Long Term View: Auckland International Airport Ltd

In this new series of posts I am going to be looking at stocks listed on the NZX in relation to their returns to shareholders over the life of their listing -what shareholders would now see in their back pockets if they had invested in the company IPO.

The calculation of returns includes dividends and tax credits.

Starting at the beginning of the alphabet I am going to work my way down and see which NZX company comes off looking the best. I already have my own ideas in the back of my head as to which is the best long-term return on the NZX but will keep it to myself until I reach them.

Auckland International Airport [AIA.NZ] has treated shareholders well in terms of returns since its NZX listing in 1999. With 72 cents in net dividends (see chart above) paid and another 33% of that figure gained for those eligible for associated tax credits, an approx 400% return (see chart below for the share price percentage gain against the average of all NZX indexes) over the 11 year listing gives an approx annual net return of 36%.

This is nearly 4 times better than the return from the average of all NZX indexes.



Disc I own AIA shares


Long Term View Series

Auckland International Airport
Air New Zealand
AMP Ltd
Briscoe Group Ltd
Contact Energy Ltd
Delegats Group Ltd
EBOS Group Ltd
Fletcher Building Ltd
Fisher & Paykel Appliances
Fisher & Paykel Healthcare
Freightways Ltd
Goodman Fielder Ltd
Hellaby Holdings Ltd
Mainfreight Ltd
Metlifecare Ltd
New Zealand Refining Ltd
Port Of Tauranga Ltd
Pumpkin Patch Ltd
Restaurant Brands Ltd
Ryman Healthcare Ltd
Sanford Ltd
Sky City Entertainment Group Ltd
Sky Network Television Ltd
Telecom NZ Ltd
Telstra Corp Ltd
The Warehouse Group Ltd

Auckland International Airport @ Share Investor

VIDEO - Simon Moutter on Australian Airport Purchase
Auckland Airport Capital Raising a fair call
Auckland International Airport lands Australian Ports
What Infratil sale of Auckland Airport stake means...
Is another Auckland Airport bid likely under a business friendly Government?
Latest Airport coverage
Cullen's move on Auckland Airport has far reaching effects
Cullen's move on AIA tax plan Anti-Business
AIA profit stays grounded
Softening opposition to CPPIB bid for AIA
Directors of AIA bribe brokers not to sell
What is Auckland Airport worth to you?
Second bite at AIA by CPPIB might just fly
AIA new directors must focus on shareholders
Auckland Airport merger deal nosedives
The Canadians have landed
AIA incentive scheme must fly out the window
Government market manipulation over AIA/DAE deal
DAE move on AIA: Will it fly?

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c Share Investor 2010

NZX sneaks out embarassing carbon disclosure after dark

In an announcement sneaked out after market close on Friday 12 February (the day traditionally used by companies to hopefully hide embarrassing and bad news) The New Zealand Stock Exchange Ltd [NZX.NZ] has indicated that it has had to write down the value of a "performance payment" from the sale of its carbon registry, TZ1 last year.

Curiously the NZX valued this payment at $ US 37.1 million (seems quite arbitrary considering there is no set "value" for a "carbon credit") but have now decided to write this down to another arbitrary figure of US$21.4 million.

So, the NZX have been winners and losers in the carbon credit lark. They sold to some poor sucker at the height of the scam and lost out by missing on a performance bonus.

An interesting finish to the NZX release today:

In spite of tough operating conditions, the TZ1 registry business continues to lead the field in customer acquisition worldwide. As such it is very well-placed to benefit when the carbon agenda, and corporate willingness to commit voluntary spend in this field, return. The past 12 months was a planned, intensive growth phase for the carbon registry business, and that growth has been slowed by macro headwinds. NZX remains confident around the long-term success of the this business.

They admit that the carbon trading business is an "agenda", it is indeed one of those, a political one used by people like the folk at NZX to make money from thin air but they say they are also confident that the business will be a long-term winner.

I would have to argue again that this statement seems a little confusing because they sold TZ1 in the first place and it also looks to be collapsing into itself in a heap of smelly shareholder losing red ink on the NZX balance sheet.

I have to say, in terms of disclosure by the NZX and Mark Weldon, to be this sneaky about releasing this information, it sets a very poor example for the listed companies that it manages on behalf of shareholders and goes to show when you mess with an "investment" that is based on fraud and when you don't understand that investment, you can quickly come unraveled.

NZX shareholders are the big losers here and there will be more losses to come as carbon trading continues to unravel.

Related Share Investor Reading

Rod Oram: On the Prius to Obscurity
Another reason to ignore Rod Oram
Rob Fyfe's "Environmental Extremism"
Carbon Credit Trading puts markets at extreme risk
Mark Weldon Strikes out on Carbon Trading
Quote of the year
Of Tulip bulbs and Tooth fairies
Global warning: Tax iceberg ahead
Mark Weldon in two minds about carbon trading

Related links

Kristen Byrne: Ponder the Maunder - a 15 year old schoolgirl debunks climate change myth


Recommended Fishpond Reading



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c Share Investor 2010

Stock of the Week - Reprise 2 : Contact Energy Ltd

Contact Energy Ltd [CEN.NZ] was a Stock of the Week pick back in November and I picked it then because the share price was heading below 6 bucks, similarly in June 2009, and there seems to be some resistance to the stock price falling too far past the $5.50 mark and that is why I have included it again.

