. It's incredibly exciting and challenging time to join the organization, and I'm approaching the role with a great sense of purpose and determination to grow the potential of this business for the benefit of our customers, the community, the environment and ultimately, the long-term prosperity of the country. Now despite our full year passenger numbers being down 13% to $5.6 million, which Patrick talked to you about versus 2021, we are confident the numbers are heading in the right direction. By the end of October, we will have 22 airlines now operating to 38 destinations. Now that's well up from just 12 airlines and 21 destinations during the worst of the pandemic. This month, we are celebrating a return of 2 airline powerhouses, United Airlines and American Airlines, which will help to make Auckland the most connected Australasian city to North America. Now since joining Auckland Airport, I've taken a strong interest in our approach to sustainability and how we can further shift the dial that will be incredibly important for us. I've also been working with the team to understand the quality of that end-to-end experience that we are providing to our customers. Our aspirations are to deliver experiences that are easy seamless and into. I'm really excited about the restart of our infrastructure program as the platform for us for the future modern travel experience that we want to deliver. As Patrick has mentioned, we are currently underway with 2 major multiyear capital projects, and we're consulting with our major airline customers on the next stages for development of our combined international and domestic jet terminal. Now together, these projects will transform Auckland Airport to deliver the customer experience we collectively aspire to and will also assist us with our goals in sustainability. As we fold these strands of customer experience, sustainability and transformation into the strategy work underway with the Board, the overarching theme is about building the best possible future for our organization and the communities we serve. Now I would like to provide a little bit more detail on the capital projects for transformation that Patrick was referring to. During the 2022 financial year, we continued to focus on transport improvements, core infrastructure upgrades, and enabling works to support the future terminal and new property developments with over $250 million in capital expenditure. Now we invested $80 million in progressing the combined domestic and international jet terminal including design and enabling works for a new dedicated domestic jet peer, customer dwell and retail space and smarter baggage services. Now the exact timing of the combined jet terminal will be guided by the conclusion of airline consultation, but to give you a sense, it will be a 5-year build from the point of construction commencing. This will be a once-in-a-generation investment to create a terminal that appropriately represents its role as the gateway to New Zealand and is as seamless and efficient as the best airports in the world, often Changing comes to mind, right? That often is brought up as a great airport experience. We want fast, easy connections between international and domestic for our customers. Now while the build continues, we also are focused on working with our government partners to ensure continued growth in public transport options so that we can make it easy for travelers and workers to access the airport. In March 2022, we announced the development of Manawa Bay This is a $200 million plus 100 store premium outlet destination in the Northeastern edge of the airport precinct. Earthworks on the 150,000 square meter site are underway, and we are experiencing strong interest with leasing that's in progress and will be actually New Zealand's first ever premium purpose-built outlet center. In May this year, we outlined the start of another key project, a 300 million world-class transport hub. Now it is much more than a car park building. It incorporates 400 meters of public curbside pickup and drop off and 150 spaces for electric vehicles. Now what the team has targeted a U.S. accredited gold Park mark standard, what is that, in effect, that is a measure of facilities that use innovative and sustainable practices. The transport hub will be about putting the customer at the center of our thinking, and we'll be a great look forward to leak forward sorry, to smooth out the experience for travelers arriving for and returning from their flights. Just as importantly, we have a future-proof the design so that it paves the way for future mass rapid transit and deliver customers into the heart of the precinct. Now when we take these projects alongside the major upgrades we've already done on the 22 kilometers of local roading network, we are making significant progress on an airport that is fit for the future for travelers, visitors and employees in the airport community. Now I've emphasized the focus I want to put on customers and continuing the transformation of the airport and that customer journey. To help drive this Board, we announced 2 key leadership changes in the team in June this year. So Scott Tasker -- you can put your hand up there, Scott, at the front here. I was appointed to the role of General Manager, Customer and Aero Commercial. Now this expands on his existing role of aeronautical commercial and airline relationships, but it also means Scott is taking the lead on our strategy to deliver to our customers across the airport precinct, no pressure, Scott. I was also pleased to appoint Mary-Liz Tuck, down the end there, to the position of General Manager, Strategic infrastructure planning and transformation. I think it wants yield for the longest title within the company. In this role, Mary-Liz will coordinate our approach to sustainability, infrastructure and master planning and capital investment in aeronautical forecasting, really important as we lean into this infrastructure program we have over the next 5 years. In November, we're also looking forward to welcoming Melanie Dooney to the leadership team as General Manager of Corporate Services. Mel is joining us from her role as Chief People Officer at Te Whatu Ora, Auckland District, where she led her team through the challenges of the pandemic. The airport community was pulled in many directions over 2022 and some hard lockdowns that Patrick referred through to a series of border reopenings that scaled over time. And I really want to thank our 460 strong, capable and committed team for their dedication, not only to serve today's travelers but to lean in and contribute to the transformational projects we have on the go. Now amidst all the calls on people's attention over the past year, the team has remained focused on health, safety and well-being. Our priority was a great place for our people to work that makes not only a positive contribution to their well-being, but also where they can bring their whole selves to work. Our health and well-being focused extended to our wider community and it seems like a lifetime ago when we were in the vaccination drive. But our team volunteered 350 hours of their time after we provided the long-term parking facility of park and ride at no cost for use as Park and Vax. Dozens of our people worked alongside health workers to keep the site flowing and safely managed that saw 155,000 vaccinations delivered between September 2021 and January 2022. So that, along with the redeployment of our park and ride buses as mobile health clinics, we're incredibly proud of the efforts we contributed to make vaccines accessible for the community. I guess as we reflect on the community, it's also acknowledged that the location of Auckland Airport is of historical and cultural significance to [ moldy ]. In keeping with this, we've worked alongside local [ EVM ] and the design and delivery of the projects across the precinct. This includes the transport hub terminal development and Manawa Bay. Creating pathways into sustainable employment requires patience and understanding. And our partnership with the New Zealand youth mentoring network and Ara Education charitable trust provided an 8-week program for 16 mentor student payers and provide coaching and exposure to diverse work opportunities, and we were really pleased ahead overwhelmingly positive feedback. In a similar vein, we continued to support the Life Education Trust Counties Melco and the ASP PolyFest. Our Auckland's Airport Community Trust granted more than $368,000 to a range of community groups and a year 1 calls for health, well-being and social support were greater than ever. Now Patrick touched on sustainability. We are developing new aspirations for sustainability at Auckland Airport. This includes targeting a 90% reduction in Scope 1 and 2 emissions from that 2019 baseline to achieve a net 0 carbon emission by 2030. Now to be frank, we are currently sitting below our 2019 financial year baseline. However, the reality is this has more to do with disrupted operations than it does of substantive change at this time. Now we've signed up to the latest leader, climate leaders coalition statement of ambition, and we are conscious that we will not achieve these ambitious targets by continuing to do things the way that we've always done them. In line with this, our terminal air conditioning system is actually the largest in New Zealand. So tremendous opportunity, and we're phasing out the use of natural gas as a source of space and water heating and cooling, and it will see us have the first air source heat pump to replace our natural gas boilers, and this will be installed next year as a proof of concept towards our guest free future. Auckland Airport will also use electricity generated from a mix of on-site and off-site renewable energy sources. We're transitioning our transport fleet to electric vehicles or hybrids were feasible. But we do need to call out the likes of bio trucks, marine rescue vehicles and Hovercraft will remain diesel pure lack of alternatives currently available. However, we will still continue to monitor for opportunities in this space. Wherever possible, we're also striving to help our customers, airways and airlines to reduce their missions. These Scope 3 emissions are beyond our absolute control. However, we can and we will invest to support our stakeholders to reduce their emissions. We've also set specific targets to reduce waste to landfill and portable water use by 20%. So those are scope 3 emissions that we believe we can have a direct impact on. Now I'm conscious that some of the examples I provided are anecdotal. So for more detail, please do refer to our website for a full climate chain disclosure report. We prepared this in line with the recommendations of the task force on climate-related financial disclosures. Now as you may have seen in our market announcement this morning, Auckland Airport has revised our guidance and outlook. Guidance of underlying profit after tax of between $100 million and $130 million is now being provided for the 2023 financial year, an uplift on guidance comparatively to what we provided in August of between $50 million and $100 million. Now this is a result of Aviation's strong performance, both domestically and internationally. We've experienced stronger-than-expected rebound in the aviation market, particularly in the North and South American South Pacific and Tren Tasman markets. Looking ahead, there is more certainty on the performance of the market over the coming months with high aircraft load factors. Anyone that's phone may have experienced those high load factors. And we are seeing that the forward international seat capacity continues to be stronger than expected. Now overall, we're increasingly confident that aviation is returning to normal, and I will use inverted brackets on it because we are in a new normal. Now with the structure of the market becoming more balanced across both inbound and outbound as well as business family and friends and leisure traffic. And it's really important when you start to see that balance out again, that gives a real indication of the stability of the market in play. Now for the full 2023 financial year, we are now anticipating international passengers from numbers will be between 60% to 70% of pre-COVID levels and domestic passenger numbers being between 85 and 90 -- we have also adjusted our outlook, which is in line with the International Air Travel Association's view that the global industry will recover to pre-pandemic or 2019 levels by the end of the 2024 calendar year. Our capital expenditure guidance, however, for the 2023 financial year remains the same. We haven't changed that, and that sits at between $600 million and $700 million, reflecting a number of roading airfield investment property projects alongside with that combined domestic and international debt terminal that we've talked about before. The capital investment plan is considered within our consultation on aeronautical pricing under price setting event 4 and could change subject to the conclusion of consultation with airlines. But finally, I would like to thank all of our partners from government agencies to airlines service providers and infrastructure and construction partners for their support, communication and adaptability during a period of has been tremendous and rapid change. We certainly couldn't have done it without them. SO [Foreign Language]

