AIAL Annual Report 2001

http://www.auckland-airport.co.nz/Annual2001/Welcome.html [3/13/2002 10:45:55 AM] AIAL Annual Report 2001

Record surplus after tax of $59.110 million - an increase of 15.8 per cent over the previous year. Dividend distribution of $47.3 million - representing 80 per cent of the surplus after tax or 11.25 cents per share. Total passenger movements 8,424,164 - up 5.2 per cent International passenger movements totalled 5,040,922 - up 5.0 per cent. Domestic passenger movements 3,383,242 - up 5.5 per cent. Commencement of expansion of the first floor departure level of the international terminal building to meet increased passenger demand - due for completion in November 2001. Revenue increased 11.4 per cent to a record $189.363 million. Significant increase in retail revenue - up 11.8 per cent to $56.616 million, representing 30 per cent of all revenue. Further improvement in operating (EBITDA) margin to 73.5 per cent. Significant input over the year, and costs of approximately $1.6 million, in respect of the price consultation process and the Commerce Commission Inquiry into Airfield Pricing. Capital expenditure during the period totalling $69.449 million, including $25.1 million on the runway rehabilitation project and $17.1 million on investment properties. Success of the new Retail Shopping Centre, with further additions underway at year-end. Return on average shareholders' funds of 11.4 per cent (10.1 per cent last year). Shareholders' funds/total asset ratio of 61.1 per cent.

Airport Web Site Home Page

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Aviation Developments Since the preparation of this report, there have been significant developments in both the international and local aviation markets. The horrendous acts of terrorism in the United States and any consequential escalation of events will inevitably have negative impacts on international air travel. These acts have forever changed the face of international aviation. Also the recent demise of Ansett Australia and the associated impact on our major customer, Air New Zealand, has been a further complicating factor within our local market place. As with any other company involved with the aviation and international travel markets, we cannot as yet fully determine the likely effects of these developments on our company. Despite the fact that the company has no direct exposure to Ansett Australia, and given international uncertainty, it would not be unrealistic to expect some, albeit possibly short-term, instability. Shareholders can be assured that your Board and management are dedicated to both protecting and enhancing shareholder value, and to that end the senior management team has contingency plans to deal with the range of possible eventualities. The Board will further update shareholders at the Annual Meeting to be held on 21 November 2001 when actual developments may have become clearer.

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2001 2000Movement $000s $000s %

Financial Performance Operating Revenue 189,363 169,990 +11.4% Surplus before Interest, Taxation & 139,107 123,749 +12.4% Depreciation Net Interest 19,792 18,522 +6.9% Surplus before Taxation 88,585 75,739 +17.0% Taxation 29,332 25,005 +17.3% Surplus after Taxation 59,110 51,053 +15.8% Dividends : ● Ordinary - cents per share 11.25c 9.70c +16.0% - amount 47,300 40,740 +16.1% ● Special - cents per share - 5.50c - - amount - 23,100 -

Financial Position Issued Capital 212,000 210,000 +1.0% Equity 540,168 499,946 +8.0% Total Assets 884,288 841,323 +5.1% Equity Ratio 61.1% 59.4% +2.9% Earnings per Share 14.05c 12.16c +15.5% Return on Average Equity 11.4% 10.1% +12.9%

Operational Performance Passenger Movements 8,424,1648,006,042 +5.2% Aircraft Movements 147,868 147,769 +0.1% Cargo Tonnage 186,954 191,679 -2.5%

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We embrace our Vision and commit to meeting the expectation of excellence

OUR VALUES: We strive to achieve our Vision by focusing on:

People: consistently delivering outstanding customer service, fostering co-operation with all stakeholders and encouraging staff to achieve their full potential

Safety: facilitating the safe and secure movement of all people, vehicles, aircraft and cargo on airport effectively and efficiently

Environment: operating in a manner that minimises impact on our local community and physical environs

Returns: working continually to achieve appropriate improvements in shareholder value

OUR COMMITMENT: In support of our Vision we will be:

Proactive: responding positively to challenge, being innovative and communicating effectively

Responsible: ensuring our actions and initiatives raise standards and improve performances through both individual and team efforts

Ethical: engaging in sound practices, respecting others and accepting responsibility for our behaviour

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Airport Web Site Home Page

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The Board of Directors is pleased to announce another excellent year for the company. Revenue increased 11.4 per cent to a record $189.363 million, while the surplus after tax improved 15.8 per cent to $59.110 million. Total dividends will amount to $47.3 million, representing a distribution of 80 per cent of the surplus after tax. The record financial performance was driven by positive increases in the company's key activity levels throughout the full 12-month period. Significantly: International passenger movements increased 5.0 per cent. Domestic passenger movements increased 5.5 per cent. Aircraft take-off weights were up 3.4 per cent. Retail revenue increased 11.8 per cent to $56.616 million, representing 30 per cent of the company's total revenue. The value of the company's investment property portfolio increased to $81.192 million.

Financial Results Revenue totalled $189.363 million, an increase of 11.4 per cent, or $19.373 million, over the $169.990 million recorded in the previous financial year. Operating costs increased 8.7 per cent, or $4.015 million, to $50.256 million for the year with a significant amount, some $1.620 million, attributed to costs associated with the extended pricing consultation process and the yet-to-be-completed Commerce http://www.auckland-airport.co.nz/Annual2001/directors_report.html (1 of 8) [3/13/2002 10:46:39 AM] AIAL Annual Report 2001 Commission Inquiry into Airfield Pricing. Earnings before interest, tax and depreciation (EBITDA) increased 12.4 per cent to $139.107 million, compared with $123.749 million last year. Importantly the EBITDA margin showed further improvement to 73.5 per cent (72.8 per cent). Depreciation amounted to $30.730 million ($29.488 million) with the increase mainly reflecting the capital expenditure on the runway rehabilitation and the terminal additions. Interest costs increased to $19.792 million ($18.522 million) with the higher amount reflecting the increased level of term borrowings throughout the period which at year-end amounted to $320 million ($290 million). The weighted average cost of borrowings for the year was 7.27 per cent (6.97 per cent). The surplus before tax increased 17.0 per cent to $88.585 million ($75.739 million), while taxation at the rate of 33.0 per cent amounted to $29.332 million ($25.005 million). The record surplus after tax of $59.110 million represents an earnings-per-share of 14.1 cents (12.2 cents) and a return on average shareholders' funds of 11.4 per cent (10.1 per cent). During the year the company received dividends totalling $0.55 million from the associate company, HMSC-AIAL Limited. The company's 50 per cent share of the joint venture profit amounted to $0.407 million ($0.319 million), which meant that for the year the net equity position reduced by $0.143 million.

Dividends For the half-year ended 31 December 2000, the company paid a fully imputed interim dividend of 5.0 cents per share (4.5 cents per share) which amounted to $21.0 million. The directors have declared a fully imputed final dividend of 6.25 cents per share (5.2 cents per share), amounting to $26.3 million. Total dividends for the year amounted to $47.3 million, representing 80 per cent of the surplus after tax. As directors, not shareholders, now approve all dividend distributions, the timing of the payment of the final dividend is no longer dependent on confirmation at the shareholders' annual meeting. Accordingly, and in order to provide an improved cash flow to shareholders, the directors have decided to pay the final dividend in October along with the distribution of the Annual Report.

Accordingly, the final dividend of 6.25 cents per share will be paid on 19 October 2001 to shareholders on the register at the close of business on 5 October 2001. The normal supplementary dividends, sourced from corresponding tax credits available to the company, will continue to be paid to qualifying non-residents.

Financial Position The company's total assets increased to $884.288 million ($841.323 million). Capital expenditure on fixed assets and investment properties totalled $69.449 million during the period. Fixed assets are valued on an optimised-depreciated replacement cost basis. A comprehensive valuation was undertaken at 30 June

http://www.auckland-airport.co.nz/Annual2001/directors_report.html (2 of 8) [3/13/2002 10:46:39 AM] AIAL Annual Report 2001 1999 and this will be reviewed every three years with any additions in the intervening period recorded at cost. Investment properties are independently revalued to market value each year. The effect of the revaluation at 30 June 2001 has been to increase the revaluation reserve by $0.112 million. The average capitalisation rate applicable for the revaluation to market at 30 June 2001 was 10.03 per cent. Additions to investment properties, inclusive of the revaluation increase, totalled $17.101 million for the year. The total value of the investment property portfolio increased to $81.192 million. In addition, a further three projects were under construction at year-end at a cost of $4.046 million; the estimated completion cost of these projects is over $7 million which would bring the value of the investment property portfolio to approximately $90 million. Shareholders' funds stood at $540.168 million at year-end ($499.946 million), representing a shareholders' funds/total asset ratio of 61.1 per cent (59.4 per cent). A change in the financial reporting standards issued under the Financial Reporting Act has meant that companies may no longer include a provision for a dividend payment unless the payment has been declared by directors prior to the period end. Accordingly, as the final dividend (amounting to $26.3 million) was only approved and declared on 30 August 2001, the Financial Statements do not include provision for the final dividend. The company's main debt funding is provided through long-term bonds ($200 million) and a commercial paper facility (maximum $150 million). At balance date, drawings under the commercial paper facility had reached $120 million. In order to provide additional funding flexibility the amount of the paper facility has, since balance date, been increased to a maximum of $250 million. The total borrowings of $320 million represents a debt/debt plus equity ratio of 37.3 per cent (37.2 per cent) and the interest on an EBIT basis was covered 5.0 times (5.1 times).

Pricing Regulation It is acknowledged by the company that airfield activities (presently 27 per cent of revenue) are supplied in a market where competition is limited. The current light-handed regulations are designed to ensure that the major airport companies do not abuse their market power. The regulations rely on a process involving: (i) Annual disclosure of financial performance and operating data. (ii) Consultation with substantial airline customers over potential price adjustments. (iii) Countervailing power of the airlines. (iv) Competition standards imposed by the Commerce Act. (v) The implicit threat of price control under the Commerce Act.

Disclosure Financial Statements

http://www.auckland-airport.co.nz/Annual2001/directors_report.html (3 of 8) [3/13/2002 10:46:39 AM] AIAL Annual Report 2001 In accordance with the requirements of the Airport Authorities (Airport Companies Information Disclosure) Regulations, the company has released its first set of Disclosure Financial Statements, being in respect of the 30 June 2000 year.

These are available on the company website. The Disclosure Financial Statements relate specifically and solely to identified airport activities, being airfield activities, aircraft and freight activities and specified passenger terminal activities.

The next set of Statements will be in respect of the 30 June 2001 year and will be released as required by the end of November 2001. Such Financial Statements must be filed on an annual basis.

In respect of the year ended 30 June 2000, the Disclosure Financial Statements illustrated the following performance of the three specifically identified airport activities: Airfield Terminals Aircraft+Freight

($000s) ($000s) ($000s) Revenue 44,953 45,182 4,704 Profit after 13,585 2,091 1,261 Tax Value of Assets 312,751 209,538 22,670 Employed Return 4.3% 1.0% 5.6%

Compared to the relevant weighted average cost of capital for these activities, which is in the range of 8.5 to 9.4 per cent, these returns cannot be deemed excessive. These return levels, together with the impact of the associated significant capital expenditure programmed over five years, necessitated the company seeking increases in both landing charges and terminal charges (the Airport Development Charge).

Industry Consultation Following the extensive consultation process, extending over an 11-month period, the company advised on 22 August 2000 new levels for both aircraft landing charges and the Airport Development Charge. Landing charges were set for the following three years with the charges increased on 1 September 2000 by 8.5 per cent, to be followed by an increase of 5.0 per cent on 1 September 2001 and also 5.0 per cent on 1 September 2002.

The Airport Development Charge, payable by all departing international passengers, increased from $20 to $22 effective 1 October 2000; $5 of this amount continues to be paid to the Government in respect of Civil Aviation and Aviation Security services.

The increases largely reflect recoveries against the cost of significant capital expenditure involved in the runway rehabilitation programme and on improved and extended public areas in the international terminal. Air New Zealand, the company's largest airline customer, has not agreed with the notified increases in landing charges. The airline has refused to pay the increase and has commenced Court action against the company, requesting a judicial review of the consultation http://www.auckland-airport.co.nz/Annual2001/directors_report.html (4 of 8) [3/13/2002 10:46:39 AM] AIAL Annual Report 2001 process. A hearing date for this review has been set down for February 2002. The company is strongly of the view that the consultation process followed, in all regards, the required process and the directors will be rigorously defending the Air New Zealand claim in the Courts. The costs incurred during the year in respect of the consultation process and for the Court hearing have amounted to approximately $1.0 million. At balance date, the unpaid portion of the Air New Zealand invoiced charges amounted to approximately $1.5 million. As the directors are firmly of the opinion the increased landing charges have been validly notified, this amount has been included in revenue for the year.

