RISING ABOVE - Adelaide Airport

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RISING ABOVE - Adelaide Airport
RISING
 ABOVE
 ADELAIDE AIRPORT
ANNUAL REPORT 15/16
RISING ABOVE - Adelaide Airport
04
                 CHAIRMAN’S
                                                           14
                                                     FINANCIAL
                                                                                   18
                                                                               AERONAUTICAL
                   REPORT                          PERFORMANCE

                  06
                 MANAGING
                                                           12
                                                           YEAR IN
                                                                                   20
                                                                                 OPERATIONS
                 DIRECTOR’S                                REVIEW
                   REPORT

                  08
                 BOARD OF
                                                           10
                                                      EXECUTIVE
                                                                                   24
                                                                                 CUSTOMER
                 DIRECTORS                              TEAM                       FOCUS

Chairman
Rob Chapman                              Solicitors
                                         Thomson Geer Lawyers
Managing Director
Mark Young                               Auditors
                                         PricewaterhouseCoopers            Subsidiaries
Directors                                                                  100% Parafield Airport Limited
Alan Mulgrew                             Shareholders                      100% Adelaide Airport
Jim Tolhurst                             UniSuper Ltd 49.0%                Management Limited
John Ward                                Statewide Super 19.5%             100% New Terminal Financing
Jay Hogan                                Colonial First State 15.3%        Company Pty Limited
Jane Yuile                               Industry Funds Management 12.8%   100% New Terminal Construction
Chris McArthur                           Perron Investments 3.4%           Company Pty Limited

   2       ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
RISING ABOVE - Adelaide Airport
36
ENVIRONMENT
                    38
                  OUR PEOPLE

   30
  PROPERTY
                    40
                 OUR COMMUNITY

   28
INFRASTRUCTURE
                   42
                   PARAFIELD
                                  44
                                  CORPORATE
                                 GOVERNANCE
RISING ABOVE - Adelaide Airport
WE’RE RISING
                                ON THE WINGS
                                OF OUR VISION.
                                WE’RE SOARING
                                 TO GREATER
                                HEIGHTS THAN
                                   BEFORE.

4   ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
RISING ABOVE - Adelaide Airport
CHAIRMAN’S
REPORT
THE PAST FINANCIAL YEAR HAS AGAIN
DEMONSTRATED HOW ADELAIDE AIRPORT’S
PERSEVERANCE AND COMMITMENT TOWARDS
REACHING OUR OBJECTIVES REMAINS A KEY TO
ACHIEVING SUCCESS.

A year ago, as passenger numbers       Attracting a mainland China service       Adelaide Airport’s balance
started to retreat from historic       has been a long-held goal for             sheet remains in a solid position.
highs, Adelaide Airport was faced      Adelaide Airport, and we were             The company’s revenue reached
with the challenge of offsetting the   delighted to be informed by China         $187.9 million for the financial year,
loss of Air Asia X services to         Southern in July that it will introduce   up 4.6 per cent on the previous
Kuala Lumpur.                          a service between Adelaide and            year. Net profit after tax was $31.0
                                       Guangzhou in December 2016.               million, down 15.1 per cent on the
We have met the challenge head
                                                                                 previous year - largely the result of
on. Instead of taking one step back,   Other domestic and international
                                                                                 a smaller increase in fair value of
we have taken two steps forward        airlines look to consolidate and
                                                                                 investment properties.
with the signing of two of the         develop existing routes. The
world’s largest and most respected     move by Cathay Pacific in 2015            Adelaide Airport is considered
international airlines.                to fly direct to Hong Kong (rather        a leader in sustainability in the
                                       than via Melbourne) has proved            aviation sector. In 2015/16 we have
In May, we welcomed the arrival
                                       very successful, and the airline          constructed Australia’s largest
of Qatar Airways’ daily service
                                       has added services during peak            airport rooftop solar system, which
between Adelaide and Doha. This
                                       periods to meet demand. Emirates,         will reduce our overall emissions by
has increased connectivity into
                                       Singapore Airlines, Air New Zealand       10 per cent.
40 European cities and 17 North
                                       and Jetstar have all continued to
American destinations.                                                           I would like to congratulate the
                                       develop their routes, while Virgin
                                                                                 Adelaide Airport team for their hard
At the same time, our business         Australia’s Bali services are now
                                                                                 work over the past year. In addition
development team was in the midst      operated by Tigerair.
                                                                                 to the successes highlighted above,
of detailed negotiations with China
                                       Attracting airlines of this calibre       we continue to show ourselves to
Southern, culminating in the signing
                                       requires us to continue our efforts       be industry leaders in several areas.
of a Memorandum of Understanding
                                       to ensure our facilities are amongst
between the airline and the South                                                Finally I would like to welcome new
                                       the best in Australia and indeed the
Australian Government in April.                                                  Director Jane Yuile, who is highly
                                       Asia Pacific region.
                                                                                 respected in the South Australian
                                       As we announced in 2014/15, we            business community. I thank
                                       have set ourselves ambitious but          former Director Anne Howe for her
                                       achievable goals as part of our           invaluable experience and expertise
                                       30-year Vision for Adelaide Airport.      over the past five years.
                                       This includes the development of
                                                                                 The theme for this year’s annual
                                       the Airport Business District and
                                                                                 report is ‘Rising Above’. It is a
                                       tripling the size of our existing
                                                                                 succinct way of saying that in
                                       terminal, and work is progressing on
                                                                                 everything we do, we take a holistic
                                       both of these goals.
                                                                                 approach with a view to the long
                                                                                 term sustainability of the business.
                                                                                 I am confident in our ability to
                                                                                 continue this approach well into
                                                                                 the future.
RISING ABOVE - Adelaide Airport
MANAGING
DIRECTOR’S
REPORT
ADELAIDE AIRPORT IN 2015/16 HAS FOCUSSED ON REALISING
OUR RECENTLY ANNOUNCED 30-YEAR VISION TO ENSURE
WE REMAIN A CATALYST FOR ECONOMIC ACTIVITY IN SOUTH
AUSTRALIA, SUPPORTED BY CONTINUED GROWTH AND
A STRONG BALANCE SHEET.