The stock has retrenched below $6 5 times over the last 12 months and has always retraced back above that mark. As high as just over $6.50 on one occasion. I have a gut feeling though that the $5.50 low is going to be tested. Too much negativity based on bad news to come surrounding the company.

This time the stock has been sold off due to bad news coming this reporting season and was given added downwards impetus when management announced a price increase for customers yesterday. Usually a reason for stocks like this to rally in the past but negative for Contact given the impact of the last price rise to consumers and the poor way in which it was executed.

A great stock for you short termers out there and a good opportunity for those of you looking for a good company on the cheap for a long-term proposition.

Management of this company is poor but even a monkey running this company can make money.

I repeat, it could go lower than its current $5.66, with a low over the last 12 months of $5.47.

Buy on further weakness if this stock has been on your watchlist.


Contact @ Share Investor Blog

Stock of the Week - Reprise: Contact Energy Ltd
Not so fast Davy Boy
Still Watching Contact Energy
Beam me up Davy
Stock of the Week: Contact Energy
MarketWatch: Contact Energy - June 2009
MarketWatch: Contact Energy - Jan 2009
Contact Energy looks bright during dark times
Share Investor's 2009 Stock Picks
Follow the Monopoly Board

Discuss this stock at Share Investor Forum - Register free


Stock of the Week Series

Restaurant Brands
NZ Refining
Ryman Healthcare
Mainfreight Ltd
Fisher & Paykel Healthcare
Xero Ltd
Auckland International Airport
Sky City Entertainment Group
Burger Fuel Worldwide
Michael Hill International
Contact Energy Ltd
The Warehouse Group
Fisher & Paykel Appliances

Related Amazon Reading


Small Investor Goes to Market: A Beginner's Guide to Picking Stocks by Jim Gard
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c Share Investor 2010

Are Insiders selling Sky City Stock?

With Sky City Entertainment Group [SKC.NZ] announcing a profit next Tuesday, the recent dramatic drop -SKC shares have fallen by almost 9% in 2 weeks - in share price for this company could mean a number of things.

The obvious reason is that investors are simply no longer interested in holding because of overall market sentiment and this has been shared with other stocks falling in a similar fashion - Telecom NZ [TEL.NZ] but one example.

The other reason could be insiders selling due to some sort of negative news coming in the profit announcement.

This stock has been prone to insider selling before profit announcements in the past and I wouldn't discount that insiders are doing the same again before Tuesday.

With a good result indicated by management last year it cant be the profit part of Tuesday's announcement but it could be a slightly worse number than telegraphed.

Perhaps a dividend cut, a poor future outlook or something unexpected is on the cards.

This is all idle speculation on my part but the big share price drop before another profit announcement is worth noting.

Of course if nothing material is going on the share price drop represents another opportunity to buy this stock, long or short term.



Sky City shares dropped 6c to NZ$3.10 in a down market on larger than average volume yesterday.

Disclosure: I own SKC shares in the Share Investor Portfolio


Share Investor Interviews

Share Investor Interview: Sky City CEO, Nigel Morrison

Sky City Entertainment Group @ Share Investor

• Sky City Entertainment 2009 FY Profit Preamble
• Sky City debts levels now more manageable
• Insider Trading on Sky City shares
• Sky City Profit Upgrade: Always on the Cards
• Sky City's Current Cinema "Boom" a Horror Story in Disguise
• Stock of the Week: Sky City Entertainment Group
• Sky City share offer confusing and unfair for smaller shareholders
• Sky City CEO doubles down
• Sky City Entertainment 2009 Interim Profit Review
• Sky City Entertainment 2009 Interim Result Preamble
• 2008 Sky City profit analysis
• Sky City Entertainment 2008 Full Year profit results , NZX release, 2008 full year presentation, result briefing webcast, financial statements
• Sky City 2008 profit preamble
• Sky City outlines a clear future plan
• As recession bites Sky City bites back
• Sky City Assets: Buy, sell and hold
• Why did you buy that stock? [Sky City Entertainment]
• Sky City Share Volumes set tongues wagging
• Sky City half year exceptional on cost cutting
• NZX Press release: Sky City profit to HY end Dec 2007
• Sky City Cinemas no Blockbuster
• Sky City Entertainment share price drop
• New Broom set to sweep
• Sky City Management: Blind, deaf and numb
• Sky City sale could be off
• Opposition to takeover
• Premium for control
• Sky City receives takeover bid
• Sky City Casino Full Year Profit to June 30 2007
• Setting the record straight
• Sky City CEO resigns
• Sky City Casino: Under performing
• Sky City Casino 2007 HY Profit(analysis)
• Sky City Casino 2007 HY Profit

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c Share Investor 2010