Commerce Commission Price Control Study In addition to the obligations under the regulations, the Commerce Commission has been asked by the Government to examine whether or not price control was necessary or desirable in respect of the three major New Zealand airports. The study commenced with initial submissions from interested parties presented to the Commission in April 2001. The company prepared a thorough submission advising in detail the basis of its landing charges and illustrating that price control was not necessary, nor was it desirable. The Commission issued a Draft Report on 14 July 2001 advising that it had formed a preliminary view that price control of Auckland's airfield pricing was justified. The Commission invited further submissions on the Draft Report and their preliminary findings, which the company further submitted on 14 August 2001 as required. The Commission's timetable then had cross-submissions to be filed by 31 August 2001, to be followed by a public conference canvassing the key issues to be held in the first two weeks of September. The date for a final report from the Commission is currently noted as 30 November 2001, although the final reporting date to the Minister remains 1 August 2002. In respect of the Commission's Draft Report, the company believes that, in reaching the basis of its preliminary view that price control might be considered, the Commission has used a number of incorrect financial facts, figures and assumptions; in addition, it has adopted some key economic principles that are either inappropriate or lack international or national acceptability.

In its submission, the company had explained to the Commission how the use of incorrect financial facts and figures may have arisen and had also included clear substantiation for the adoption of more traditional and widely used economic principles. The two major issues relate firstly to the appropriate methodology to be used for the valuation of the runways, taxiways and aprons and, secondly, the ability of the company to obtain a fair return on the land held for the future development of the second runway. The company believes that runway, taxiway and apron assets should be valued on an optimised-depreciated replacement cost basis as this method of valuation best replicates a competitive market

http://www.auckland-airport.co.nz/Annual2001/directors_report.html (5 of 8) [3/13/2002 10:46:39 AM] AIAL Annual Report 2001 position (ie the value a competitor would have to pay to create the same competitive asset today, after allowing for depreciation). The Commission, in its Draft Report, is of the view that an historical cost basis is a more appropriate valuation methodology to adopt. In respect of the second runway, the company believes that, as the utilisation of this runway is certain (currently a date of 2007/2008 is when initial operations may have to commence) and as the planning consent process is nearing completion, the investment is optimally timed and economically efficient. It is therefore appropriate for the company to earn a return on the bare land value of that specific parcel of land set aside for future airfield operations. The Commission is of the view that current users should only pay current costs and, on that basis, they have not allowed any return to the company on the land held for future runway development. These, and a number of other issues, have been canvassed in the company's submission. The Commission's Draft Report, in fact, endorses the methodology adopted by the company in many areas. It must be emphasised that their initial Report is only a draft and presents the Commission's preliminary view based on the assumptions and economic principles it has adopted at this point. Following submissions and the conference, it may very well be that the Final Report presents a different picture. Included in operating expenses for the year were costs of approximately $600,000 incurred in respect of preparation of the company's submission.

Nationality of Arriving Passengers for the year 2001 (for the year 2000)

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Stock Exchange Listings The company continues to have a primary listing on the New Zealand Stock Exchange together with a secondary listing on the Australian Stock Exchange.

Credit Ratings Standard & Poor's credit rating of A+ for long-term debt and A-1 for short-term debt has been retained.

Directors In accordance with the provisions of the company's Constitution, the Chairman, Mr Wayne Boyd, together with Mr Anthony Frankham, retire by rotation and, being eligible, offer themselves for re-election as directors.

Shareholders Auckland City Council remains the company's largest shareholder at 25.8 per cent, followed by the Commonwealth Bank of Australia Group who have increased their shareholding to 10.2 per cent. Manukau City Council continues to hold 9.6 per cent of the shares and Singapore Changi Airport Enterprises Pte Limited 7.1 per cent.

Shareholders in total number 54,954, which compares with 57,642 last year and the 67,787 immediately following the initial listing in July 1998.

During the year shares in the company traded in the range of $2.62 to $3.86.

Share Option Plans In accordance with the terms of the Employee Share Option Plan approved by shareholders in 1999, a further 1,195,000 options were granted to 31 executives during the year. The options were issued at the market value at the time of issue of $2.95 and will be adjusted for movements in the NZSE40 gross index and dividends paid. The options are exercisable after three years and lapse after six years. This brings the total number of options issued under the Plan to 2,240,000.

Staff The company's success over the years can be put down to the excellent service provided by staff at all levels throughout the organisation. Increasing activity levels, with record numbers of passengers having to be managed, places considerable pressure on our people. The Board is proud of its people and acknowledges that the excellent results reflect their continued efforts.

Outlook This year's excellent results reflect particularly positive growth across all sectors of the company's business.

It remains reasonable to anticipate that we can expect ongoing improvements in our key activity levels and financial performance again next year. On behalf of the Board

http://www.auckland-airport.co.nz/Annual2001/directors_report.html (7 of 8) [3/13/2002 10:46:39 AM] AIAL Annual Report 2001 Wayne Boyd, Chairman 30 August 2001

The Annual Meeting will be held 10.30am Wednesday, 21 November 2001 Newmarket Room Ellerslie Convention Centre Ellerslie Racecourse Greenlane Road Auckland

Airport Web Site Home Page

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Over a 24-hour period there are over 400 aircraft take offs or landings at Auckland International Airport. That equates to a multitude of passengers flowing through the terminals of New Zealand's major gateway - nearly 8.5 million passenger movements a year and increasing every year. In January 2001, a record 112,442 travellers went through the international terminal in one week. Inbound tourism forecasts remain strong and the ever-increasing passenger levels bring with them the need for new initiatives in customer service - and as the vision statement clearly states - service is a key delivery focus. The passenger activity levels at the airport reflect the fact that the New Zealand tourism industry had a record year with visitor arrivals increasing 11.5 per cent to close to 1.9 million for the year ended June 2001. Tourism industry forecasts predict annual visitor arrivals to reach 2.5 million in the year 2005.

In concert with this growth, Auckland Airport's ethos of first-class customer service is upheld with initiatives targeted to reinforce our reputation for safe, efficient, and secure delivery of passengers and cargo.

The presence of the Bluecoats - the company's hospitality ambassadors - is one such initiative that results in numerous compliments. This group of 150 volunteers is largely made up of older and retired people who, while doing a great job, also gain satisfaction from being able to use their extensive life skills. There is no doubt that the Bluecoats played a key role in Auckland International Airport being ranked 5th in the International Business Traveller magazine 2000 Award for Top 20 International Airports. Key customer service initiatives this year have included facility expansion at both the international terminal and the Air New Zealand

http://www.auckland-airport.co.nz/Annual2001/passengers.html (1 of 2) [3/13/2002 10:46:48 AM] AIAL Annual Report 2001 domestic terminal. The Air New Zealand domestic terminal project has included the extension of the first floor gate lounge, the addition of a fourth passenger boarding bridge, and a major renovation of the Wings Café. The company is focused on further reinforcing Auckland International Airport's position as Gateway to the Pacific, and as one of Australasia's most popular destinations. We will do this while remaining a company that is committed to first-class customer service.

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A safe runway is fundamental to the operation of any airport; it is crucial to ensure that it is always able to cope with the demands placed on it. Auckland International Airport operates with a single runway that was constructed in 1965. Engineers at the time estimated the runway had a life of around 20 years, before any significant maintenance was required, based on the operational aircraft of the day, which were predominately Boeing 707s and DC8s. These original estimates proved to be quite accurate as some 25 years later the runway started to show signs of deterioration, despite an increase in the number of aircraft movements and the increase in size and weight of new generation aircraft, principally Boeing 747s. In 1994, the company began a unique and comprehensive runway maintenance programme. Based on injecting epoxy resin into the hardfill material beneath the concrete slabs, that were showing signs of deterioration, the maintenance programme has greatly assisted in prolonging the life of the runway slabs.

However, monitoring of the condition of the runway slabs indicated that, by 1998, a comprehensive slab replacement programme was required for both the single runway and the Main Taxiway.

When an airport has only one runway and it is nearing the end of its lifespan, the challenge of keeping the airport operational while that single runway is being replaced is significant. The answer to the problem in the airport's case involved converting the Main Taxiway into a standby runway. With this ready access to an alternative runway the current runway can be reconstructed section by section over a period of years. The programme, which will run in excess of five years at a total cost of around $140 million, sees the replacement of the original 350 mm thick concrete slabs, on the Main Runway and Main Taxiway, with new

http://www.auckland-airport.co.nz/Annual2001/runway.html (1 of 2) [3/13/2002 10:47:28 AM] AIAL Annual Report 2001 500 mm thick slabs. The new concrete will have a lifespan of at least 40 years and will cope with the increased weight of the even heavier aircraft that are expected to be flying into Auckland within the decade. Another innovation by the company was the recycling of the removed concrete slabs, each weighing approximately 27 tonnes. These have been progressively crushed and recycled into the preparation of the base for the new concrete. Over 25,000 tonnes of aggregate has been reused via this programme. The slab replacement programme commenced in 1998 with extensions to both ends of the First Taxiway. In 1999 a critical eastern section of the Main Runway was replaced without significant interference to operational traffic. The replacement of the taxiway slabs, and the widening of the taxiway to enable runway operations, commenced in 2000 and will be completed later this year. The rehabilitation of the midsections of the Main Runway is scheduled to commence in April 2002 and will be carried out in stages, section by section, on an as required basis.

Airport Web Site Home Page

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Amid the comings and goings of travellers through Auckland International Airport's terminals there is another serious business going on - shopping. Everybody wants to join in, not just airline passengers. So the latest major redevelopment of the Jean Batten International Terminal has been designed to not only cope with rapidly expanding passenger flows, but with the retail needs of both travellers and the non-travellers in mind. The latest $20 million international terminal expansion is designed to deal with the recent 11 per cent increase in international arrivals, and also tourism industry forecasts that indicate visitor growth from today's 1.9 million a year to 2.5 million in 2005. The first step in the current expansion programme, completed in December 2000 at a cost of $6 million, was additional check-in and baggage handling facilities. The next stage of development was to provide additional space for the general public, especially in the departure and shopping area on the first floor where congestion has been particularly heavy.

The First Floor Project expands the floor space over the inner forecourt road, north towards the car park, creating an additional 2,550 sqm of floor space. This will give more quality space for visitors in the departure hall area as well as additional retail space. New retailers on the first floor will include Line 7 America's Cup, Nature's Window, Flying Saucers, Beach Culture, Sunglass Hut/Watch Station, Healthy Living, Sounds Music and an extended Artport store. Food and beverage facilities are also being upgraded and expanded.

http://www.auckland-airport.co.nz/Annual2001/retail.html (1 of 2) [3/13/2002 10:47:43 AM] AIAL Annual Report 2001 A "sky bridge" extension will run from the northern end of the first floor across the outer forecourt road to a new set of escalators, which will take visitors directly to and from the public car park. The first floor extension will also act as an overhead canopy on the inner forecourt road, providing all-weather protection for drop-off and pick-up of passengers. The increased facilities will dramatically improve passenger flows and customer service levels in this important area of the terminal. The expansion is due for completion in November 2001, ready for the peak summer holiday season.

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The two most notable developments this year have been the completion of the DHL complex - offices, warehouse and a new sealed apron which enables cargo aircraft to taxi to within 15 metres of the cargo processing area - and the Airport Shopping Centre on the corner of George Bolt Memorial Drive and John Goulter Drive. Auckland International Airport has 265 hectares of land set aside for commercial development. Within this area three particular development parks to support the infrastructure and the people working at and visiting the airport have been identified. These parks encompass a Commercial Park of 25 hectares, a Business Park of 15 hectares and a Shopping Centre area of five hectares. Full development of these parks will take an estimated 10 to 12 years. The Airport Commercial Park targets primarily logistics and distribution operators with room for some light industrial use. Developments within this area include Vehicle Testing New Zealand, TNT and Exel (previously Total Logistics).

The Airport Business Park is designated for offices, retail services, and call centres. These potential technology-oriented users have at their disposal a high level of existing infrastructure, such as the airport's Local Area Network and other telecom and utility facilities, which are already in place. Developments within this area include a 1300 sqm property for New Zealand's new giant dairy company Fonterra, Bank of New Zealand offices, and a McDonald's drive-through restaurant. The Airport Shopping Centre is proving to be a popular destination for the 7500 people who work at the airport plus the eight million passengers who use the airport each year. The Centre commenced operation with the opening of the 5000 sqm The Warehouse store and four specialty stores in November 2000. The opening of a

http://www.auckland-airport.co.nz/Annual2001/property.html (1 of 2) [3/13/2002 10:47:49 AM] AIAL Annual Report 2001 round-the-clock, 2000 sqm Foodtown supermarket on 1 October 2001 will further enhance the Airport Shopping Centre. Completion of the current projects will see the value of the property investment portfolio reach over $90 million.

Airport Web Site Home Page

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The company takes its citizenship responsibility seriously and has an active association with the surrounding community. In particular, it has strong commitment to help advance children's education and has made a number of practical educational contributions to the community. The airport company's educational initiatives include the major sponsorship of Life Education Trust mobile classrooms, a health-based programme for children in their formative years that is now operating in the adjoining suburbs of Papatoetoe, Mangere and Otahuhu. Direct links with the airport are achieved through the educational airport tours programme operated on the company's behalf by Jean Batten Primary School of Mangere. And company employees are involved in a very successful mentoring programme with the adjacent secondary school, Aorere College.