We continue to consolidate                International passenger numbers        As is often the case in the
aeronautical growth and undertake         decreased by 8.3 per cent, largely     aviation industry, these ‘overnight
infrastructure development in line        due to the withdrawal of AirAsia       successes’ have been years in the
with our vision to be a top tier          X and Jetstar’s discontinuation of     planning, and credit must go to
business centre in the Asia               its Auckland service. However the      our business development team,
Pacific region.                           second half of the year has clearly    in coordination with the State
                                          been stronger than the first with      Government, in making this happen.
Passenger growth has been
                                          the introduction in May of Qatar
more subdued following the record                                                Adelaide Airport continues to plan
                                          Airways’ new service between
run we’ve experienced in recent                                                  for the future with infrastructure
                                          Adelaide and Doha.
years, but we have still finished                                                upgrades either being planned
in positive territory for the past        The Qatar Airways service is           or underway.
financial year with second half gains     particularly notable because
                                                                                 Negotiations have continued to find
outstripping decreases in the first       Adelaide Airport became the first
                                                                                 a developer and operator for a new
half of the year.                         airport in Australia to welcome
                                                                                 airport hotel, and we are confident
                                          an operational Airbus A350 – the
Domestic passenger numbers have                                                  of a resolution in the first half of
                                          world’s newest and most state-of-
now reached 7 million on the back                                                2016/17.
                                          the-art aircraft.
of 1.9 per cent growth. We have
welcomed a new service between            China Southern’s announcement
Adelaide and Avalon (Melbourne)           that it will begin operating between
operated by Jetstar, and a new            Adelaide and Guangzhou in
Sunshine Coast service will start         mainland China from December is
in late-2016.                             clearly a considerable step forward.

   6        ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
RISING ABOVE - Adelaide Airport
IT’S A GREAT
 FEELING TO
   ACHIEVE
WHAT WE SET
 OUT TO DO.

Planning continues on a terminal       At Parafield Airport, developer          Adelaide Airport has also been
expansion, which we expect to          Devwest has announced                    ranked in the Top 10 airports in the
start in the next 12 months. It’s      construction of a Brand Outlet           world for on time service delivery
worth noting we celebrated the         Centre adjacent Main North               in the 2015 OAG Aviation Airport
10th anniversary of our T1 terminal    Road. This project and others in         Punctuality League.
in October, and I still consider our   the precinct are benefiting from
                                                                                We continue to search for ways
facilities to be among the most        the completion of the new Main
                                                                                we can improve our customer
modern and customer-friendly           North Rd / Kesters Rd signalised
                                                                                experience. In 2015/16 we have
in Australia.                          intersection in 2015/16.
                                                                                introduced an online pre-booking
We have also completed an              I would like to thank and                service for our car parks, and we
expansion of tow off parking           congratulate all of our team for their   have expanded the number of our
facilities to the north of the main    hard work over the past year.            wonderful ambassadors by 50 per
terminal, which will help improve                                               cent to 31 volunteers.
                                       The calibre of our team and
operational capacity.
                                       the strength of our culture is           Adelaide Airport remains highly
We haven’t been alone in               demonstrated by the fact we              active in the community. Our
undertaking significant airport        secured ‘Gold Recognition’ for           Community Investment Strategy
development. Both Medstar and          excellence in Human Resources            is making a real difference to the
Royal Flying Doctor Service have       management in the Asia Pacific           lives of people connected to the
continued construction of new          Region, announced by Airport             organisations we support.
facilities adjacent Harbourtown,       Councils International (ACI).
                                                                                Thank you to our Board and
while Guide Dogs SA/NT will soon
                                                                                shareholders for their continued
start construction on a pet hotel in
                                                                                support and guidance in 2015/16.
the same precinct.
                                                                                There are clearly exciting times
                                                                                ahead as we continue to develop
                                                                                and break into new markets.
RISING ABOVE - Adelaide Airport
BOARD OF
DIRECTORS

1                                                   2

                           3

4                                                   5

                           6

7                                                   8

8   ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
RISING ABOVE - Adelaide Airport
1 - ROB CHAPMAN                         4 - ALAN MULGREW                      Non-Executive Director appointed
AssocDipBus FAICD, FFSIA                BA, GRAICD, JP                        29 July 2009 (nominated by
                                                                              Statewide Super)
Rob has enjoyed an extensive            Alan has more than 30 years’
executive career within the financial   experience as a senior aviation       • Chair of the Property
services industry, having acted as      executive both within Australia and     Development Committee
both the Chief Executive Officer of     overseas, including responsibility    • Member of the Aeronautical &
St George Banking Group (2010 to        for Perth and Sydney Airports, and      Related Infrastructure Committee
2012) and the Managing Director of      has served as a non-executive
                                                                              • Member of the Remuneration
BankSA (2002 to 2010).                  board member on high profile
                                                                                Committee (appointed 29
                                        boards spanning aviation, energy,
Non-Executive Director                                                          September 2015)
                                        construction, infrastructure and
and Chairman appointed
                                        tourism.                              7 - CHRIS MCARTHUR
25 February 2014
                                                                              B.Eng., MBA, FAICD
                                        Non-Executive Director appointed
• Member of the Property
                                        6 September 2006                      Chris is a Partner, Infrastructure
  Development Committee
                                                                              Investments, at Colonial First State
• Member of the Aeronautical &          • Chair of the Aeronautical &
                                                                              Global Asset Management. He
  Related Infrastructure Committee        Related Infrastructure Committee
                                                                              is a Director of Brisbane Airport
• Member of the Audit &                 • Member Property Development         Corporation Holdings and former
  Compliance Committee                    and Building Committee              Director of Perth Airport, and was
• Member of the Remuneration            • Member of the Remuneration          inaugural Chairman of Airports
  Committee                               Committee                           Coordination Australia Ltd.