Thank you, Carrie. Now to the resolutions. As I mentioned, Voting on all resolutions will be conducted by way of poll. You may ask questions on each matter being put to shareholders in person or through the virtual meeting website. If you are voting as a shareholder, proxy holder or as a corporate rep, please use the voting paper handed to you at registration this morning. Shareholders joining online will be able to cast their vote using the electronic voting card received when online registration is validated. To vote, you will need to click Get Voting Card within the online meeting platform. You'll be asked to enter your shareholder or proxy number to validate. Please then mark your voting card in the way you wish to vote by clicking for, against or abstain on the voting card. Then once you made your selection, you click submit vote on the bottom of the card to lodge your vote. Do you have any trouble just refer to the virtual meeting online portal guide or use the helpline 080-0200-220, if you require any assistance. Proxies, we've received proxies from about 943 shareholders representing just a little over 1 billion shares. Shareholders, the constitution allows for a maximum of 8 Directors. As I mentioned earlier, we have 3 Directors offering themselves for election or reelection. We're going to ask that to each address the meeting. And we'll take any questions from the floor or online for any of them after all 3 have spoken. We will then request shareholders to cast their votes for those resolutions. Ordinary Resolution 1 is the election of Mark Cairns. Mark was welcome to the Board on the first of June. The Board unanimously recommends that you vote in favor of Mark's reelection. And he is considered by the Board to be an independent nonexecutive director. Mark.