The airport's website section for children has recently been identified by Teaching Online as one of New Zealand educational "super sites."

Through spectator donations to South Auckland Health Foundation's Kidz First, children will also be beneficiaries of the company's major sponsorship the Auckland Airport ~ Regency Three Day Event. Held at Manukau City's Puhinui Reserve on 7-9 December, the event is New Zealand's largest equestrian event and this year will take on a new country theme with a wider programme of rural activities for people of all ages.

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Left to right: Wayne Boyd, Chairman; Anthony Frankham; John Goulter

Left to right: Joan Withers; Michael Smith; Sir Wilson Whineray

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Top, left to right: John Goulter, Managing Director; Chris Curley, General Manager, Corporate and Corporate Secretary Middle, left to right: Murray Barclay, General Manager, Commercial; David Hansen, General Manager, Operations; Stephen Reindler, General Manager, Engineering Bottom, left to right: Paul Mens, General Manager, Finance and Information Technology; Christine Carter, Executive Manager

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McDermott Fairgray's recent assessment of the economic impact of Auckland International Airport on both the Auckland and New Zealand economies found that by any measure, the airport is a major economic infrastructure component within New Zealand providing significant economic benefit for all New Zealanders. While almost half of this beneficial economic impact is realised within the Auckland region, the remainder provides a stimulus for the rest of New Zealand. In the New Zealand economy Auckland Airport: Generates and facilitates $14.17 billion worth of value added and; Directly or indirectly sustains around 235,780 full-time equivalent jobs.

These impacts equate to nearly 14 per cent of national gross domestic product (GDP) and over 15 per cent of national employment. The largest national impacts can be attributed to: International freight $5.21 billion International tourism $4.62 billion Domestic freight $2.39 billion

In the Auckland economy, Auckland Airport: Generates and facilitates $6.91 billion worth of value added and; Sustains 112,980 full-time equivalent jobs.

These impacts equate to 20.7 per cent of Auckland region GDP, and 22.5 per cent of employment. The largest impacts on Auckland result from: International freight $2.53 billion Facilitation of international travel $1.71 billion Associated business $1.41 billion

The value added to the New Zealand economy is equivalent to $3,600 for every man, woman and child. The value to the Auckland economy is equivalent to approximately $20,000 per household.

The number of jobs generated in the Auckland region by Auckland Airport is equivalent to the total population of Hamilton.

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Interesting Facts

http://www.auckland-airport.co.nz/Annual2001/economic_impact.html (3 of 4) [3/13/2002 10:48:13 AM] AIAL Annual Report 2001 81 percent (905,000) of domestic travellers and 87 percent (1.25 million) of international arrivals through Auckland International Airport travel for leisure purposes, the remainder for business. International leisure visitors spend an average of $2,300 (excl. GST) in New Zealand, while business visitors spend $2,500 (excl. GST). 700,000 New Zealanders departed Auckland International Airport for leisure purposes, the remaining 186,000 for business. 30 percent (482,000) of domestic flights were taken by international visitors, the remaining 70 percent (1.12 million) by New Zealand residents. Some 73.9 percent of New Zealand air exports and 89.4 percent of New Zealand air imports (by value) are handled by Auckland International Airport. The largest export volumes through Auckland International Airport are horticulture at 13,245 tonnes and hunting and fishing at 11,777 tonnes. The largest import volume is machinery and equipment manufacture at 25,093 tonnes, followed by textile and apparel manufacture at 11,007 tonnes. The highest export and import values through Auckland International Airport belong to machinery and equipment manufacture at $1.17 billion and $3.79 billion respectively.

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The operation of a business as dynamic and influential as Auckland International Airport will continue to present both challenges and opportunities. In terms of financial results the outcomes for the year were again extremely positive, while the continued development of airport facilities reflects the ever-increasing economic significance of the overall Auckland Airport site. As New Zealand's largest and busiest airport, Auckland International Airport handles large volumes of aircraft, passengers and cargo. It also provides a service base for the aviation and related industries. The airport is fast developing into a "city" in its own right. It generates business directly through its own operations and facilitates a great deal more business activity throughout the Auckland and New Zealand economies. During the year the company commissioned McDermott Fairgray to review the economic impact assessment of Auckland International http://www.auckland-airport.co.nz/Annual2001/md_review.html (1 of 15) [3/13/2002 10:48:25 AM] AIAL Annual Report 2001 Airport for Auckland and New Zealand. This review built on three earlier studies previously undertaken, over the past 10 years. The review showed that the airport generates and facilitates some $14.17 billion worth of value added in the New Zealand economy, directly or indirectly sustaining more than 235,000 full-time equivalent jobs. This effect equates to 13.9 per cent of national GDP and 15.3 per cent of national employment. In the Auckland region the effect is even more significant; 20.7 per cent of GDP and 22.5 per cent of employment. The airport will increasingly play a key role in both national and regional economies, particularly given the major contribution of international tourism as New Zealand's single biggest foreign exchange earner. Most of these visitors come by air and 70 per cent use Auckland International Airport. The statistics for domestic travel movements and both local and overseas airfreight are equally impressive. The dynamics of the business are confirmed by the growth for the year in our key business drivers - aircraft landing weight up 3.4 per cent, international passenger movements up 5.0 per cent and domestic passenger movements up 5.5 per cent.

In dealing with this growth, the company tackled a range of key development projects during the year. They included managing more passengers and more aircraft at peak times, continuing the runway rehabilitation programme and expansions to the international terminal building.

Looking forward, we remain confident that we can continue to wisely manage the infrastructure development on which such an important economic hub is based.

Passengers Overall for the period a record 8,424,164 passenger movements were recorded, up 5.2 per cent on last year's 8,006,042. International passenger movements rose 5.0 per cent, from 4,799,236 to 5,040,922 (including transits and transfers). This increase includes a reduction in transit and transfer passenger movements from 525,254 to 391,568. Excluding transits and transfers, international passenger growth was up 8.8 per cent (to 4,649,354). Significantly, during the 2000 Christmas period the company, for the first time, handled in excess of 100,000 international passengers in a week; a record of 112,442 international passengers processed during the week ended 23 January 2001. The positive increase in international passengers mainly reflects the continued growth in tourism. The tourism industry had another buoyant year with a record 1,884,358 short-term visitor arrivals, an 11.5 per cent increase for the year ended June 2001. It is expected the milestone of 2 million visitors in a 12-month period will be passed for

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Domestic passenger activities totalled 3,383,242, representing a 5.5 per cent increase over last year's 3,206,806. This increase in domestic passenger levels is attributed in part to changes in the domestic airline market with the introduction of "low fare" carrier services (such as Freedom Air) as well as the strong inbound tourism market.

The 5.0 per cent increase in international passengers had a correspondingly positive effect on income from both the Airport Development Charge and airport retail operations. Airport Development Charge income was further enhanced by the increase of $2 per departing passenger (to $22) effective from 1 October 2000. Airlines Serving Auckland International Airport

International

Aerolineas Argentinas, Air Canada, Air New Zealand, Air Pacific, Air Tahiti Nui, Air Vanuatu, Aircalin, American Airlines, Britannia Airways, British Airways, Canada 3000, Canadian Airlines, Cathay Pacific Airways, China Airlines, EVA Air, Freedom Air, Garuda Indonesia, Japan Airlines, Korean Air, Lan Chile, Lufthansa Airlines, Malaysia Airlines, Mandarin Airlines, Mexicana, Polynesian Airlines, Qantas Airways, Royal Tongan Airlines, Singapore Airlines, Thai Airways International, United Airlines

Domestic

Air New Zealand Link, Air New Zealand National, Origin Pacific Airways, Qantas Airways, Freedom Air

Commuter

Air National, Great Barrier Airlines, Mountain Air, Christian Aviation

Cargo

Air Freight NZ, Air Post, Asian Express Airlines, Cargolux International, Emery Worldwide, Evergreen International, Federal Express, Polar Air, Singapore Airlines, Atlas Airfreight, Malaysia Airlines, Korean Airlines http://www.auckland-airport.co.nz/Annual2001/md_review.html (3 of 15) [3/13/2002 10:48:25 AM] AIAL Annual Report 2001

Airlines International At year-end the company had a total of 30 international airlines which continue to provide services to Auckland. However, Air China, from the People's Republic of China, ceased operation in April 2001. The airline had operated at the airport since July 2000 and was flying to Auckland via Sydney. Stringent visa requirements that apply in Australia, even in respect of transitting passengers, meant this service was not economically viable. In June 2001, Aerolineas Argentinas suspended operations on a number of international routes including Auckland as part of a cost reduction drive. The supply of service between Auckland and Buenos Aires has in part been replaced by Qantas Airways increasing the frequency of its South American service, which is routed Sydney/Auckland/Buenos Aires return. Aerolineas Argentinas had operated at the airport since December 1984. Changes to route structure have also occurred for United Airlines. After 16 months of operating a Los Angeles/Auckland return service, the airline has reverted to its traditional service route of Los Angeles/Auckland/Melbourne return.

However, it is the fleet structure changes recently announced by both Singapore Airlines and Qantas Airways that will have a significant impact on future development planning for the company. These airlines have respectively ordered 10 and 12 Airbus A380 aircraft, which are due for delivery between 2006 and 2011. In order to be able to efficiently handle these aircraft there will be a need for further expansion of the international terminal, either through the addition of a western pier to the existing building, or through development of a separate regional terminal and pier. Whichever option is deemed most appropriate, it can be accommodated.

Domestic During the year the company witnessed a major change in the domestic airline market.

On 21 April 2001 Tasman Pacific Airlines of NZ Ltd went into receivership and its operations at Auckland Airport ceased. This was not the first time the company has been left with unpaid debts from fledgling airlines and in this case the amount involved was approximately $600,000. The gap left by Tasman Pacific was quickly filled by Qantas Airways as a domestic main trunk operator. Originally using the international terminal, services are now operated from the former Ansett New Zealand terminal. At the same time, Origin Pacific, which now has an association with Qantas Airways to carry passengers between main trunk and regional airports, substantially increased its domestic operation at the airport. Domestic competition was further increased on 1 May 2001 when Freedom Air commenced a "low cost" domestic operation from the Air New Zealand terminal. Finally, there has been considerable discussion as to whether or not Virgin Blue will start domestic operations in New Zealand. To date, the

http://www.auckland-airport.co.nz/Annual2001/md_review.html (4 of 15) [3/13/2002 10:48:25 AM] AIAL Annual Report 2001 Government has not provided the airline with a New Zealand operating licence. If and when this occurs, the company will also look to accommodate the requirements of Virgin Blue. Despite the fluctuation in domestic airline operators, the demand for domestic service has remained strong. The introduction of "low fare" operators has increased competition and tapped into a new passenger market. It is expected that this change in the domestic environment should well prove positive for the company. The subject of the "ownership" of Air New Zealand has been featured by the media for most of this calendar year. Both Singapore Airlines and Qantas Airways have featured in very considerable public debate and ongoing media comment. However, it is not appropriate for us to promote any point of view relative to these most important customers of the company. We do, though, look forward to an outcome beneficial to all concerned and for New Zealand as a nation.

Aircraft The number of aircraft movements totalled 147,868, representing only a marginal 0.1 per cent increase over last year's 147,769. While international aircraft movements increased 6.8 per cent to 29,557 (27,664), domestic movements were down 1.5 per cent to 118,311 (120,105). Domestic aircraft movements reduced as a result of the demise of Qantas New Zealand and a reduction in general aviation and non-scheduled movements.

MCTOW Landing fees for aircraft are based on the maximum certified take-off weight (MCTOW) of the aircraft. The company's total MCTOW for the year increased 3.4 per cent, from 4,505,896 tonnes to 4,659,701 tonnes. http://www.auckland-airport.co.nz/Annual2001/md_review.html (5 of 15) [3/13/2002 10:48:25 AM] AIAL Annual Report 2001

Cargo Cargo tonnage decreased 2.5 per cent to 186,954 tonnes (191,679 tonnes) during the period. However, according to Statistics New Zealand, the value of exports and imports through Auckland International Airport increased approximately 8 per cent over the previous year.

Runway Issues The major programme for the rehabilitation of the company's single runway, taxiways and aprons continued during the year. In what was year three of the projected five-year project, the company undertook significant pavement construction work involving the taxiway to runway conversion and the construction of two layover (parking) stands for international aircraft. In addition, with the planned use of the main taxiway by large aircraft during the later stages of the runway rehabilitation programme, work was undertaken to provide the necessary clearance for these aircraft between the first taxiway and the domestic terminal apron gates. This work involved repositioning gates and air bridges and extending the passenger gate lounge.

Expenditure on these works amounted to $20.9 million, of which $6.5 million is attributed to the two layover stands. To date, a total of $55.0 million has been spent on this project which, when complete, it is envisaged will have cost $140.0 million.

Because of a growing demand for parking aircraft on the international apron, the company needs to provide a further five aircraft layover stands by December 2001. To maximise the versatility and use of the apron area, four of these stands will be located between the domestic and international terminal buildings. Expenditure on these additional works is budgeted to be $8.0 million.