2 - MARK YOUNG                          5 - JIM TOLHURST                      Non-Executive Director appointed
B.Ec, FCPA, FAICD, FCIS                 B.Comm, MBA, FCPA, FCIS, FAICD        30 March 2011 (nominated by
                                                                              Colonial First State Managed
Mark has played a key role in           Jim is the immediate past Chairman
                                                                              Property Ltd)
Adelaide Airport’s expansion            of the Queensland Airports Ltd
and rapid passenger growth over         group of companies, and is            • Member of the Audit &
the past decade initially as Chief      currently a non-executive director      Compliance Committee
Financial Officer and subsequently      of Leichhardt Coal Pty Ltd and        • Member of the Property
as Managing Director.                   Blair Athol Coal Pty Ltd. He has        Development Committee
                                        more than 40 years’ experience in
• Managing Director appointed 1                                               • Member of the Aeronautical &
                                        accounting and administration.
  November 2011                                                                 Related Infrastructure Committee
                                        Non-Executive Director appointed
• Member of the Property                                                      8 - JANE YUILE
                                        29 September 2004 (nominated by
  Development Committee                                                       B.Sc., MBA, FCA, FAICD
                                        Uni Super Limited)
• Member of the Aeronautical &                                                Jane is currently State Chair of
  Related Infrastructure Committee      • Member of the Remuneration
                                                                              ANZ and also currently chairs
                                          Committee
3 - JOHN WARD                                                                 both ReturnToWorkSA (formerly
BSc, FAICD, FAIM, FAMI, FCILT, FRAeS    • Chair of the Audit & Compliance     WorkCover SA) and the Advisory
                                          Committee                           Board of the Australian Centre for
John is a professional company                                                Asian Business (UniSA), and is a
director and corporate advisor.         • Member Property Development
                                                                              Director of BuiltEnvirons and the Art
He retired as General Manager             and Building Committee
                                                                              Gallery of South Australia.
Commercial of News Limited in           • Member of the Aeronautical &
2001, and was previously Managing                                             Non-Executive Director appointed
                                          Related Infrastructure Committee
Director and Chief Executive of                                               1 June 2016 (nominated by
Qantas Airways Limited.                 6 - JAY HOGAN                         UniSuper Ltd)
                                        MBA, AFAMI, JP
Non-Executive Director appointed                                              • Member of the Property
28 August 2002 (nominated by Uni        Jay has more than 40 years’             Development and Building
Super Limited)                          experience in the property              Committee
                                        development and construction
• Chair of the Remuneration                                                   • Member of the Aeronautical &
                                        industry around Australia and
  Committee                                                                     Related Infrastructure Committee
                                        overseas, across a broad range
• Member Audit & Compliance             of property asset classes. He is
  Committee                             currently Chairman of Mercure
• Member of the Property                Kangaroo Island Lodge, Bremerton
  Development Committee                 Vintners and Sevenhill Wines.
• Member of the Aeronautical &
  Related Infrastructure Committee
RISING ABOVE - Adelaide Airport
EXECUTIVE
TEAM
1 - MARK YOUNG                             4 - SUE DOYLE                          7 - EMMA BOULBY

Managing Director                          Executive General Manager              Executive General Manager
Responsible for providing and              People and Culture                     Airport Operations
championing strategic initiatives,         Responsible for people,                Responsible for airside safety,
leadership development, driving            performance, learning and              security and facilities management,
proactive business development             development, marketing, brand          as well as the management of
and engagement to deliver superior         development, community                 Parafield Airport. Coordinates the
and sustainable stakeholder                investment and executive services.     development of AAL’s strategy and
outcomes, ensuring a quality brand                                                leads process improvement and
                                           5 - KEN MAY
and custodian of a high quality                                                   innovation initiatives across
corporate and customer service             Executive General Manager              the business.
culture and facilities.                    Property                               8 - BRENTON COX
2 - SHANE FLOWERS                          Responsible for the development
                                           and management of the property         Executive General Manager
Chief Financial Officer and Joint          portfolio, including retail, leasing   Corporate Affairs, General
Company Secretary                          and tenancy management.                Counsel and Joint Company
Responsible for the sound financial                                               Secretary
                                           6 - DAVID BLACKWELL
position and commercially prudent                                                 Responsible for community
conduct of the business, including         Executive General Manager              consultation and communication,
effective reporting and stakeholder        Customer Service                       government and industry advocacy,
communications.                                                                   environmental and sustainability
                                           Responsible for all customer
                                                                                  initiatives, legal and commercial
3 - VINCE SCANLON                          service related activities including
                                                                                  affairs, WHS, compliance, business
                                           service quality, passenger terminal
Executive General Manager                                                         continuity, insurance and risk
                                           operations, T1 retail, ground
Planning & Infrastructure                                                         management, route marketing
                                           transport and the enterprise-wide
                                                                                  and development, airline liaison,
Responsible for providing airport          functions of business systems and
                                                                                  customer relations, facilitation and
planning and development of                information technology.
                                                                                  product enhancement.
both commercial and aeronautical
infrastructure, transport including
off airport infrastructure connectivity
and utilities, airspace protection,
Airport Masterplans and related
airline relations.

   10        ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
1       2

    3

4       5

    6

7       8
EVERY
                                                                               ACHIEVEMENT
                                                                              IS A TESTIMONY
                                                                             TO A GREAT TEAM
                                                                            THAT’S COMMITTED
                                                                            TO MAKING THINGS
                                                                                  HAPPEN.
THE YEAR
IN REVIEW
IN THE TOP 10 WORLDWIDE
FOR PUNCTUALITY. GOLD
RECOGNITION FOR HR
MANAGEMENT. IT’S BEEN A YEAR
OF NUMEROUS SUCCESSES.

OCTOBER                                   DECEMBER                                JANUARY

• Qatar Airways – voted Best Airline      • Cathay Pacific adds a fifth weekly    • Additional tow off parking facilities
  in the World for 2015 – announces         flight between Adelaide and             for aircraft to the north of the main
  daily service between Adelaide            Hong Kong.                              terminal are completed, creating
  and Doha.                                                                         parking for an additional three
                                          • Construction starts on the biggest
                                                                                    narrow-bodied or one wide-
• Adelaide Airport celebrates               airport rooftop system in Australia
                                                                                    bodied aircraft.
  the 10th anniversary of the               on the roof of Adelaide Airport’s
  opening of our domestic and               short term car park - big enough      • The 2015 OAG Aviation Airport
  international terminal.                   to power the equivalent of more         Punctuality League report ranks
                                            than 300 homes.                         Adelaide Airport in the Top 10
• The first ‘sod’ is turned to mark
                                                                                    worldwide for punctuality, and the
  the start of the development of
                                                                                    best in Australia.
  Guide Dogs SA’s new five-star pet
  hotel at Adelaide Airport.
• The South Australian Government
  announces Parafield Airport as
  the base for the Northern Food
  Park, creating global opportunities
  for the State’s food industry.

   12       ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
FEBRUARY                              APRIL                               MAY

• DevWest announces it will build     • The South Australian Government   • Qatar Airways’ inaugural flight
  a new brand outlet centre at          and Adelaide Airport sign a         from Doha arrives in Adelaide. It’s
  Parafield Airport, creating up to     Memorandum of Understanding         the first time an Airbus A350 has
  350 retail jobs in the region.        with China Southern, paving the     been in operation as a scheduled
                                        way for direct flights into         service in Australia.
MARCH                                   mainland China.
                                                                          • Jetstar announces it will introduce
• Jetstar launches three-weekly                                             a new service between Adelaide
  service between Adelaide and                                              and the Sunshine Coast from
  Avalon (Melbourne).                                                       September 2016.
• Adelaide Airport receives Gold
  Recognition for HR management
  in the Asian region by Airports
  Council International.
FINANCIAL
PERFORMANCE

A BIRD’S EYE VIEW
THAT SHOWS OUR SUCCESS
AS A COMPANY.