Thank you, Chair. [Foreign Language] Good morning, ladies and gentlemen and fellow shareholders. I was delighted to have the opportunity to join the Auckland Board back in April earlier this year. You have details on my background and qualifications in the notice of meeting. I'm a civil engineer by profession, and a fellow of the engineering in New Zealand. Last year, I retired as Chief Executive of NZX List port of Tauranga, New Zealand's largest and most successful port to pursue a full-time governance career. I'm also currently Chairman of Freightways Limited, a Director of Sanford Limited and Meridian Energy Limited. I retire from Meridian Energy next year after completing my 9-year term on that Board. From the Port of Tauranga and previous roles at , I bring extensive commercial experience from senior management roles and business operations at scale, including significant exposure to capital markets. 20 years ago, I was a member of the New Zealand Standards Committee, which developed NZS3910, New Zealand's most widely used general conditions of contract for building and several engineering contracts. This gives me a strong -- gives me strong insights into selecting the form of contract that is most appropriate for a particular project and then apportioning risk to whichever party is best able to manage and price this risk. Over my 40-year career, I have completed numerous large-scale engineering construction projects within time, cost and quality expectations, both as a contractor and more latterly as a principal or owner. These are highly relevant skills and experience to bring to our Board table and view of our multibillion-dollar capital development program over the coming years. I consider that Auckland Airport is an excellent company with a great future. we have enviable strategic landholdings and an outstanding management team. I seek your support to serve you as a director.