Second Runway Mediation In May 1998 the Manukau City Council released a decision on the airport provisions in the Manukau District Plan which confirmed approval for a second runway to the north, while imposing requirements on the company to make offers to insulate noise-affected houses in the path of both the existing and proposed second runway. After three years of mediation between Manukau City Council, Auckland International Airport Limited, Residents Against the Northern Runway, Board of Airline Representatives of New Zealand, Housing NZ, Auckland Healthcare Services Limited and the Ministry of Education, the company is hopeful that a satisfactory outcome can be reached which will open the way for future growth at the airport.

Jean Batten International Terminal Development Projected higher international passenger activity levels and concern at the extremely high levels of public space utilisation provided a catalyst for extensions to the international terminal. The construction of six new check-in counters and additional baggage capacity, involving capital expenditure of $6.4 million, was completed in time to accommodate the December 2000 passenger peaks. However, the continued growth in the airline hubbing schedules (peak-time utilisation) has placed further strain on terminal facilities

http://www.auckland-airport.co.nz/Annual2001/md_review.html (6 of 15) [3/13/2002 10:48:25 AM] AIAL Annual Report 2001 during the early morning, midday and early evening periods. While a hubbing schedule can be efficient for passengers and the airlines, it also results in lengthy periods of each day where facilities are primarily under-utilised, and peak periods of the day where the facilities are over-utilised - an inefficient use of the airport infrastructure. Compounding the terminal capacity issue is the fact that the current annual growth rate for international visitor arrivals to New Zealand is averaging 11 per cent, and the Tourist Research Council is forecasting arrival levels of 2.5 million in 2005 (currently just on 1.9 million). Maintaining a high level of service with a hub schedule requires careful focus on the timing of terminal infrastructure expansion. Reviews of the passenger activity forecasts for summer 2002, the Tourist Research Council forecasts, and the current levels of service, prompted the company to commission further facility expansion projects in the following three areas of the Jean Batten International Terminal: First floor public and retail area: $20.5 million, to be completed November 2001. The first floor is to be expanded over the inner forecourt road to a total area of 8,100 sqm. The addition will increase the public space area by 1,450 sqm, to 4,450 sqm, and the landside retail areas by 1,100 sqm, to 3,650 sqm. Arrivals secondary processing area (beside the Visitor Information area): expansion of this area, at a cost of $1.2 million, to be completed December 2001. The need for this project is in response to the Ministry of Agriculture and Forestry requiring extra space to enable the 100-per-cent screening of all arriving bags and passengers. Immigration arrival express clearance at duty free stores: this innovation will enable duty free customers to obtain immigration clearance adjacent to these retail outlets and have express access to the baggage claim area. This project will also be completed December 2001.

Completion of these projects will see the international terminal building expanded to a total size of 81,475 sqm.

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Revenue Analysis ($m) 2001 % 2000 % change Retail Income 56.6 30 50.6 11.8 Airfield Income 50.8 27 46.4 9.5 Development Charge 30.9 16 6.0 18.9 Rental Income 17.9 10 16.1 10.7 Terminal Services Charge 15.2 8 14.2 7.2 Car Park Income 11.6 6 11.3 3.0 Utilities and General 6.4 3 5.4 18.3 Total 189.4 100 170.0 11.4

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Expenditure Analysis ($m) 2001 % 2000 % change Depreciation 30.7 30 29.5 4.2 Net Interest 19.8 20 18.5 6.9 Repairs and Maintenance 16.7 17 18.4 -9.5 Staff 20.2 20 17.6 15.2 General 11.6 11 8.5 36.8 Rates and insurance 1.8 2 1.8 - Total 100.8 100 94.3 6.9

Retail Revenue from retail concessions increased 11.8 per cent, from $50.6 million to $56.6 million. The increase can be attributed to both the 8.8 per cent increase in international passenger movements as well as an increased spend rate per passenger. It is anticipated that the 40 per cent expansion of the landside retail area on the first floor of the international terminal and an additional number of smaller retail projects will provide further positive increases in retail earnings in the coming year. There will be 11 new retail outlets on the first floor of the international terminal - ranging from gift, apparel and accessory stores to food and beverage outlets. The company's online tax and duty free shopping web site (www.airportshoppers.com) which commenced operation on 1 August 2000, continues to increase in popularity. The number of people visiting

http://www.auckland-airport.co.nz/Annual2001/md_review.html (9 of 15) [3/13/2002 10:48:25 AM] AIAL Annual Report 2001 the site has exceeded expectation. Currently the majority of visitors to the web site are from New Zealand, although the greatest number of the purchasers are from the United States, Great Britain and Asia.

Property Revenue from property rentals increased 10.7 per cent to $17.9 million ($16.1 million). Property rental income is sourced from the company's 26 investment property sites as well as considerable office space in the international and domestic terminals. Four new design-build projects, representing a combined investment of over $18.0 million (bringing the value of the investment property portfolio to $81.142 million), were completed during the year. The four projects were: The Airport Shopping Centre which opened in November 2000. This complex includes a 5,000 sqm The Warehouse store and garden centre, plus four other retail outlets totalling 2,000 sqm. In April 2001, a design-build facility, including 2,500 sqm of warehouse, was opened for DHL New Zealand Limited. The site advantage for DHL is the direct access link between the warehouse and the airside apron. TNT Express Worldwide (NZ) Limited took possession of a purpose-built facility in October 2000. The facility includes 780 sqm of offices, 1,160 sqm of clearspan warehouse space and 210 sqm of canopy. In May 2001, a 1,300 sqm office block building was completed for Kiwi Co-operative Dairies Limited. With the company mergers which have taken place, the office space now houses the Fonterra Co-operative Group Limited corporate office.

The development projects in progress at year-end included a 2,700 sqm office and distribution centre for Federal Express (completed July 2001) and a 2,000 sqm Foodtown supermarket as an addition to the Airport Shopping Centre (to be completed in October 2001).

The Airport Shopping Centre has traded ahead of expectation and has proven to be a very convenient retail centre for airport staff and visitors. Concept plans are under way for Stage II of the development. The company has continued to examine the potential for a hotel at the airport. It is hoped that this project will come to fruition in the present financial year. In all cases, the investment properties are built and owned by the company following the negotiation of long-term commercial leases.

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Car Parks To service increased demand, car park expansions were made to both staff (64 spaces) and long-term public (342 spaces) in December 2000. Demand is such that an additional 660 car park expansion is also being undertaken, for completion by November 2001.

On completion of this expansion, total car park numbers on-airport will be approximately 11,600, including tenant spaces of 5,000.

Information Systems The airport manages a diverse range of activities - from retail and property, to car parks, terminals and runways. The increased diversity of operations, together with the newly introduced financial reporting requirements under the Airport Authorities (Airport Companies Information Disclosure) Regulations and the detailed information requirements associated with the ongoing pricing consultation process, has meant more sophisticated reporting systems were required. A new system, based on J D Edwards' One World software, was selected and satisfactorily installed in July 2000. Flexibility for growth was an integral part of the new system design.

Consulting Services The company has a small consulting services capability that covers a range of airport disciplines - from operations, emergency response and infrastructure, to project management. A recent consulting assignment involved providing management advice to the Airport Authority of the Cook Islands (AACI) through a project funded by New Zealand Overseas Development Aid. The project focused on an evaluation of the terminal development needs for Rarotonga Airport and the runway rehabilitation needs at Aitutaki Airport.

Community Activities The company, as part of its community association, has a keen interest

http://www.auckland-airport.co.nz/Annual2001/md_review.html (11 of 15) [3/13/2002 10:48:25 AM] AIAL Annual Report 2001 in children's education and a commitment to helping to educate. Educational initiatives include: Life Education Trust Mobile Classrooms The company has been the major sponsor of the Life Education Trust in the Mangere and Onehunga areas for several years now. This highly successful health-based programme is provided free to children in their formative years through primary and intermediate schools. Recognising the success of this educational programme, the company has extended its sponsorship of the mobile classrooms to the adjoining suburb of Papatoetoe. With two educators and two mobile classrooms, 20,000 children a year can experience the programme.

School Tours Auckland International Airport has acted as an educational resource for a number of years. Supporting a local school, the company contracts Jean Batten Primary School to manage the programme, whereby school groups are able to tour and learn about the airport.

Aorere College Airbridge Mentor Programme Aorere College, the closest secondary school to the airport, benefits from a very successful mentor programme. Known as Airbridge, the programme brings airport company employees and students together on a regular basis. Each year approximately 100 students and 25 staff members are involved.

Children's Web site There is a mystery section to the airport's corporate web site (www.auckland-airport.co.nz/Kidsite/) specially for children. Bright, colourful and fun, it is informative, educational and helpful for children carrying out school projects or simply spotting aircraft. Teaching Online (a New Zealand-based web site maintained by teachers) has identified the airport's site as one of New Zealand's educational "super sites".

Sponsorships Auckland Airport - Regency Three Day Event - A Manukau Country Festival For the past seven years the company has been the major sponsor of New Zealand's premier equestrian Three Day Event. A showpiece occasion for the region, this year the company welcomes Regency Duty Free who joins as the new title sponsor of the event. Held 7 to 9 December at Manukau City's Puhinui Reserve, the event this year will take on a new country theme with a wider programme of rural activities. Admission will be free, and the South Auckland Health Foundation Kidz First joins the event as the recipient of donations.

Awards Receiving an award is one way that the company can be officially http://www.auckland-airport.co.nz/Annual2001/md_review.html (12 of 15) [3/13/2002 10:48:25 AM] AIAL Annual Report 2001 recognised and honoured for its outstanding performance. It also provides an excellent opportunity to further encourage ongoing improvements across all areas of business and endorse the company's efforts to be regarded as a premier international airport. This year the company received a Distinction Award at the prestigious New Zealand Tourism Awards. The award was in recognition of the company having received the following national tourism awards in the past four years: New Zealand Tourism Awards 2000 Winner, retail category, Retail Takes Flight / A World of Shopping

2000 Bluecoats (Hospitality Ambassadors) Innovation Award for Human Resource Development

1998 Winner, retail category, A World of Shopping

1997 Winner, events category, Auckland Airport Three Day Equestrian Event

Airports Council International (ACI) Pacific is an international organisation that fosters co-operation among airports. In their recent Communications Contest, the company's 2000 Annual Report was placed 1st and the Fact Book 2nd.

Web site communication has become a key tool for the company so it was pleasing that in November 2000 the retail web site (www.airportshoppers.com) was a runner-up in the Netguide Web Awards for Best E-tail category.

In October 2000 the International Business Traveller magazine published its world airline and world airport rankings in which Auckland International Airport featured prominently: Top International Airports - Auckland (5th) Best Airport Shopping - Auckland (th) World's Most Efficient Airports - Auckland (6th)

These rankings further endorse the company's efforts to have Auckland rank as a premier airport in the world.

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Joint Venture Companies HMSC-AIAL Limited The company continues to have a 50 per cent shareholding in HMSC-AIAL Limited which provides food and beverage services at the international terminal. The financial result for the joint venture was significantly ahead of the previous year. This reflects increased visitor numbers and additional improvements in operating efficiencies over the period. A new food outlet in the first floor expansion area is anticipated to further enhance the activities of this venture.

Waste Resources Limited Post balance date the company sold its quarantine incineration operation into a new joint venture company, Waste Resources Limited. The new entity is a 50/50 joint venture with the French-owned company, Tredi (NZ) Limited. Tredi is one of Europe's largest hazardous and industrial waste disposal organisations.

The company anticipates that the Waste Resources operation, with input from Tredi, will be able to be further developed and expanded.

Our People The company prides itself in having an excellent relationship with its 282 employees, many drawn from Manukau City and its environs.

Carrying out a wide range of activities from runway maintenance and aircraft parking to retail and property development, the company's employees have diverse roles in what is essentially a service organisation. Consistent, high-quality customer service is critical to the company's ongoing success. Meeting all customer needs 24 hours a day, seven days a week, often with construction in progress, is an ongoing challenge to the company and its staff. The past year has been particularly demanding and the contribution of staff at all levels is greatly appreciated.

Company Vision At the end of 2000 all employees attended what was termed a "Future Focus" seminar. Its purpose was to briefly reflect on the past and to provide an opportunity for all employees to share their ideas on the future of the airport. For all involved it was a tremendously positive experience. A key outcome was the decision to update the company's aims and philosophy statement which had been in use since 1989. Although in the main still pertinent, a simpler more precise statement was sought http://www.auckland-airport.co.nz/Annual2001/md_review.html (14 of 15) [3/13/2002 10:48:25 AM] AIAL Annual Report 2001 by all. The adoption of this new vision statement encapsulates the company's future focus, its values and the commitment of its staff. The new statement is featured on page 2 of this Report.

Outlook The completion of the first floor expansion project in late November 2001 will provide a new image to the international terminal. Retail opportunity designed for visitors to the terminal who may not be travelling heralds further innovation by the company. Similar innovation will be the advent of a 24-hour supermarket on-airport. Tourism numbers appear set to further grow significantly over the next few years as interest in New Zealand as a preferred destination consolidates. Such growth continues to provide very real opportunities for us and our ability to move quickly to accommodate market requirements - whether within property investment, retail or infrastructure development is - I believe, now well accepted. Accordingly, a year of positive growth can again be anticipated.