FINANCIAL HIGHLIGHTS                       • Total passenger growth of 0.7%       CREDIT RATINGS
                                             with an increase in domestic
• Revenue (excluding interest) of            passengers of 1.9%.                  The long term finance strategy of
  $187.9 million, up 4.6% from                                                    the Group continues to be reviewed
  $179.6 million in the prior year.        • Adelaide Airport Ltd (AAL)           by the rating agencies, Standard
                                             established commitments for          and Poor’s and Moody’s. BBB/
• Earnings before interest, tax,             bank debt of $285 million with       Baa2 ratings with a stable outlook
  depreciation and amortisation              the funds scheduled to replace       continue to be maintained with each
  and fair value adjustment of               the maturing 2016 MTNs in mid-       of these agencies respectively.
  investment properties of $112.3            September 2016. The bank debt
  million, up 4.2% from $107.8               provides funding for the maturing    FINANCIAL ANNUAL REPORT
  million in the prior year.                 2016 MTNs and an allowance for       FOR THE 12 MONTHS TO 30
                                             upcoming capital expenditure.        JUNE 2016
• Net profit before tax of $43.7
  million (last year net profit before     FINANCIAL RISK MANAGEMENT              The Financial Annual Report
  tax of $52.3 million). Excluding                                                for the 12 months to 30 June 2016
  the fair value adjustment for            The Group manages its exposure         comprising:
  investment properties and                to interest rate fluctuations using
  financial instruments this year          interest rate swaps.                   • director’s report
  is $29.9 million (last year                                                     • auditors independence
                                           The Group has fixed loans and
  $23.5 million).                                                                   declaration
                                           swaps in place which currently
• After funding interest on                cover 84% of the loan principle        • financial report
  borrowings and dividends on              outstanding.
  RPS, cash flow from operating                                                   • director’s declaration
                                           Average fixed interest rate paid was
  activities was a positive $35.4                                                 • independent auditors report
                                           5.4% (last year 5.0%).
  million (last year $42.5 million).                                                to members is available on
                                           The group manages its exposure           the company’s website
• Dividends on redeemable
                                           to foreign currency risk on its US$      (www.adelaideairport.com.au).
  preference shares of $21.8 million
                                           borrowings using cross currency          Alternatively a copy may
  (last year $21.5 million). In addition
                                           swaps which cover 100% of the            be obtained from the
  special dividends of $45.0 million
                                           principal and interest payments.         Company Secretary
  (last year $30.0 million) paid in the
  current year.
• Increase in fair value of investment
  properties of $16.7 million (last
  year increase of $27.3 million).

   14        ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
INCOME STATEMENT
$’000                                                            2012           2013           2014              2015            2016
REVENUE
Aeronautical                                                   75,829         79,934         84,987         88,287             93,596
Commercial trading revenue                                     31,800         36,716         42,212         45,262             46,724
Property Revenue                                               36,678         40,057         41,948         43,240             44,709
Other Revenue                                                   1,868          1,699           1,992         1,938              1,953
Other Income                                                      848          1,070             940              869             889
Total Revenue  1
                                                              147,023        159,476        172,079        179,596         187,871
Increments/(decrements) in fair value of
                                                                5,900         11,305         10,277         27,345             16,745
investment properties
Operating Expenses                                            (64,064)       (67,834)       (70,039)       (71,801)        (75,550)
EBITDA                                                         88,859        102,947        112,317        135,140         129,066
EBITDA (Adjusted)2                                             82,959         91,642        102,040        107,795         112,321
Margin                                                         56.4%          57.5%           59.3%         60.0%              59.8%
Depreciation, impairment and amortisation                     (16,188)       (17,704)       (19,177)       (19,592)        (21,537)
EBIT                                                           72,671         85,243          93,140       115,548         107,529
Borrowing Costs
Interest on senior debt, net of interest income               (37,706)       (42,145)       (43,275)       (43,273)        (39,117)
Interest on Airport Notes/Dividends on RPS                    (28,284)       (28,362)       (30,189)       (21,468)        (21,804)
Increments/(decrements) in fair value of financial
                                                                     -              -                 -       1,520            (2,954)
instruments
Net Profit/(Loss) Before Tax                                    6,681         14,736         19,676         52,327             43,654
Income Tax (Expense)/Benefit                                   (2,037)        (4,234)        (5,934)       (15,841)        (12,664)
Net Profit (Loss) After Tax                                     4,644         10,502          13,742        36,486             30,990

Note 1: Excludes interest revenue
Note 2: Excludes adjustment in fair value of investment properties

BALANCE SHEET

$ million                                                                                                 2015          2016

Cash                                                                                                      84.2          68.1

Total Assets                                                                                              1,107.9       1,129.8

Interest Bearing Liabilities (excl stapled securities)                                                    671.7         760.0

Total Liabilities (excl stapled securities)                                                               854.3         914.4

Total Equity (plus Stapled Securities)                                                                    253.6         215.4

CAPITAL STRUCTURE
Issue                                                                          Facility ($ million)       Term
Working Capital Facility ($20.0m available at year end)                        $20.0                      Dec 2016
Bilateral Facility (2018) (Floating interest, $50.5 available at year end)     $165.0                     Apr 2018
Medium Term Note ($100m fixed interest)                                        $265.0                     Sep 2016
Redeemable Preference Shares (RPS)                                             $188.6                     Jun 2024
US Bonds USD                                                                   $285.5                     Sep-2025, 2027,2030
US Bonds AUD                                                                   $50.0                      Sep-2025, 2030
Bilateral Facility (2021,2023) (Deferred draw-down, Floating Interest)         $285.0                     2021,2023
FINANCIAL                                                                                  EBITDA (excl.
                                                                                           fair value
                                                                                           adjustments

PERFORMANCE                                                                          140

                                                                                     120

WE’RE A CATALYST FOR                                                                 100

ECONOMIC ACTIVITY,

                                                                          MILLIONS
                                                                                     80
SUPPORTED BY CONTINUED
GROWTH AND A STRONG                                                                  60

BALANCE SHEET.                                                                       40

                                                                                     20

                                                                                      0       FY12          FY13     FY14     FY15       FY16

                  Passenger                                                                Revenue
                  Movement
           8.00
                                                                                     250

           7.80
                                                                                     200
           7.60
MILLIONS

                                                                          MILLIONS

           7.40                                                                      150

           7.20
                                                                                     100

           7.00

                                                                                      50
           6.80

           6.60     FY12      FY13     FY14      FY15      FY16                        0      FY12          FY13     FY14      FY15      FY16

