Q’town airport offers promise of growth freeze and no share sale [Crux, 23/10/20]
The latest draft Queenstown Airport Corporation (QAC) Statement of Intent has been published by QLDC in advance of a vote next week by elected councillors and it offers major concessions that, without Covid19, might be seen as a victory for anti-expansion lobby groups.
On the other hand, the QAC proposes increasing its debt levels to $87 million by 2023 compared to a current $69 million.
The major points are:
- No ZQN noise boundary expansion during the term of the SOI
- More recognition of climate change
- The purchase of Lot 6 has been provisionally agreed with Alastair Porter for $18.34 million – much less than Mr Porter wanted.
- More community consultation in the future
- Wanaka airport spend will only be to maintain what is there already.
- No new QAC shares will be issued. QAC says it can fund itself from debt and existing cash flow – however, to be reviewed annually.
The QAC passenger forecast show the severity of the passenger traffic collapse post Covid – but does foresee an improvement over the next three years.
Source: Queenstown Airport Corporation – SOI, October 2020
The decline in air traffic is matched by an increase in proposed debt. A dividend to QLDC as a major shareholder is not forecast until 2023 – and even then at the low level of around $2 million.