Thank you, ladies and gentlemen. Thanks, Mark. Let's move to Resolution 2, which is the reelection of Liz Savage. Liz was appointed as a director of the company at our 2019 Annual Meeting. The Board unanimously recommends that you vote in favor of Liz's reelection, and she is considered by the Board to be an independent non-Executive Director. Liz.

Thanks, Patrick. [Foreign Language] Good morning, everyone. I last addressed you at my initial election some 3 years ago, and I joined the Board just prior to the onset of a global pandemic. Great timing on my part, I think. And it's fair to say that the agenda through that time turned out to be somewhat different to that which was set out when I joined. There's been many challenges as you've heard today. But as I look ahead, there are tremendous opportunities for us too. The rebuild of travel and tourism is now well underway. And I'm bringing my career long expertise in the airline business and in tourism to help assist in that rebuild and to help the Board think through our opportunities ahead. And based in Australia, that's our biggest source market of international customers. I bring relevant perspectives to from our other Board roles, that's in airports, global travel operations, hospitality and workforce management. As you've heard, we've got significant infrastructure development ahead. The safety of work of our people and contractors on these programs is going to be a very big focus for the Board Safety and Operational Risk Committee, of which I'm now the Committee Chair. You've also heard from Carrie and an important priority ahead is around sustainability and climate adoption. I'm particularly passionate about how we accelerate our progress as an airport operator and also about how we create change through the aviation system overall. I enjoy my role very much, and it's such a pleasure to work with such a talented team of committed colleagues. Should you decide to reelect me today for a further time, it would be my absolute privilege to serve you, our shareholders. [Foreign Language] Thank you.

Thanks, Liz. Now to ordinary resolution 3, which is the reelection of Christine Spring. Christine was appointed as a Director of the company at 2014 Annual Meeting. And the Board unanimously recommends that shareholders vote in favor of Christine's reelection and she is considered by the Board to be an independent non-Executive Director. Christine.