                              24%
 Aeronautical Traffic Performance
                              Property                                                                             Change
                                                                                                                              Change since
 Financial year                                             1998        2015                         2016     against prior
                                                                                                                               privatisation
                                                                                                                      year

 Passengers

 Domestic1                                              3,745,443   6,906,442               7,035,242                1.9%             87.8%

 International                                           227,381     935,553                   50%
                                                                                              857,806    -8.3%                        277.3%

 Total (Excluding transit passengers)              REVENUE
                                                    3,972,824       7,841,995                  Aeronautical
                                                                                            7,893,048     0.7%                        98.7%

 International Transit passengers                          31,107        500                          315          -37.0%             -99.0%

 Total (Including transit passengers)                   4,003,931   7,842,495               7,893,363                0.6%              97.1%

 Aircraft movements

                     26%
 Regular Passenger Transport                              70,204       80,014                   79,687               -0.4%            13.5%

 General Aviation    Commercial                           35,076       24,016                  23,338               -2.8%             -33.5%
                     trading &
 Total aircraft movements                                105,280     104,030                  103,025                -1.0%             -2.1%
                     other
 Landed tonnes

 Total landed tonnes                                    1,622,681   2,604,441               2,575,039                -1.1%            58.7%

 Note 1: Includes domestic on carriage

           16       ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
24%
            Property

                                   50%
                         REVENUE   Aeronautical

            26%
            Commercial
            trading &
            other

       11%
       International

PASSENGER
MOVEMENT

89%
Domestic
AERONAUTICAL
BUSINESS
DEVELOPMENT
THE NUMBERS TELL A GREAT STORY.
WE’RE EXPANDING OUR DOMESTIC
AND INTERNATIONAL MARKETS.

OVERVIEW                                  Other incumbent carriers            PERFORMANCE
                                          such as Cathay Pacific and
Adelaide Airport has maintained its       Singapore Airlines also continued   International passengers decreased
position as Australia’s fifth largest     to add supplementary flights        by -1.6% on incumbent carriers but
airport as we continue to grow our        into the Adelaide market during     international seat factor rose +4.3
domestic and international services.      peak months.                        percentage points to 81.8% with
                                                                              incumbent operators benefiting
Total passenger growth of 0.7% was        Adelaide has a mature domestic      from the unexpected withdrawal of
driven by growth in the domestic          network and carriers continue       AirAsia X service.
markets, which has compensated            to steadily increase capacity
the withdrawal of AirAsia X’s Kuala       and adding new routes. Jetstar      Domestic passengers grew +1.9%
Lumpur service.                           introduced three-weekly service     to 7.0 million. This was the result
                                          between Adelaide and Avalon         of incremental airline capacity
Adelaide welcomed the introduction
                                          in March 2016. The airline also     additions on trunk routes, in
of a daily service by Qatar Airways
                                          announced in May that it would      addition to the new Avalon service.
in May 2016 between Adelaide
and Doha. Adelaide was the first          add more capacity in the Adelaide
airport in Australasia to receive the     market by introducing a three-
A350 operation. The Qatar service         weekly service to the
has increased connectivity into           Sunshine Coast.
40 European cities and 17 North
American cities.
Our key focus in 2015/16 was
to convince a Chinese carrier to
introduce a direct service between
Adelaide and mainland China.
The first milestone was achieved
in April 2016 when China Southern
Airlines signed a Memorandum
of Understanding with the South
Australian Government to jointly
promote the growing demand for
tourism to South Australia. This
culminated in an announcement                                                21 DOMESTIC AND
in July 2016 by China Southern
Airlines that it would introduce                                          REGIONAL DESTINATIONS
a three-weekly service between                                              BY DECEMBER 2016
Adelaide and Guangzhou from
December 2016.

   18       ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
2.0%
                       Conferences
                       Meetings &
                       Exhibitions

30.0%
Leisure

                                           33.7%
                                           Visiting
                                           Friends &
                                           Relatives
              INTERNATIONAL
               ARRIVALS FY16

10.8%
Business &
Employment
                                 9.5%
                                 Other
               14.0%
               Education
                                         0.9%
                                         Education

                                                           25.2%
                                                           Visiting
                                                           Friends &
                                                           Relatives

                                                                2.4%
                               INTERNATIONAL                    Conferences
                                DEPARTURES                      Meetings &
                                    FY16                        Exhibitions
             57.9%
             Leisure
                                                               7.8%
                                                               Business &
                                                               Employment

                                                       5.8%
                                                       Other
ADELAIDE AIRPORT
                                                      IS IN THE TOP 10
                                                   AIRPORTS WORLDWIDE
                                                     FOR PUNCTUALITY

OPERATIONS
THE PURSUIT OF OPERATIONAL
EXCELLENCE IN SAFETY AND
SECURITY REMAINS A KEY STRATEGIC
PRIORITY FOR ADELAIDE AND
PARAFIELD AIRPORTS.

We regularly update and test our          FACILITIES                            AERONAUTICAL
plans with control authorities,
                                          We now operate Australia’s largest    The 2015 OAG Aviation Airport
emergency services and business
                                          airport rooftop solar system. The     Punctuality League has ranked
partners to ensure best practice in
                                          $2.5m project, which delivers over    Adelaide Airport 7th globally for
managing the airfield.
                                          1,700 MWH per year, was delivered     small airports (less than
SAFETY & SECURITY                         on time and within budget. It will    10 million passengers) and 8th
                                          reduce overall airport emissions by   overall, putting us in the Top 10
Our annual emergency field
                                          close to 10%, enabling the airport    airports worldwide for punctuality,
exercise took place in June
                                          to achieve its carbon goal in just    and the best in Australia.
enabling key agencies to practise
various aspects of emergency              one year.                             The OAG Punctuality League
preparedness, operational                                                       2015 is the industry’s most
response, command, coordination                                                 comprehensive annual ranking of
and control functions.                                                          on-time performance (OTP) for the
                                                                                world’s airlines and airports.
                                                                                The on-time performance of airlines
                                                                                and airports plays a valuable role in
                                                                                the industry and has the power to
                                                                                bring about positive change in the
                                                                                future of aviation.