John Goulter, Managing Director 30 August 2001

Airport Web Site Home Page

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STATEMENT OF FINANCIAL PERFORMANCE For the year ended 30 June 2001

STATEMENT OF MOVEMENTS IN EQUITY For the year ended 30 June 2001

STATEMENT OF FINANCIAL POSITION As at 30 June 2001

STATEMENT OF CASH FLOWS For the year ended 30 June 2001

NOTES AND ACCOUNTING POLICIES

AUDIT REPORT

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for the year ended 30 June 2001

2001 2000 Notes $000s $000s

Operating Revenue 3 189,363 169,990

Expenses 4 Operating expenses 50,256 46,241 Depreciation 30,730 29,488 Net interest 19,792 18,522

100,778 94,251

Surplus before Taxation 88,585 75,739

Taxation expense 5 29,332 25,005

59,253 50,734

Associate company 6 (143) 319

Surplus after Taxation 59,110 51,053

The Notes and Accounting Policies form part of and are to be read in conjunction with these financial statements.

Airport Web Site Home Page

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for the year ended 30 June 2001

2001 2000 Notes $000s $000s

Equity at beginning of period 499,946 510,189 Surplus after taxation 59,110 51,053

Movement in investment property revaluation reserve 18 112 2,544

Total recognised revenues and expenses 59,222 53,597

Increase in share capital 12 2,000 -

Dividends paid 7 21,000 63,840 Equity at end of Period 540,168 499,946

The Notes and Accounting Policies form part of and are to be read in conjunction with these financial statements.

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as at 30 June 2001

2001 2000 Notes $000s $000s Non-current Assets Fixed assets 8 785,527 767,955 Investment properties 9 81,192 59,933 Investment in associate company 6 2,096 2,239 868,815 830,127

Current Assets Inventories 446 314 Prepayments 2,194 3,320 Accounts receivable 11 12,833 7,562 15,473 11,196

Total Assets 884,288 841,323 Shareholders' Equity Issued and paid up capital 12 212,000 210,000 Retained earnings 44,190 6,080 Fixed asset revaluation reserve 17 258,545 258,545 Investment property revaluation reserve 18 25,433 25,321 540,168 499,946 Non-current Liabilities Term borrowings 13 320,000 290,000 Other term liabilities 551 538 320,551 290,538 Current Liabilities Bank overdraft 10 136 1,186 Accounts payable 14 21,737 20,797 Dividend provision 7 - 21,840 Taxation provision 396 516 Current portion of borrowings 13 1,300 6,500 23,569 50,839

Total Equity and Liabilities 884,288 841,323

The Notes and Accounting Policies form part of and are to be read in conjunction with these financial statements.

Signed on behalf of the Board

Wayne Boyd, Chairman of the Board Michael Smith, Director 30 August 2001 30 August 2001

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for the year ended 30 June 2001 2001 2000 Notes $000s $000s Cash Flow from Operating Activities Cash was provided from: Receipts from customers 182,695 169,183 Interest received 653 137 Dividend from associate 550 -

183,898 169,320

Cash was disbursed to: Payments to suppliers and employees 38,951 35,014 Income tax paid 29,452 25,011 Other taxes paid 368 443 Interest paid 19,061 21,308 GST paid 10,713 11,475 98,545 93,251 Net cash flow from operating activities 15 85,353 76,069 Cash Flow from Investing Activities Cash was provided from: Sale of assets 68 124 Repayment of advances from associate - 532 68 656 Cash was applied to: Purchase of fixed assets & expenditure on investment properties 66,493 44,162 Interest paid - capitalised 1,838 - 68,331 44,162 Net cash used in investing activities (68,263) (43,506) Cash Flow from Financing Activities Cash was provided from: Increase in share capital 12 2,000 - Increase in borrowings 354,800 485,700 356,800 485,700 Cash was applied to: Decrease in borrowings 330,000 455,000 http://www.auckland-airport.co.nz/Annual2001/cashflows.html (1 of 2) [3/13/2002 10:49:03 AM] AIAL Annual Report 2001 Dividends paid 42,840 63,420 372,840 518,420 Net cash flow from financing activities (16,040) (32,720) Net increase/(decrease) in cash held 1,050 (157) Opening cash brought forward (1,186) (1,029) Ending cash carried forward 10 (136) (1,186)

The Notes and Accounting Policies form part of and are to be read in conjunction with these financial statements.

http://www.auckland-airport.co.nz/Annual2001/cashflows.html (2 of 2) [3/13/2002 10:49:03 AM] AIAL Annual Report 2001

for the year ended 30 June 2001

1. Establishment Auckland International Airport Limited is a company established under the Auckland Airport Act 1987 and was incorporated on 20 January 1988 under the Companies Act 1955. Most of the original assets of the Auckland International Airport were vested in the Company on 1 April 1988 by an Order in Council of the New Zealand Government. The Company commenced trading on 1 April 1988. The company was re-registered under the Companies Act 1993 on 6 June 1997.

2. Statement of Accounting Policies

These financial statements are presented as required by the Companies Act 1993 and have been prepared in accordance with the Financial Reporting Act 1993.

The financial statements are prepared on the basis of historical cost, except investment properties, land and buildings, runways, taxiways and aprons and infrastructural assets are stated at valuation.

Specific Accounting Policies

The following specific accounting policies which materially affect the measurement of financial performance and financial position have been applied. (i) Basis of Equity Accounting The equity method of accounting has been used for an associate company in which there is a significant, but not a controlling interest.

(ii) Fixed Assets

Fixed assets are initially stated at cost and depreciated as outlined below. The cost of fixed assets includes all costs directly attributable to bringing the item to working condition for its intended use.

It is the company's policy to re-state land and buildings, runways, taxiways and aprons and infrastructural assets at valuation determined no less than every three years by an independent registered valuer. Fixed assets other than investment properties were last valued in June 1999. The basis of valuation is Optimised Depreciated Replacement Cost (ODRC). Any increase in value of a class of revalued assets is recognised directly in equity unless it offsets a previous decrease in value which had been recognised in the statement of financial performance, in which case it is recognised in the statement of financial performance. Any decrease in value relating to a class of revalued assets is recognised in equity unless it exceeds any previous

http://www.auckland-airport.co.nz/Annual2001/notes.html (1 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001 revaluation in which case it is recognised in the statement of financial performance. When applied, revaluations are undertaken for all assets of a particular class. Where an asset is disposed of, the gain or loss recognised in the statement of financial performance is calculated as the difference between the net sale price and the carrying amount of the fixed asset. Depreciation is calculated on a straight-line basis to allocate the cost or revalued amount of an asset, less any residual value, over its estimated useful life. The estimated useful lives of fixed assets are as follows: Land Indefinite Buildings and services 5-33 years Infrastructural assets 5-50 years Runways, taxiways & aprons 16-40 years Vehicles 5 years Plant & office equipment 3-10 years

(iii) Investment Properties The Directors have identified that certain commercial properties owned by the company are held primarily for the purposes of obtaining the benefits of rental income. The Directors have determined that these properties should be treated as investment properties. The Directors have identified that certain commercial properties owned by the company are held primarily for the purposes of obtaining the benefits of rental income. The Directors have determined that these properties should be treated as investment properties. Investment properties are stated at valuation, as determined every year by an independent registered valuer. The basis of valuation is market value less the estimated cost of disposal, based on each property's highest and best use. Any increase on revaluation is recognised directly in equity unless it offsets a previous decrease in value recognised in the statement of financial performance, in which case it is recognised in the statement of financial performance. A decrease in the value is recognised in the statement of financial performance where it exceeds the increase previously recognised in equity.

Investment properties are not depreciated.

(iv) Bank and Marketable Securities

These are recorded at the lower of cost and net realisable value.

(v) Accounts Receivable

Receivables are stated at their estimated realisable value.

(vi) Taxation The income tax expense charged to the Statement of Financial Performance is calculated after allowing for non-assessable income and non-deductible costs. Deferred taxation is determined on a partial basis using the liability method.

http://www.auckland-airport.co.nz/Annual2001/notes.html (2 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001 Any deferred tax liability or asset attributable to timing differences or losses carried forward is recognised in the financial statements only where there is virtual certainty that the benefit of timing differences or losses will crystallise in the foreseeable future. (vii) Financial Instruments Financial instruments in the statement of financial position include bank, investments, receivables, trade payables and borrowings. The particular recognition methods adopted are disclosed in the individual policy statement associated with each item. The company uses interest rate swaps and forward rate agreements to manage interest rate risk. The net differential, paid or received, on interest rate swaps is recognised as a component of interest expense or interest revenue over the period of the agreement. Net settlements on forward rate agreements are amortised to the statement of financial performance over the life of the hedged item or the period hedged. (viii) Foreign Currency Transactions denominated in foreign currency are converted to New Zealand dollars at the exchange rates in effect at the date of the transaction. (viii) Statement of Cash Flows The following are the definitions of the terms used in the statement of cash flows: (a) Cash is considered to be cash on hand and current accounts in banks, net of bank overdrafts. (b) Operating activities include cash received from all income sources and cash payments made for the supply of goods and services that are not investing or financing activities. (c) Investing activities are those activities relating to acquisition and disposal of non-current assets. (d) Financing activities include activities that change the equity and debt capital structure. Dividends paid in relation to the capital structure are included in financing activities.

(x) Goods and Services Tax (GST) The statement of financial performance and statement of cash flows have been prepared so that all components are stated exclusive of GST. All items in the statement of financial position are stated net of GST, with the exception of receivables and payables which include GST.

(xi) Inventories

All inventories are valued at the lower of cost and net realisable value. Cost is calculated on weighted average cost basis.

Changes in Accounting Policies During 2001, the company changed its accounting policy with respect to recognition of dividends declared post balance date. Under the new policy, dividends declared after balance date are disclosed in the notes to the financial statements (refer note 25). Previously all dividends declared were recognised as liabilities in the statement of financial position. This change has been made to comply with FRS-5: Accounting for Events Occurring after Balance Date and has had the effect of decreasing the dividend provision and increasing equity by

http://www.auckland-airport.co.nz/Annual2001/notes.html (3 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001 $26,300,000. There have been no other changes in accounting policies.

Changes in Comparatives Where applicable certain comparatives have been restated to comply with the accounting presentation adopted for the current period.

3. Total Revenue 2001 2000

$000s $000s

Total revenue includes: Airfield income 50,834 46,430 Development charge 30,944 26,032 Terminal services 15,208 14,188 charge Retail income 56,616 50,622

4. Expenses 2001 2000

$000s $000s

Operating expenses include:

Auditor's fees 45 45 Auditor's other fees paid 68 31 Directors' fees 245 215 Directors' retirement benefit 130 - Donations 31 19 Doubtful debts written off 852 58 Doubtful debts - change in 105 - provision Repairs and maintenance 16,657 18,398 Net Interest comprises: Interest on borrowings 22,283 18,632 Less: Interest capitalised 1,838 - Less: Interest revenue 653 110

19,792 18,522

5. Taxation 2001 2000 (a) Taxation Expense $000s $000s

Surplus before taxation 88,585 75,739

Prima facie taxation at 33% 29,233 24,994 Add: Taxation effect of permanent 230 840 differences http://www.auckland-airport.co.nz/Annual2001/notes.html (4 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001 Less: Taxation effect of timing (219) (829) differences not recognised Add: Taxation adjustment relating 88 - to previous years

Taxation Expense 29,332 25,005

Total unrecognised deferred tax liability at balance date is $12,063,000 (2000: $11,844,000). Included in the deferred tax liability is the tax effect of the revaluation of assets, which could crystallise if the assets were sold at the revalued carrying amounts. This liability, and all other tax effects on timing differences have not been recognised as it is unlikely that they will crystallise in the foreseeable future. 2001 2000 (b) Imputation Credits $000s $000s

Balance at beginning of year 9,707 15,552 Income tax paid 27,700 22,750 Credits attached to dividends paid (19,344) (28,965) Credits attached to dividends 271 249 received Previous year's adjustments - 121

Balance at end of year 18,334 9,707

6. Associate Company 2001 2000

$000s $000s

Share of surplus of 611 479 associate company Taxation expense 204 160

Share of surplus after tax of associate 407 319 company Less share of dividends 550 - paid

Net addition/(reduction) (143) 319 in equity carrying value Share of associate's equity at beginning of 734 920 the year

591 1,239 Bonus share issued in - (505) lieu of dividend

Total share of incease/(decrease) in 591 734 associate's equity since acquisition Cost of investment in 1,505 1,000 associates

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Bonus share issued in - 505 lieu of dividend

Equity accounted value 2,096 2,239 of investments

Associate company comprises HMSC-AIAL Ltd (50%). HMSC-AIAL Ltd operates food and beverage facilities at the International Terminal of Auckland International Airport and has a balance date of 31 December 2001. During the year HMSC-AIAL paid dividends of $550,000 (2000: $505,000 of bonus shares were issued in lieu of dividend).