[Foreign Language] Shareholders, Patrick, Board and Carrie, management, I'm honored and humbled to had the support of the Board and to present myself to shareholders for consideration for reelection. As Patrick just mentioned to you, I joined the Board in 2014 with a background that included 20 years in the strategic planning and development of aviation assets, as well as a focus on environmental management, aeronautical pricing, safety and operational risk management. My work included significant periods of executive level both actually at Auckland Airport and Melbourne airports as well as consulting for numerous New Zealand and global airports, including a 2-year stint at Abu Dhabi Airport. Since joining the Auckland Airport Board, I've contributed to the aeronautical pricing committee, the infrastructure development, audit and final risk committees. And as Patrick did mention, up just net 5 years as Chair of the Safety Operational Risk Committee, which has been a huge privilege and I'm looking forward to the possibility of working with Liz on that committee if we're both reelected. A chapter that will heavily influence and needing to be mindful of as we move forward as climate change impacts sustainability. We've heard Carrie talk about that today. But there's also the importance of cultural diversity, the principles of [indiscernible] as well as swiftly evolving technology developments that can enable significant operational efficiencies at our airport. From my role as the Director of Western Sydney Airport. And for those that don't know, it's the new second Sydney basin airport that's currently under construction. And as Chair of its design and construction Committee as well as being a member of its technology committee, I've spent the past 5 years focus on the understandings of principles of the latest terminal and technology development. I believe this knowledge and understanding would aid a future governance role for me with Auckland Airport. Over the past 8 years, I've diversified my governance work through roles with homes and 5 years with Unison Networks. I'm currently also chair of the Isthmus Group. For those of you who don't know, it's a landscaping and architectural planning practice, and I'm a Director of New Zealand wind farms. But in my heart, I am an engineer who cares passionately about creating businesses and community assets. that are sustainable and committed to aiding and caring for our land, our people, our economy and our future. I believe Auckland puts a superb company, it's got a diverse fan Board, CEO, employees and you committed shareholders that I believe together embody the [Foreign Language] of this extraordinary place of journey. For the -- to me, it's a place we can fly, we work, we rest, we can sleep, we can shop, we can relax, but it's a place that has become to me, it's a dream enabler, and I look forward to the opportunity as aeronautical activity collectivity reinvigorates and commercial property continues to grow, particularly with the evolution of Manawa Bay as you've heard about today, I'd be super proud to service -- continue serving as a director. And as I noted earlier, I want to be considered for reelection today.

thank you, Christine. I now move that Mark Cairns be elected as a Director of the company. I move that Liz Savage reelected as a Director of the company. and move that Christine Spring be reelected as a director of the company. Is there any -- are there any questions to the 3 Directors on the floor? Don't see any. And Louis any online?

There are no online questions.

Thank you. There are no further questions on that matter from shareholders. So now to Resolution 4. Deloitte is automatically reappointed this year as the auditor of the company under Section 207T of the Companies Act 1993. I move that Directors be authorized to fix the fees and expenses of the auditor. Are there any questions or online Louis? There are no online questions. Okay. We will now conduct the polls in respect of the motions put to the meeting. The poll will be administered by our share registry, as I said, Link Market Services, and they were also active scrutineers. Please complete the voting paper by ticking for, against or abstain Anyone who has any difficulty, just raise your hand and someone will come and help you. And Link Market Services will move through the room to click your voting papers. Those of you online and participating through the virtual meeting website should now submit your votes. The results from polls will be announced through the NZX and ASX and to the media later today. Now we get to the -- your part of the meeting. [Voting]

So I now invite shareholders to raise any questions or comments or discussion related to the presentations, the annual report, the financial statements or any other topics concerning the governance or management of the companies. [Operator Instructions] Please keep your questions short and clear. It's not really an opportunity for a long speech, please. And for those of you today who don't get a question addressed or don't get the opportunity. We've got the team here, Carrie and all her teams she introduced. We're very happy or the Board catch them over refreshments afterwards, and we're very happy to address them and have a chat to you. If you don't recognize the Board, I think they've all got tags on it actually says that my Speedster, but I think they're black, am I right? We have to get something wrong. Okay. [Operator Instructions] Just say who you're representing or as a shareholder before you speak. One microphone on its way.

Rachel, shareholder, and thank you all and team for that detailed presentation. I've got 2 questions. First of which is in regards to, I guess, interest rates, -- and with the increase in interest rates, what -- I guess, what effect does that have on projects and the future of the projects and the overall portfolio? And I'll ask the second one after

Look, yes, and interest rates are certainly headed north. That increases costs potentially increases charges, of course, because we get a return. But frankly, on our long-term infrastructure projects, it has very little. These are generational infrastructure projects and would rather not see inflation and construction inflation, but they need to be built. So we will build them nothing ever gets less expensive. And we do have the financial capacity, Phil, to do these projects. Your second one?