   20       ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
AERONAUTICAL
BUSINESS
DEVELOPMENT
CLEARLY, WE’RE HEADED
IN THE RIGHT DIRECTION.
                                                                  AIRCRAFT
                                                                 MOVEMENTS

                                                       79,687 | -0.4%
                                                      Domestic and Regional
                                                         75,445 | +0.3%
                                                          International
                                                         4,242 | -11.3%

                                         PASSENGER
                                         MOVEMENTS

                         7.9 Million | +0.7%
                         Domestic and Regional
                             7.0m | +1.9%                                             SEAT
                             International                                           FACTOR
                             0.9m | -8.3%

                                                                        76.2% | +1.0%
                                                                      Domestic and Regional
                                                                         76.0% | 0.0%
                                                                          International
                                                                         81.8% | +4.7%

 22   ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
CHINA
                                China
                               Southern

        HONG KONG                            INDONESIA
        Cathay Pacific                          Jetstar
                                                Tigerair

                                                            UNITED
MALAYSIA                 8 INTERNATIONAL                    ARAB
 Malaysia
 Airlines                DESTINATIONS BY                   EMIRATES
                                                            Emirates
                          DECEMBER 2016

              NEW
            ZEALAND                          SINGAPORE
             Air New                          Singapore
             Zealand                            Airlines

                               QATAR
                             Qatar Airways
PROVIDING EASE,
                                                                                  SEAMLESSNESS
                                                                                 AND CONNECTIVITY
                                                                                    TO ALL OUR
                                                                                   CUSTOMERS.

CUSTOMER
FOCUS
WE’RE ENABLING CUSTOMERS,
TRAVELLERS AND PARTNERS
TO HAVE A GREAT EXPERIENCE.

In seeking to fulfil our vision to        TERMINAL OPERATIONS                     CAR PARKING
provide exceptional customer
service, Adelaide Airport in 2015/16      Adelaide Airport’s international        The introduction of a new online
has continued to introduce and            customers have benefited from the       car park booking system has
enhance products and services             expansion of departure facilities.      significantly improved the customer
while ensuring we measure up                                                      experience for thousands of our
                                          A second Liquids Aerosols and
against the best in the world.                                                    regular car park users.
                                          Gels (LAGS) security lane has been
Adelaide Airport’s Customer               installed to provide a smoother         Online bookings continue to grow
Service Business Unit continues           transition into the immigration         as we refine our marketing and
to be responsible for the majority        processing area.                        change from a rather static to more
of customer-facing activities,                                                    dynamic pricing system. Under
                                          The Department of Immigration
including terminal operations,                                                    the dynamic pricing system we are
                                          and Border Protection meanwhile
ground transport, retail, commercial                                              able to vary the price of parking
                                          has installed six new SmartGates
and security screening facilitation.                                              products depending on a range of
                                          at International Departures, which
The unit is also responsible for                                                  market factors. This is a very similar
                                          again has improved the efficiency of
business and information services,                                                system to that used by airlines for
                                          processing passengers
Ecommerce, the Ambassador                                                         seat pricing.
                                          travelling overseas.
(volunteer) program and overall                                                   As parking transactions grow, we
customer experience.                                                              remain focused on the customer
                                                                                  experience and this is an area in
                                                                                  which we’ve made great gains
                                                                                  in the past 12 months. We have
                                                                                  coupled our world class customer
                                                                                  management system with great staff
                                                                                  and the result has been very high
                                                                                  levels of positive feedback for our
                                                                                  car parking products.

   24       ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
Through our online car parking         CUSTOMER SATISFACTION                   To ensure we are measuring our
system and related support portal,                                             performance as a top tier airport
we engage with customers 4 times       Adelaide has placed very high in        against realistic benchmarks, we
more often (average of 140 per         overall passenger satisfaction as       continue to benchmark against all
month) than all other Adelaide         measured by the Airports Council        Australian and New Zealand ASQ
Airport customer engagements           International’s Airport Service         participant airports and we’re also
combined (an average of                Quality (ASQ) surveys.                  now benchmarking against the
35 per month).                         Even as customer expectations           best airports of similar size and
                                       continue to change, we have             customer focus from around the
Customer surveys have been
                                       remained a consistently high ASQ        world. Examples include regional
implemented after each parking
                                       performer when compared with all        high performers such as Osaka
activity to track customer sentiment
                                       participating Australian and New        and Chang Mai, and global high
(Net Promoter Score), as well gauge
                                       Zealand airports.                       performers Edmonton, Cape Town
the level of support our customers
                                                                               and Austin-Bergstrom airports. We
receive using the ‘Easy’ scoring       In the past year we have expanded       will continue to update and refine
system. In both cases the feedback     and revitalised our Ambassador          this panel to ensure that we remain
has been positive and encouraging,     volunteer program, while also           focused on achieving a high quality
and continuing to improve.             extending the opening times             customer experience. 80 per cent of
                                       of the information booth. The           respondents rated Adelaide Airport
                                       booth now also manages all lost         as either “Very Good” or “Excellent”
                                       property, significantly increasing      during FY16.
                                       the opportunities for travellers to
                                       reclaim lost items.
                                       Some of the major projects that we
                                       expect to positively impact upon
                                       our service quality scores in the
                                       next year include the terminal toilet
                                       upgrades / refurbishments and the
                                       public (free) Wi-Fi service.
NET PROMOTER SCORE
                                           (NPS) RESULTS
                                        The net promoter score calculates
                                          responses to a single question:
                                  How likely is it that you would recommend our
                                       company/product/service to a friend
                                       or colleague? The overall nps survey
                                            score can be as low as −100
                                             (everybody is a detractor)
                                   or as high as +100 (everybody is a promoter).
                                   An nps that is positive (i.e., Higher than zero)
                                         is considered good and an nps of
                                    +50 is considered great. Our nps measure
                                        has increased from +45 when first
                                            measured in November 2015
                                                 to +59 in June 2016.

AMBASSADORS                               BIKE FACILITIES

Adelaide Airport’s Ambassador             Bicycle facilities and services
program has undergone significant         were further upgraded in time for
expansion, with the number of             January’s Tour Down Under and
ambassadors increasing from 21 to         associated influx of cyclists.
31 at the beginning of this year.
                                          A new secure Adelaide Metro
The inclusion of the additional           bike cage was completed for use
volunteers has allowed Adelaide           by customers with a registered
Airport to greatly increase its           Adelaide Metrocard. Other bicycle
customer service presence right           facilities at Adelaide Airport
across the day.                           include bicycle service stations
                                          for assembly, disassembly and
Next year will see the recruitment
                                          minor maintenance of bicycles, free
of more multi lingual Ambassadors
                                          bicycle racks for up to 12 bikes,
to meet the needs of the expanding
                                          and bicycle box ‘recycling’ service
international customer traffic.
                                          during major cycling events.

  26       ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
Great, easy access
                                     and awesome rates!!!