7. Dividends to shareholders 2001 2000

$000s $000s

Interim dividend of 5.0 cents per share paid 21,000 18,900 (2000: 4.5 cents) Special dividend in 2000 - 23,100 of 5.5 cents Final dividend in 2000 of - 21,840 5.2 cents per share

Total dividends of 5 cents per share (2000: 21,000 63,840 15.2 cents)

Dividends paid were based on 420 million shares on issue at the time of payment. On 30 August 2001, the Directors approved the payment of a final dividend of $26,300,000 (6.25 cents per share) to be paid on 19 October 2001.

8. Fixed Assets 2001 2000

$000s $000s

Freehold land At valuation 313,996 313,996 Reclassification at cost (2,377) (1,057)

311,619 312,939

Buildings and services At valuation 271,627 271,627 At cost 19,221 4,309 Accumulated 36,078 19,128 depreciation

254,770 256,808

Infrastructure

http://www.auckland-airport.co.nz/Annual2001/notes.html (6 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001 At valuation 105,624 105,624 At cost 12,928 7,661 Accumulated 8,911 4,295 depreciation

109,641 108,990

Runway, taxiways and

aprons At valuation 60,985 60,985 At cost 45,894 20,794 Accumulated 7,471 3,578 depreciation

99,408 78,201

Vehicles, plant and 41,926 38,838 equipment at cost Accumulated 31,837 27,821 depreciation

10,089 11,017

Total Fixed Assets 785,527 767,955

Asset Valuation: Land was independently valued by Seagar & Partners (Auckland) Limited, Registered Valuers, as at 30 June 1999 using an Optimised Depreciated Replacement Cost (ODRC) methodology. Buildings, infrastructural assets and runways, taxiways and aprons were independently valued by Beca Valuations Limited, Registered Valuers, as at 30 June 1999. The valuations placed on the assets were arrived at using the ODRC methodology for specialised assets on an existing use basis adjusted for the costs of disposal. Additions since 30 June 1999 have been recorded at cost. Additions for the year ending 30 June 2001 include capitalised interest of $1,838,000 (2000: NIL).

9. Investment Properties 2001 2000

$000s $000s

Investment properties 77,146 55,756 at valuation Investment properties under construction at 4,046 4,177 cost

81,192 59,933

The identified investment properties were valued as at 30 June 2001 by Seagar & Partners (Auckland) Ltd, Registered Valuers. The basis of valuation was market value less the estimated costs of disposal, based on each property's highest and best use. This valuation basis is consistent with the previous year.

http://www.auckland-airport.co.nz/Annual2001/notes.html (7 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001 The valuation resulted in an increased market value over book value of $112,000 (2000: $2,544,000) which has been recorded as an increase in the Investment Property Revaluation Reserve.

10. Bank Overdraft 2001 2000

$000s $000s

Cash and bank balances (136) (1,186)

11. Accounts Receivable 2001 2000

$000s $000s

Receivables 13,187 7,811 Less: Provision for (354) (249) doubtful debts

12,833 7,562

12. Share Capital 2001 2000 (a) Ordinary Shares $000s $000s

Issued & paid up capital 420,800,000 (2000: 420,000,000) ordinary 212,000 210,000 shares fully paid

(b) Options On 25 June 1998 the Board issued options to John Goulter entitling him to purchase two million shares at an exercise price of $2.50 per share. The options have a term of four years commencing 3 July 1998, provided that they may not be exercised prior to expiration of the first 30 months of that term and may be exercised at any time over the remaining 18 months while John Goulter continues to hold the office of managing director or holds another position of responsibility within the company. The options may also be exercised within three months of a purchaser acquiring 25% or more of the issued shares in the company.

In April 2001 options for 800,000 shares were exercised at $2.50.

Further options have been issued pursuant to the Executive Share Option Plan. Details of these options are disclosed in Note 23.

13. Borrowings At balance date the following borrowing facilities were in place: Effective 2001 2000 Interest $000s $000s Rates http://www.auckland-airport.co.nz/Annual2001/notes.html (8 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001

Bonds: Bonds maturing 15 7.5% 50,000 50,000 March 2002 Bonds maturing 15 7.5% 50,000 50,000 April 2004 Bonds maturing 15 8.0% 50,000 50,000 November 2006 Bonds maturing 15 7.5% 50,000 - November 2008

Total Bonds 200,000 150,000 Commercial paper 5.49% - maturing 120,000 140,000 7.03% July-December 2001

Term Borrowings 320,000 290,000 Current Borrowings 1,300 6,500

Total Borrowings 321,300 296,500

The company utilises medium term bonds and commercial paper programmes to provide its ongoing debt requirements. It routinely rolls over maturing bonds and commercial paper at maturity. It is for this reason that all borrowings under these facilities are treated as term borrowings. The company has a commercial paper facility for $150 million which has been in place since 1997. In addition a $50 million stand-by facility acts as a liquidity support for the commercial paper facility. This stand-by facility is underwritten by ASB Bank Limited. Borrowings under the bond programme, commercial paper and stand-by facilities are supported by a negative pledge deed.

14. Accounts Payable 2001 2000

$000s $000s

Employee entitlements 2,155 1,815 GST payable 767 1,224 Fixed asset retentions and 7,625 6,477 payables Other payables and provisions 11,190 11,281

21,737 20,797

15. Reconciliation of Surplus after Taxation with Cash Flow from Operating Activities 2001 2000

$000s $000s

Surplus after taxation before 59,253 50,734 including associate company Add non-cash item: Depreciation 30,730 29,488

http://www.auckland-airport.co.nz/Annual2001/notes.html (9 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001 Bad and doubtful debts 957 58 Add items not classified as

operating activities: Asset disposals (38) (13) (Increase)/Decrease in fixed assets (1,148) 2,302 retentions and payables Movement in working capital: (Increase)/decrease in current (5,234) (2,874) assets Increase/(decrease) in taxation (120) (6) payable Increase/(decrease) in accounts 940 (3,621) payable Increase/(decrease) in other term 13 1 liabilities

Net cash flow from operating 85,353 76,069 activities

16. Financial Instruments Interest Rate and Credit Management The company has a treasury risk management policy which limits exposure to interest rate and counter-party credit risk.

Interest rate risk: The company's policy is to manage its interest rate risk so that fixed rate borrowings are maintained between 40% and 80% of total borrowings. At year-end 47% (2000: 51%) of the borrowings were subject to fixed interest rates, which are defined as borrowings with an interest reset date greater than one year. The notional face value of outstanding derivative instruments at balance date are: 2001 2000

$000s $000s

Interest rate swaps 85,000 - Forward rate 50,000 - agreements

Foreign currency risk:

At balance date the company had no direct foreign currency exposure.

Credit risk: Cash deposits and marketable securities are restricted by the amount which can be placed with any one institution which will be either the NZ Government or a NZ registered bank with an appropriate international credit rating. The company minimises its credit risk by spreading such exposures across a range of institutions.

Accounts receivable principally comprise amounts due from airlines, tenants and licensee's. The company has a policy that manages exposure to credit risk by way of requiring collateral for some customers where credit rating or history indicates that this would be prudently required. There are no significant concentrations of credit risk.

http://www.auckland-airport.co.nz/Annual2001/notes.html (10 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001 Fair value: Bank, Investments, Receivables, Trade Payables and Commercial Paper:

The carrying value of these items is equivalent to their fair value and therefore excluded from the table below.

The estimated fair values of the remaining financial instruments are as follows: 2001 2001 2000 2000 Carrying Fair Carrying Fair

value value value value $000s $000s $000s $000s

Interest rate swaps - (360) - - Forward rate agreements - (23) - - Bonds 200 206 150 153

The fair value of the above financial instruments is based on the quoted market prices for these instruments at balance date.

17. Fixed Asset Revaluation Reserve 2001 2000

$000s $000s

Balance at beginning of 258,545 258,545 year Fixed assets net -- revaluations

Balance at end of year 258,545 258,545

18. Investment Property Revaluation Reserve 2001 2000

$000s $000s

Balance at beginning of year 25,321 22,777 Investment properties net 112 2,544 revaluations

Balance at end of year 25,433 25,321

19. Capital Commitments Capital commitments entered into but not accrued at balance date were $23,317,000 (2000: $51,036,000). These relate to the runway rehabilitation and other airport development projects. As at balance date there were no other commitments. In the prior year the company had potentially committed to a commercial property purchase subject to a put and call option of $6,232,000. This potential commitment was exercised subsequent to balance date as per note 25(b) and is included within capital commitments above. http://www.auckland-airport.co.nz/Annual2001/notes.html (11 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001

20. Contingent Liabilities (a) Noise Insulation: In May 1998 the Manukau City Council released a decision on the airport provisions in the Proposed Manukau District Plan which confirmed approval for a second northern runway, while imposing requirements on the company to make offers to insulate noise affected houses in the path of both the existing and proposed second runway. The Plan has been appealed by the company. The expectation is that the appeal will lead to changes in insulation obligations on the company. Some three years ago the company entered into a mediation process with the Council and other appellants with a view to avoiding the need to have the issues resolved via a full Environment Court hearing.

The issues are close to resolution and it appears that an Environment Court hearing will not be necessary. Given that the issues have not been fully resolved it would be inappropriate for the directors to attempt to quantify the amount or timing of any costs relating to this obligation as the matter may not be resolved as presently anticipated, hence no provision has been made in the financial statements. The company believes that in respect of any insulation costs that may be placed on the company a significant portion will, in turn, be recovered through additional or new user charges. (b) Landing Charges: In August 2000 the company announced after an eleven month consultation process with its airline customers, that it would increase the Airfield Landing Charges by 8.5%, effective 1 September 2000 and, in each of the two subsequent years on 1 September, a further 5% increase. Air New Zealand has not paid the increased charges and is challenging the adequacy of the company's consultation process through litigation. All other airlines are paying the increased charges. The company is extremely confident that the consultation process was conducted in accordance with all legal and commercial requirements and the Air New Zealand action will be defended vigorously. The financial results for the period include charges at the increased levels and accruals for the amounts unpaid by Air New Zealand which totalled to $1.5 million (excluding GST) at balance date. The directors are unable to accurately assess the likely cost of the proceedings and no provision has been made for such costs.

There were no other contingent liabilities outstanding at 30 June 2001 (2000 Nil).

21. Related Party Transactions All trading with the associated company, including licence fees and other sundry charges, has been on a commercial basis without special privileges. During the year ended 30 June 2001 these transactions with HMSC-AIAL Ltd totalled $473,000(2000: $308,000). As at 30 June 2001 $8,000 was owed by HMSC-AIAL Ltd (2000: $3,000 was owed to HMSC-AIAL).

22. Employee Share Purchase Plan

http://www.auckland-airport.co.nz/Annual2001/notes.html (12 of 15) [3/13/2002 10:49:11 AM] AIAL Annual Report 2001 The company established the Auckland International Airport Limited Share Purchase Plan (the Plan) following a resolution of shareholders at the Annual General Meeting of the company on 16 November 1999 to assist employees to become equity holders in the company. A Trust Deed dated 19 November 1999 governs the operation of the plan. The Plan was open to all full time and part time (those working more than 15 hours per week) employees who have a minimum of one year's service. Consideration payable for the shares was determined by the company. The company advanced to the Trust all the monies necessary to purchase the shares under the Plan. The advances are repayable by way of deduction from the employees' regular remuneration. The terms of such loans are determined by the company. Amount of debt forgiven by the company during the year was nil (2000: $241,748 being a sum to reimburse the trust for losses made on the shares issued to staff and an amount sufficient to establish the Plan as an independent entity). The amount payable to the company by the Plan at balance date is $137,680 (2000: $243,230). These advances are interest free. The shares allocated under the Plan are held in trust for the employees by the trustees of the Plan during the restrictive period. The voting rights are exercised by the Trustees of the Plan during the restrictive period. The restrictive period is the longer of three years or the period of repayment of the loan made by the company in relation to the acquisition of shares. The Plan's trustees, being Mr W R Boyd, Mr J P Goulter and Mr C J Curley, are appointed and can be removed by the company. The Plan allocated and held the following ordinary shares: 2001 2000

Allocation -

November 1999 Shares allocated to 142,000 142,000 employees Shares forfeited during (9,000) - the year

133,000 142,000

Shares were issued at a price of $2.18 being a 20% discount to the market rate on the date of the issue. Allocation -

November 2000 Shares allocated to 29,200 - employees Shares forfeited during (1,000) - the year

28,200 142,000

Shares were issued at a price of $2.34 being a 20% discount to the market rate on the date of the issue. 2001 2000 Unallocated shares 23,800 43,000 held by the plan

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185,000 185,000

The shares were acquired by the trustees at an average price of $2.93 each on 28 September 1999. Shares held by the Plan represent approximately 0.044% (2000: 0.044%) of the total shares of the company on issue.