Yes. Second question is in regards to the profit after tax. So it looks like there's quite a large decrease in about almost 60% in the profit after tax. And I guess what was the, I guess, main attribution to that decrease?

Yes. And are you talking underlying profits after tax.

Yes, profit after tax.

Yes, because an underlying, we take out Phil, do you want to -- I don't know if your microphone is on.

Can you hear me?

Yes. I'll let you [indiscernible] take that

Yes. So I think the question relates to reported profit after tax, and we included in that evaluation. So the FY '21 year had something like a $500 million uplift in our investment property portfolio valuation as well as property, plant and equipment. We had less of that in the last 12 months. And in fact, once you adjust that out, our underlying profit or loss for the year was an improvement on the previous year.

Thank you for 2 excellent questions. Any other hands here

Yes, sir. Just the microphone is about Four seconds away Yes. Good afternoon, John Hunt, shareholder. I wanted to know how the planning for the railway station is proceeding in view of the difficulties of getting to the airport.

Yes. There's actually 2 things. First of all, it's a heavy rail link to which goes to Puhinui, if you know that station. Have you been to Puhinui in the last year? And actually an excellent facility builds. Yes. That's obviously outside our [ balliwick ] but I'll do make a personal comment that we think that is a very vital transit link to the airport. The road has been upgraded, Puhinui. We've got the transport from the station. There is some investment, I think, required by Kiwi Rail and like a third track to really make that hump. And we would certainly be a backer of that to the government and to the new me. We do see that as a pretty key link. Longer term, obviously, there's talk of the prospect of light rail to the airport. All we can say on that is all our plans and everything. We have a facility to bring a light rail should it come right to the terminals. We're with that space and plan for it. Whether it will -- when it will happen, whether it will happen, will we as people then I can opine on that. But an excellent question. And we do know that travel to the airport, it's not always easy. The new George bulk drive investment, if you have to drive and more people are driving at the moment because of COVID has certainly lifted things once you get on to George Bolt, I think you'll all see that. And it was a big investment that Andre and his team put in, but it is certainly streaming traffic around the our environment is better, but there's still challenges and particularly as you construction and car parks have to be moved. We're doing our best. We know it's not always perfect. But I think once we complete the cycle of investment, you'll be pretty pleased. And yes, rail, I think, is a key link.

Last time we went to the airport, we finished taking outside the OL build.

Yes. Look, and we had -- we had a little bit of lumpy times. I think it's fair to say to carry because we had to take a whole lot of parking out in order to build things. When did you last go out there?

That was about a month ago.

Yes. I do pack there to sometimes. It is -- the way finding and the parking has improved a lot, but it's still pretty crowded, I got to say, and we had committed Mark to meeting it. And aviation has come back a bit quicker than many people expected, and more people are driving their cars to the airport, which is a COVID impact. Look, talk to Mark on the end there about what we're doing and very happy to tell you what we're doing.

And can I add to that.

Yes, absolutely.

So if I could just add to that. Can you hear me okay? Patrick is absolutely right. And one of the things that we are working through is that infrastructure program that we're talking to about is kind of the next 5 years plus, and we're acutely aware of ensuring that we're providing good options for our customers whilst in construction, that's not an excuse for us not to provide a seamless experience, but there are things like you're currently experiencing that the parking is further away than it was because of that parking A, the short-term parking. The transport hub pickup and drop-off will open this -- around this time next year. And then the full facility with all the parking will open in 2024. So we are in the cycle, but that long-term outcome that Patrick referred to is absolutely high on the agenda.

Any more questions from the floor here? One here, microphones is on its way.

Richard Myers, a shareholder. Earlier in the meeting, a mention was made of a dividend. I'd like a reply how that would be considered by the Board and yes, bearing in mind with what's going on in the company and also bearing in mind the capital raise that the company had. And I think from my point of view as a shareholder, that was a golden opportunity to purchase further shares in the company.