        Loved that even after
      we pre-paid we messed up
      and got a ticket upon entry                             Easy to do online
      you were onto it with a text                          plenty of parking not
       message for an easy fix.                               far from terminal

                                         ONLINE
                                      CAR PARKING
Excellent service
and easy to follow.                     BOOKING

                                        CUSTOMER
                                        COMMENTS

      So easy just drove in
    parked, came back a few
    days later and drove out.
       Cheaper than taxis
       and far less stress.
INFRASTRUCTURE
DOING WHATEVER IS NECESSARY TO
ENSURE THAT WE BECOME A TOP-TIER
AIRPORT BUSINESS CENTRE IN THE
ASIA PACIFIC REGION.

As we look to bring our 30-year            Adelaide Airport has been                New LED lighting has been installed
Vision to life, Adelaide Airport           upgrading the building housing the       to align with Adelaide Airport’s
continues to undertake significant         Vickers Vimy aircraft; completed in      environmental strategy, as well as
infrastructure projects that improve       August 2016.                             a number of other design features
both operational capacity and                                                       to assist in minimising the amount
                                           The Vickers Vimy aircraft is an
amenity at the airport.                                                             of damaging sunlight from affecting
                                           iconic piece of aviation history as
                                                                                    the materials and finishes of the
A project to provide additional tow        the first aircraft to fly from England
                                                                                    fragile aircraft.
off parking facilities for aircraft to     to Australia in 1919.
the north of Adelaide Airport’s main                                                At Parafield Airport, the Kesters
                                           The upgrade has increased visibility,
terminal has been completed.                                                        Road Intersection on Main North
                                           access and awareness of the
                                                                                    Road now has new traffic light
The Northern Tow Off Parking Area          historic aircraft and improved the
                                                                                    access to the southern commercial
project has created parking for an         environmental conditions within
                                                                                    precinct. This $6.3m project was
additional three narrow-bodied             the pavilion in order to enhance
                                                                                    delivered by AAL in consultation
or one wide-bodied aircraft. The           conservation of the plane.
                                                                                    with the Department of Planning
existing Ground Storage Equipment
                                           The project included the                 Transport and Infrastructure (DPTI).
area has also been expanded.
                                           construction of a new external
                                                                                    The scope included almost
The works involved the partial             canopy and curved plywood
                                                                                    1.4km of works on Main North
demolition of the northern regional        screens, which referenced the
                                                                                    Road and significant stormwater
covered walkway to facilitate the          curves on the Vickers Vimy wings
                                                                                    enhancements. The project was
removal of existing pavement and           and propellers, and created an
                                                                                    delivered on time ready for the
construction of a new tow off hard         attractive entry into the larger
                                                                                    opening of Hungry Jack’s as the
stand for a range of aircraft types.       viewing area.
                                                                                    first new development in
                                                                                    the precinct.

   28        ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
MORE AIRCRAFT
PARKING TO IMPROVE
 OUR OPERATIONAL
     CAPACITY
APPROVAL
            FOR NEW ALDI
            SUPERMARKET
               IN 2017

30   ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
PROPERTY
THE PAST 18 MONTHS HAS BEEN OUR MOST ACTIVE IN THE
PROPERTY SECTOR. WE’RE POWERING JOBS AND ECONOMIC
GROWTH IN THE NORTHERN AND WESTERN SUBURBS.

ADELAIDE AIRPORT                        RETAIL                                    ALDI

TERMINALS AND                           During the past 12 months the retail      Development of an Aldi supermarket
BUSINESS PRECINCTS                      property team has delivered on the        on the corner of Vimy Avenue and
                                        strategic plan for T1 retail.             Butler Boulevard in the Burbridge
Adelaide Airport in 2015/16 has                                                   Business Park was approved by
continued to develop strategy and       In October 2014 the board approved
                                                                                  Adelaide Airport Ltd in May 2016.
planning for the Airport Business       a Retail Transition Strategy to
                                                                                  This followed a comprehensive
District – a globally connected, next   transition the retail tenancies on
                                                                                  assessment and review of a
generation hub with designated          short term leases while achieving
                                                                                  Merit Use application under the
industry clusters across a range        rental income growth and
                                                                                  Adelaide Airport Master Plan 2014
of industries. This is a key element    refurbishments. This process was
                                                                                  involving agency referral and public
of our 30-year Vision, announced        well underway in 2015/16 aligned
                                                                                  consultation, which determined
in 2014, to deliver further growth      with a refurbishment program.
                                                                                  certain conditions as part of the
for the greater benefit of the South    A particular highlight has been           development.
Australian economy.                     the three-year renewal of leases
                                                                                  The Merit Use approval for the
An important part of the Airport        with Delaware North including a
                                                                                  nominated 6,500 m2 site will
Business District is the linkages       new Coopers Alehouse replacing
                                                                                  allow a ground lease to Aldi for
with the terminal and associated        its previously segregated space
                                                                                  the construction of a supermarket
developments. To that end we have       adjoining the 1862 Bar. Another
                                                                                  building, including storage and
been progressing well with plans        highlight was the two-year lease
                                                                                  associated car parking, which is
for a new airport hotel and the         renewal of the Aelia Duty Free
                                                                                  expected to occur in 2017.
expansion of existing                   business, including plans for
terminal facilities.                    an additional South Australian
                                        providore component aimed at the
                                        emerging China market and a MAC
                                        cosmetics store.
                                        All lease renewals are to be
                                        delivered consistent with the
                                        overarching theme of a sense of
                                        place. There are 37 total retail stores
                                        in T1 with a retail gross lettable area
                                        of 4,769m2.
AEROMEDICAL
              PRECINCT PROVIDES
                NEW HOME FOR
              MEDSTAR AND RFDS