23. Executive Share Option Plan As part of executive remuneration, the company has established the Executive Share Option Plan to assist in attracting and retaining key executives and ensuring that the interests of those executives and the company are aligned. The company has issued options for shares in the company to certain employees under the terms of the Plan during the year. The holder of an option is entitled to subscribe for one fully paid share for each option. The exercise price is determined based on the company's share price at the date of issue of the option adjusted to reflect movements in the NZSE 40 gross index between the date of issue and the date of exercise of the option, less any dividends which the company has paid during this period. The first issue of options under this Plan was made on 15 December 1999. No options are exercisable until after the third anniversary of issue of the option and if options are not exercised before the sixth anniversary of issue then they are deemed to have lapsed. Options also lapse when an employee terminates their employment with the company. Options are issued to executive employees of the company at the discretion of a committee of the Board of Directors of the company. This committee also has discretion over the number of options issued to any employee and the specific terms of any options issued. Details of options issued under the scheme at 30 June 2001 are as follows: 2001 2000

Number of options issued on 15 December 1,045,000 1,045,000 1999 Number of options issued on 8 September 1,195,000 - 2000 Number of options outstanding at 30 June 2,240,000 1,045,000 2001

24. Segmental Reporting In accordance with the accounting standard SSAP 23, Auckland International Airport Limited operates in one geographic segment in Auckland, New Zealand. The company operates in the airport industry and earns revenue from aeronautical activities and other charges and rents associated with operating an airport.

http://www.auckland-airport.co.nz/Annual2001/notes.html (14 of 15) [3/13/2002 10:49:12 AM] AIAL Annual Report 2001 25. Subsequent Events (a) On 2nd July 2001 Auckland International Airport Limited sold the incinerator operation and the net proceeds were $1.9m. A joint venture has been formed between Auckland International Airport Limited and the French owned company, Tredi (NZ) Limited, to operate and further develop the existing quarantine incinerator operation based at Auckland Airport trading under the name Waste Resources Limited. (b) On 13 July 2001 Auckland International Airport Limited purchased the improvements constructed on the Exel (formerly referred to as Total Logistics) site for $5,587,687. The property is subject to a lease. (c) The Commerce Commission has commenced an inquiry to determine whether it is necessary and desirable to impose price controls on the airfield activities of Auckland, Wellington and Christchurch airports. The Commerce Commission has produced a draft report on which submissions and cross-submissions have been lodged. A conference on the key issues is scheduled for September with a final report and recommendation due in November 2001. (d) On 30 August 2001, the Directors approved the payment of a final dividend of $26,300,000 (6.25 cents per share) to be paid on 19 October 2001.

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AUDIT REPORT TO THE SHAREHOLDERS OF AUCKLAND INTERNATIONAL AIRPORT LIMITED We have audited the financial report on pages 33 to 45. The financial report provides information about the past financial performance of Auckland International Airport Limited and its financial position as at 30 June 2001. This information is stated in accordance with the accounting policies set out on pages 36 and 37. Board of Directors' Responsibilities The Board of Directors is responsible for the preparation, in accordance with New Zealand law and generally accepted accounting practice, of a financial report which gives a true and fair view of the financial position of Auckland International Airport Limited as at 30 June 2001 and of the results of its operations and cash flows for the year ended 30 June 2001. Auditors' Responsibilities It is our responsibility to express an independent opinion on the financial report presented by the Board of Directors and report our opinion to you. Basis of Opinion An audit includes examining, on a test basis, evidence relevant to the amounts and disclosures in the financial report. It also includes assessing: ● the significant estimates and judgements made by the Board of Directors in the preparation of the financial report, and ● whether the accounting policies are appropriate to the company's circumstances, consistently applied and adequately disclosed.

We conducted our audit in accordance with New Zealand Auditing Standards. We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to obtain reasonable assurance that the financial report is free from material misstatements, whether caused by fraud or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial report.

Other than in our capacity as auditor and the provision of taxation and consulting advice, we have no relationship with or interests in Auckland International Airport Limited. Unqualified Opinion We have obtained all the information and explanations we have required. In our opinion: ● proper accounting records have been kept by Auckland International Airport Limited as far as appears from our examination of those records; and

http://www.auckland-airport.co.nz/Annual2001/audit.html (1 of 2) [3/13/2002 10:49:19 AM] AIAL Annual Report 2001 ● the financial report on pages 33 to 45: - complies with generally accepted accounting practice in New Zealand; - gives a true and fair view of the financial position of the company as at 30 June 2001 and the results of its operations and cash flows for the year ended on that date.

Our audit was completed on 30 August 2001 and our unqualified opinion is expressed as at that date.

AUCKLAND, NEW ZEALAND CHARTERED ACCOUNTANTS

Airport Web Site Home Page

http://www.auckland-airport.co.nz/Annual2001/audit.html (2 of 2) [3/13/2002 10:49:19 AM] AIAL Annual Report 2001

The Board of Directors is responsible for the corporate governance of the company. The term "corporate governance" is generally understood to mean the control of the business by the directors, and the accountability of directors to shareholders and others, for the performance of the company and compliance by the company with laws and standards. This statement sets out the corporate governance policies, practices and processes adopted or followed by the Board throughout the year.

The Board The Board currently comprises five non-executive directors (including the chairman) and one executive director (the managing director). Details of the directors are set out on page 49.

With the exception of January and July, Board meetings are generally held monthly. The Board met 12 times during the 2001 financial year, which included four meetings to specifically address pricing issues.

The Board is responsible for the direction and supervision of the business and affairs of the company, and also the monitoring of the performance of the company on behalf of shareholders. The Board also places emphasis on regulatory compliance, including the environment and health and safety.

Responsibility for the day-to-day management of the company has been delegated to the managing director.

Delegations of financial operating authorities to the managing director and other management executives are in place, along with operational and administrative policies relative to the company's business. The company has in place an internal audit system for monitoring the company's operational policies and practices.

The Board is elected by the shareholders of the company. At each annual meeting, at least one-third of the directors (excluding the managing director) retire by rotation. The directors to retire are those who wish to retire, those whose term of appointment has expired, or those who have been the longest in office since last being elected.

The Board has two formally constituted committees - the Audit Committee and the Remuneration Committee. Ad hoc committees are established on the basis of need.

Audit Committee The Audit Committee comprises two non-executive directors - Anthony Frankham, Chairman, and Michael Smith, with the Chairman of the Board, Wayne Boyd, as an ex-officio member.

http://www.auckland-airport.co.nz/Annual2001/governance.html (1 of 2) [3/13/2002 10:49:26 AM] AIAL Annual Report 2001 The committee assists the Board in fulfilling its responsibilities for company financial statements and external financial reporting. The committee is responsible for reviewing the adequacy and effectiveness of the company's internal controls, reviewing the performance and findings of the external auditors, and reviewing and making recommendations on the company's accounting policies, financial statements, and announcements to the New Zealand Stock Exchange concerning results. During the 2001 financial year, the Audit Committee met twice.

Remuneration Committee The Remuneration Committee comprises two non-executive directors - Sir Wilson Whineray (Chairman) and Joan Withers, with Wayne Boyd an ex-officio member. The committee reviews and recommends to the Board, on the basis of independent advice, the remuneration arrangements, including the issue of options, for the managing director and the management executive, who report directly to the managing director. The committee generally meets twice a year.

Share Trading Directors and executive staff at the company are not permitted to engage in short-term trading of company shares at any time. Directors, management and corporate staff may only buy or sell shares in the company during two "windows" immediately following the announcement of yearly and half-yearly results.

Health & Safety The company operates teams to monitor and review occupational health and safety aspects of the operations. Reports are submitted to each Board meeting in respect of all health, safety, security and environmental matters.

Airport Web Site Home Page

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Reporting Entity The company was incorporated on 20 January 1988, under the Companies Act 1955, and commenced trading on 1 April 1988. The company was re-registered under the Companies Act 1993 on 6 June 1997. On 25 June 1998, the company adopted a revised Constitution, approved as appropriate for a publicly listed company. A further revision of the Constitution was adopted on 21 November 2000 in order to comply with revised New Zealand Stock Exchange Listing Rule requirements.

The company was registered in Australia as a foreign company under the Corporations Law on 22 January 1999 (ARBN 085 819 156).

Stock Exchange Listings The company's shares were listed on the New Zealand Stock Exchange on 28 July 1998. The company's shares were listed on the Australian Stock Exchange on 22 February 1999. The Australian Stock Exchange has granted the company exempt foreign company status, under which compliance with most of its Listing Rules is not required, as long as the company continues to be listed on the New Zealand Stock Exchange. Waivers Granted by the New Zealand Stock Exchange The company obtained a waiver from the New Zealand Stock Exchange in respect of the need to obtain shareholder approval for the issue of 2,000,000 options to the managing director, John Goulter. These new options replaced, and were on identical terms to, the 2,000,000 options previously granted to Mr Goulter in 1998. The process for issuing the original options (which original options were cancelled on the issue of the new options) was technically incorrect. The previous options were granted before the company was listed and have been fully disclosed in the Prospectus issued at the time of listing and in subsequent Annual Reports.

Disciplinary Action Taken by the New Zealand Stock Exchange The New Zealand Stock Exchange has not taken any disciplinary action against the company in the period under review.

Regulatory Environment The company is regulated by, amongst other things, the Airport Authorities Act 1966 and the Civil Aviation Act 1990. The company is an "airport company" for the purposes of the Airport Authorities Act 1966. The company has consultation and disclosure obligations under the Airport Authorities Act 1966.

The company is obliged to comply with the Airport Authorities (Information Disclosure) Regulations, with Disclosure Financial Statements required to be published in November each year.

Auditors The appointment of Deloitte Touche Tohmatsu as auditors of the

http://www.auckland-airport.co.nz/Annual2001/shareholders.html (1 of 3) [3/13/2002 10:49:30 AM] AIAL Annual Report 2001 company was confirmed at the 2000 annual meeting of shareholders. Deloitte Touche Tohmatsu have continued to act and have undertaken the audit of the financial statements for the 30 June 2001 year.

Indemnity and Insurance In accordance with section 162 of the Companies Act 1993 and the Constitution of the company, the company has continued to indemnify and insure its directors and officers against liability to other parties (except to the company or a related party to the company) that may arise from their position as directors. The insurance does not cover liabilities arising from criminal actions.

Entries Recorded in the Interests Register Entries in the Interests Register made during the year, and disclosed pursuant to sections 211(1)(e) and 140(1) of the Companies Act 1993 are as follows: (a) Directors' Interests in Transactions Specific disclosures under section 140(1) of the Companies Act 1993 for the year in review are: (i) Sir Wilson Whineray is a director of The National Bank of New Zealand Limited, which is one of a number of banks that are party to the company's commercial paper programme. (ii) John Goulter is a director of the joint-venture company, HMSC-AIAL Limited, which has "arm's length" dealings with the company in respect of food and beverage concessions. (iii) Joan Withers is a director of The Warehouse Group Limited which has "arm's length" dealings with the company in respect of a property lease. (iv) John Goulter declared his interest in the issue to him of the replacement options. (b) Share Dealings by Directors Pursuant to section 148 of the Companies Act 1993, directors disclosed the following transactions of company shares: There were no dealings by directors during the year. (c) Loans to Directors There are no loans to directors. (d) Use of Company Information There were no entries in the Interests Register as to the use of company information under section 145(3) of the Companies Act 1993.

Donations In accordance with section 211(1)(h) of the Companies Act 1993, the company records that it donated a total of $31,000 to various charities during the year.

Earnings per Share Earnings in cents per ordinary shares were 14.05 cents in 2001 compared with 12.16 cents in 2000 and 10.10 cents in 1999.

Credit Rating As at 30 August 2001, the Standard & Poor's long-term debt rating for the company was A+ and the short-term debt rating was A-1.

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Directors held interests in the following shares in the company as at 30 June 2001: Wayne Boyd Beneficially owned 13,889 Non-beneficial interest 5,556 Held by associated persons 11,112 Anthony Frankham Beneficially owned 50,000 Held by associated persons 19,444 John Goulter Beneficially owned 25,000 Michael Smith Beneficially owned 50,000 Sir Wilson Whineray Beneficially owned 19,445 Joan Withers Beneficially owned 8,333

As disclosed in the Notes to Accounts (Note 13), John Goulter also holds 1,200,000 options on ordinary shares under an Option Agreement between himself and the company. Mr Goulter has also been granted a total of 450,000 options on ordinary shares issued in accordance with the Executive Share Option Plan (Note 24).

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The following general disclosures of interests were made by the directors in terms of section 140(2) of the Companies Act 1993:

Wayne Boyd Chairman, Shotover Jet Limited Director, Forsythe Barr Group Limited Director, Ngai Tahu Holdings Corporation Limited Member, Recreation & Sport Agency

Anthony Frankham Director, Frankham Lyne Limited Director, ProCare Health Limited Trustee, Spirit of Adventure Trust

John Goulter Director, HMSC-AIAL Limited Director, The Reserve Bank of New Zealand Trustee, Auckland International Airport Life Education Trust

Michael Smith Chairman, RD1.COM Limited Director, Fonterra Co-operative Group Limited Director, New Zealand Co-operative Dairy Company Limited Director, Taylors Group Limited Director, Tru-Test Limited Director, UnitedNetworks Limited Director, Wrightsons Limited

Sir Wilson Whineray Chairman, Carter Holt Harvey Limited Chairman, The National Bank of New Zealand Limited Director, Comalco New Zealand Limited Director, Nestlé New Zealand Limited Director, Wilson & Horton Limited

Joan Withers Chairman, Clinical Research & Effective Practice Foundation Director, Auckland Trotting Club Inc Director, Meridian Energy Limited Director, The Warehouse Group Limited Director, Tourism Holdings Limited

Directors' Remuneration and Other Benefits Wayne Boyd Fees $80,000 Anthony Frankham Fees $45,000 John Goulter Fees - Remuneration1,2 $547,865 Michael Smith Fees $40,000 Sir Wilson Whineray Fees $40,000

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1. Principally salary and performance bonus - John Goulter does not receive directors’ fees. 2. Options held by John Goulter to acquire ordinary shares in the company, referred to elsewhere in this report, do not form part of his remuneration package, and are not included.

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Grouped below, in accordance with section 211(1)(g) of the Companies Act 1993, are the number of employees or former employees of the company, excluding directors of the company, who received remuneration and other benefits in their capacity as employees, totalling $100,000 or more, during the year:

Remuneration Number of Employees $100,000 to $110,000 3 $110,001 to $120,000 5 $120,001 to $130,000 2 $140,001 to $150,000 1 $230,001 to $240,000 1 $250,001 to $260,000 1 $270,001 to $280,000 2 $280,001 to $290,000 1

Remuneration includes salary, performance bonuses, employer's contributions to superannuation, health and insurance plans, motor vehicle and other sundry benefits received in their capacity as employees.

Airport Web Site Home Page

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as at 20 August 2001

Size of Holding Number of % Number of % Shareholders Shares 1-499 1,117 2.04 286,020 0.08 500-999 36,14465.98 20,273,715 4.82 1,000-1,999 5,66910.35 7,247,686 1.72 2,000-4,999 6,78912.39 19,906,696 4.73 5,000-9,999 3,090 5.64 19,230,540 4.57 10,000-49,999 1,829 3.34 29,013,825 6.89 50,000-99,999 79 0.14 4,757,758 1.13 100,000-499,999 45 0.08 7,900,588 1.88 500,000-999,999 5 0.01 3,330,706 0.79 1,000,000 and over 14 0.03 308,852,46673.40 Total 54,781 420,800,000

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as at 20 August 2001

Pursuant to section 26 of the Securities Amendment Act 1988, the following persons had given notice as at 10 September 2001 that they were substantial security holders in the company and held a 'relevant interest' in the number of ordinary shares shown below. Substantial Security Number of Shares inDate of Notice Holder 'Which Relevant Interest' is held Auckland City Council 108,171,000 14.09.98 Manukau City Council 40,525,228 14.09.98 Singapore Changi 30,009,000 26.11.99 Airport Enterprise Pte Limited Colonial First State 47,837,462 10.09.01 Investment Managers Limited

The total number of voting securities on issue as at 10 September 2001 was 420,800,000

Twenty Largest Shareholders Shareholder Number of Percentage of Shares Capital Auckland City Council 108,171,000 25.70 New Zealand Central 91,102,928 21.64 Securities Depository Limited Manukau City Council 40,525,228 9.63 Citicorp Nominees Pty 31,483,127 7.45 Limited ABN AMRO Nominees NZ 30,359,000 7.21 Limited Westpac Custodian 2,117,213 0.50 Nominees Limited NZ Guardian Trust Company 1,618,936 0.38 Limited Colonial Investment 1,474,024 0.35 Services Limited Commonwealth Custodial 1,097,416 0.26 Services Limited National Nominees Limited 1,060,998 0.25 Motor Accident Commission 843,450 0.20 Guardian Assurance Limited 774,800 0.18 Rotorua Energy Charitable 725,000 0.17 Trust

http://www.auckland-airport.co.nz/Annual2001/substantial.html (1 of 2) [3/13/2002 10:50:11 AM] AIAL Annual Report 2001 Peter Hanbury Masfen & 600,000 0.14 Joanna Alison Masfen Perpetual Nominees Limited 509,356 0.12 Credit Suisse First Boston 428,075 0.10 NZ Custodians Limited Australasian Medical 366,500 0.08 Insurance Limited Forbar Custodians Limited 360,753 0.08 Salvation Army Property 300,000 0.07 New Zealand Trust Board Investment Custodial 291,751 0.06 Services Limited

New Zealand Central Securities Depository Limited (NZCSD) is a depository system which allows electronic trading of securities to members. As at 20 August 2001, the 10 largest shareholdings in the company held through NZCSD were: National Nominees Limited – Auckland Branch 19,613,592 Citibank Nominees (New Zealand) Limited 10,394,363 Westpac Banking Corporation 8,782,592 AMP Life Limited 4,573,578 The Trustees Executors and Agency Company of NZ 4,502,872 Limited AMP Superannuation Tracker Fund 3,787,456 Premier Nominees Limited-Armstrong Jones New Zealand 3,287,416 Share Fund ANZ Nominees Limited 2,722,766 The National Mutual Life Assurance of Australasia Limited 2,452,755 Guardian Trust Investment Nominees (RWT) Limited 2,119,785

Airport Web Site Home Page

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Company Publications The company informs investors of the company's business and operations by issuing an Annual Report (with Notice of Meeting) and an Interim Report. Financial Calendar Half YearYear Results announced March September Reports published March October Dividends paid March October Disclosure Financial Statements - November Annual meeting - November

Voting Rights The voting rights of shareholders are set out in the company's Constitution. Each holder of ordinary shares is entitled to vote at any annual meeting of shareholders. On a show of hands, each holder of ordinary shares is entitled to one vote. On a poll, one vote is counted for every ordinary share. A person is not entitled to vote when disqualified by virtue of the restrictions contained in the company's Constitution and the Listing Rules of the New Zealand Stock Exchange.

Enquiries Shareholders with enquiries about transactions, changes of address or dividend payments should contact Computershare Registry Services Limited on +64 9 488 8700. Other questions should be directed to the company's corporate secretary at the registered office.

Stock Exchange The company's ordinary shares trade on the New Zealand Stock Exchange and the Australian Stock Exchange. The minimum marketable parcel on the New Zealand Stock Exchange is 100 shares.

Dividends Shareholders may elect to have their dividends direct credited to their bank account.

Share Registrars Computershare Registry Services Limited Level 2, 159 Hurstmere Road, Takapuna, North Shore City, Auckland 1309, Private Bag 92-119, Auckland Mail Centre, Auckland 1020, New Zealand Telephone: +64 9 488 8700 Facsimile: +64 9 488 8787 Computershare Registry Services Pty Limited Level 3, 60 Carrington Street, Sydney, NSW 2000 GPO Box 7045, Sydney, NSW 1115, Australia Telephone: +61 2 8234 5000 Facsimile: +61 2 8234 5050

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Airport Web Site Home Page

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Directors Wayne Boyd, Chairman; John Goulter, Managing Director; Anthony Frankham; Michael Smith; Sir Wilson Whineray; Joan Withers

Management Executive John Goulter, Managing Director; Murray Barclay, General Manager - Commercial; Chris Curley, General Manager - Corporate & Corporate Secretary; David Hansen, General Manager - Operations; Paul Mens, General Manager - Finance & Information Technology; Stephen Reindler, General Manager - Engineering

Registered Office Jean Batten International Terminal, Auckland International Airport, New Zealand Telephone: +64 9 275 0789, 0800 Airport (0800 247 7678) Facsimile: +64 9 275 4927 Email: [email protected] Website: www.auckland-airport.co.nz

Mailing Address Auckland International Airport Limited, PO Box 73-020, Auckland International Airport, Auckland, New Zealand

Solicitors Russell McVeagh

Auditors Deloitte Touche Tohmatsu

Principal Bankers Bank of New Zealand

The Annual Meeting will be held 10.30am Wednesday, 21 November 2001 Newmarket Room Ellerslie Convention Centre Ellerslie Racecourse Greenlane Road Auckland

This Annual Report is dated 30 August 2001 and is signed on behalf of the Board by: Wayne Boyd, Chairman of the Michael Smith, Director Board

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Staff who have over 10 years service at the year ended 30 June 2001:

David Adamson Operations Business Manager 6/3/89 Dave Alderson Mechanical/Electrical Draughtsman 22/4/91 Geoff Alley Maintenance Project Overseer 3/9/90 Michael Andersen Human Resources Manager - Training 3/10/77 Geoff Armiger Customer Services Officer 27/5/91 Frank Armstrong Response Officer 10/3/80 Chris Baird Response Officer 1/4/85 Murray Barclay General Manager - Commercial 12/11/90 Lindsay Beadle Customer Services Officer 13/2/78 Mike Bedson Building Overseer 20/3/79 Denny Brindle Carpenter Leading Hand 8/2/88 Christine Brown Secretary to Managing Director 9/2/87 Dave Brown Response Officer 23/6/80 Cliff Burkett Leading Hand Maintenance Engineer 1/8/88 Kevin Carr Engineering Manager - Civil 5/9/88 Eddie Christie CSD - Operations Officer 27/12/84 Ted Clark Airfield Officer Apron Tower 11/7/88 Pete Daniels Painter 3/3/86 Ray Dumpleton Response Officer 15/5/78 Dave Eaton Response Officer 18/6/90 Dave Ewen Response Officer 9/4/90 Pierre Farrell Network Co-ordinator 19/5/86 Allan Flaxman CSD - Shift Controller 2/12/89 John Flint Customer Services Officer 27/5/85 Jim Follows Response Officer 26/3/86 Mark George Response Officer 15/8/77 Steve Gibson Response Controller 24/3/86 Mike Gibson Response Unit Manager 25/8/86 Lisa Goodman Response Officer 1/9/89 John Goulter Managing Director and Chief Executive 1/7/88 Royce Hansen Response Officer 23/6/80 David Hansen General Manager - Operations 1/3/90 David Harris Gardener Leading Hand 22/2/82 Dick Harris WRL Operator / Technician 25/6/86 Mike Hart Airfield Controller 19/2/74 George Harter Airfield Controller 1/11/76 Wayne Hedgman Response Officer 17/10/77 Max Hepburn CSD - Shift Controller 3/4/78 Trevor Herriott Response Controller 3/8/83 Dave Hughes Response Officer 19/9/77 Ian Hulse Response Supervisor 4/6/81 Robbie Jenkins Customer Services Officer 9/8/90 Cliff Jones Airfield Officer Apron Tower 10/4/89 Henare Karauna Painter 3/8/89 Grant Knock Response Supervisor 28/6/78 Graeme Langford Response Supervisor 22/6/87 Jane Lawson CSD - Deput ShiftController 24/7/90 Misi Lealaiauloto Airfield Officer Apron Tower 9/4/85 Gerry Leathem Airfield Officer Apron Tower 25/3/85 Laurie Lessiter Airfield Controller 19/5/80 Barbara Lucas Purchasing and Payroll Manager 5/12/88 David Marsden Ground Services Controller 12/8/85 Philip Matagi Labourer 26/6/86 Keith McGowan Customer Services Manager 22/3/76 Frances McHugh Revenue Officer 28/8/78 Brian McKay Electrical Working Foreman 7/3/90 Jim McPherson Airfield Controller 8/4/69 Coralie McQuoid CSD - Operations Officer 7/3/90 Cedric Miers Response Controller 10/5/71 Mark Milner Airport Safety Officer 2/10/71 Graham Mitcham CSD - Deputy Shift Controller 17/4/89 Eileen Osborne Purchasing Controller 9/11/89 Bob Parkinson Corporate Projects Manager 15/11/76 Margaret Peacocke Public Relations Manager 7/10/86 Noel Perry Response Officer 23/6/80 Roy Petrie Response Officer 6/4/70 Roger Potini Electrical Officer 8/8/88 Norm Rangi CSD - Shift Controller 23/2/81 Roy Robertson

http://www.auckland-airport.co.nz/Annual2001/celebrating_service.html (1 of 2) [3/13/2002 10:50:29 AM] AIAL Annual Report 2001 Draughting Services Manager 11/11/85 Gayle Ryan Secretary to GM Commercial 4/6/85 Mii Sadaraka Facilities Maintenance Orderly 3/8/87 Maurice Scholes CSD - Deputy Shift Controller 9/11/87 Shane Seth Building Officer 2/10/89 Lyn Shaw Manager Volunteer Services 19/11/90 Colin Shoebridge Response Officer 20/10/80 John Smith Response Officer 23/6/80 David Smyth Response Officer 13/11/89 Kim Sobotka Response Officer 22/6/87 Robert Spratt Customer Services Officer 12/5/86 David Spreadbury Response Officer 24/3/86 Ivor Stevens Airfield Officer Apron Tower 8/11/76 Tua Tauiti Labourer 30/1/90 Warren Taylor Response Officer 11/3/68 Josie Taylor CSD - Operations Officer 11/6/90 Kees van Boheemen Asset Controller 27/6/83 Tom Watford Facilities Maintenance Manager 4/5/87 Phil Williamson Engineering Officer - Services 25/2/85 Tony Wilson Response Controller 13/5/86 Margaret Wilson Smith Airfield Officer Apron Tower 19/1/87 Doreen Yee Human Resources Manager - Personnel 30/7/85

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