TAPLEYS PRECINCT                           The building has been designed for         ROYAL FLYING DOCTOR
                                           operational efficiencies aligned to        SERVICE CENTRAL
MedSTAR FACILITY                           helicopter boarding and mobilisation       OPERATIONS BASE
                                           with the ground floor comprising
The SA Ambulance Service                   secure and undercover garaging for         The Royal Flying Doctor Service
MedSTAR Rescue Retrieval                   operational vehicles, Rescue Team          has developed a bespoke, state-
Base has recently commenced                preparation, equipment storage,            of-the-art facility at the southern
construction adjacent the existing         operational briefing and meeting           end of Sir Reginald Ansett Drive.
Australian Helicopters facility on Sir     rooms, simulation training rooms,          The new facility has been designed
Reginald Ansett Drive.                     debriefing rooms and training              to bring RFDS operations and
The location will enable MedSTAR           hangar and gym.                            administrative personnel together
Retrieval Teams to achieve ‘world’s                                                   under the one roof for the first time,
                                           The upper floor has commercial             and will relocate the RFDS aviation
best practice’ in Rotary Wing              office space for administration. A
response times with teams able to                                                     and ambulance operations to this
                                           70-seat lecture theatre with inbuilt       new location from its old locality on
mobilise and board the helicopter          flexibility to double as a training area
within two minutes. The new facility                                                  James Schofield Drive.
                                           has a viewing platform overlooking
will supersede the current outdated        the training hangar to facilitate          The new 5,400m2 facility comprises
facility on James Schofield Drive          training observation.                      commercial office space over two
and eliminate the need for response                                                   levels for RFDS operational and
teams to drive around the airport to       The airside interface will include an      administrative personnel, a hangar
board a waiting helicopter.                880m2 apron adjoining the existing         and maintenance facility for six
                                           Australian Helicopters apron to            aircraft, and patient transfer and
Being constructed on a 4,616m2             allow for efficient and optimal
site with an additional 1,565m2                                                       care facilities with a dedicated
                                           mobilisation and boarding of               ambulance bay for safe and
airside licensed area, the new two-        helicopters.
storey 3,500m2 building will provide                                                  efficient patient transfers. The site
operational, administrative and            The close proximity of the Rescue          includes crew sleeping quarters,
training facilities.                       Retrieval Base to the RFDS                 and associated staff and visitor
                                           Base will provide synergies and            car parking. The facility has an
                                           engagement between the two                 integrated 19,200m2 aircraft apron
                                           organisations aligned with aero            and taxiway which was delivered
                                           medical practice and learning.             under a separate contract by AAL.

                                           The Rescue Retrieval Base is               The building achieved practical
                                           scheduled for completion in                completion in July 2016 with RFDS
                                           July 2017.                                 personnel to begin transitioning into
                                                                                      the facility in September 2016.

   32        ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
PET HOTEL                                  A separate and acoustically
                                           isolated cattery area will provide
Guide Dogs SA/NT is developing             accommodation for up to 30 cats.
South Australia’s first ‘bespoke’ pet      The pet hotel will also have a
hotel on a 6,577m2 site on Navaid          ‘pocket pet’ area for small pets such
Road immediately west of the               as rabbits, guinea pigs, budgies and
existing AFP K9 facility.                  the like.
The location at Adelaide Airport was       The site lease area allows extensive
identified by Guide Dogs SA/NT             outdoor play areas and on site
as strategically and ideally suited        visitor and staff car parking.
to the notion of a pet hotel aligned
with ‘pet parents’ having a caring         The location at Adelaide Airport
and high quality facility to leave their   will provide travellers with the
beloved pets whilst on holidays. The       convenience of drop off and pick
facility will be an important revenue      up of pets aligned with their holiday
stream to support the Guide Dogs           and business travel itineraries as
SA/NT core business of helping and         well as the obvious convenient
supporting people with disability.         alignment to nearby local holiday
                                           / tourism facilities such as the
The 2,650m2 building will contain          Adelaide Shores Caravan Park. The
a large hotel-style reception and          pet hotel will also provide a high
foyer, 18 luxury kennel suites, a          quality day care service - the first of
standard kennel area for up to             its kind in the Adelaide market.
126 dogs (with the provision for
an additional future 84 kennels),          The Pet Hotel building application
extensive indoor play areas and            has been approved and is out for
exercise yards, a grooming/washing         tender with a select contractor
area, an isolation kennel area             group. Construction is targeted
supported by a veterinarian room,          to begin in September 2016 with
and ancillary food preparation and         the facility to be operational in the
storage areas.                             second half of 2017.
TORRENS PRECINCT                          PARAFIELD AIRPORT                      MASTERS

The University of Adelaide has re-        NORTHERN ADELAIDE FOOD                 The development of the Masters
invigorated the land west of Tapleys      PARK                                   Hardware and Home Improvements
Hill Road into sporting grounds                                                  Store was completed in April 2016,
through re-irrigating, seeding and        Parafield Airport in October           together with Officeworks and
landscaping. The playing fields           2015 was selected as the South         Hungry Jack’s stores. Woolworths
will be configured as four cricket        Australian Government’s preferred      has now confirmed that it will exit
ovals and six soccer grounds, with        option for the development of its      the portfolio of Masters stores by
associated player and visitor car         Northern Adelaide Food Park. The       December 2016 with an expectation
parking. Recycled water from the          state-of-the-art development will      the buildings will be converted to a
Glenelg Sewerage Treatment                enable food manufacturers, food        suite of “big box” retail shops
Works will be used to irrigate the        packaging specialists, cold-chain      in 2017.
grassed areas.                            suppliers and transport companies
                                          to expand and grow.                    BRAND OUTLET CENTRE

                                          The South Australian Government        Parafield Airport and developer
                                          through the Department of State        Devwest have completed an
                                          Development and the Economic           Agreement for Lease for the
                                          Development Board initially            development of a Brand Outlet
                                          requested information in respect       Centre on a four hectare site
                                          to land parcels suitable for the       located immediately north of the
                                          development of a food park in          Masters development, with shop
                                          northern Adelaide in May 2015          tenancy marketing occurring since
                                          on the premise that the export         January 2016.
                                          of South Australia’s high quality
                                                                                 It is forecast the centre will create
                                          food and beverages was a huge
                                                                                 up to 350 jobs once opened,
                                          opportunity for the State both now
                                                                                 providing a significant boost for
                                          and into the future. The nominated
                                                                                 economic growth in the northern
                                          minimum land parcel size was 40
                                                                                 suburbs. The centre fits within
                                          hectares with an emphasis on being
                                                                                 the objectives of the Commercial
                                          development ready.
                                                                                 Estate Precinct as outlined in
                                          Parafield Airport submitted land       Parafield Airport’s 2012 Master
                                          available within the Cross Keys        Plan. Aligned with this development
                                          precinct, which had the added          will be the relocation of Rivergum
                                          potential to expand beyond 40          Homes Display Centre from its
                                          hectares if required and further       current location to a new site in the
                                          potential to provide an additional     Levels Precinct accessed from the
                                          20 hectares of land within the Kings   recently-constructed Kesters Road
                                          Precinct if required.                  signalised intersection with Main
                                                                                 North Road.
                                          Following selection of Parafield
                                          Airport by the State Government,
                                          a Memorandum of Understanding
                                          with the Department of Primary
                                          Industries and Resources South
                                          Australia (PIRSA) has been agreed
                                          to work collaboratively in the
                                          development of the Food Park.
                                          Parafield Airport and PIRSA have
                                          since undertaken pre-feasibility
                                          analysis to identify occupancy
                                          demand and specifications. This
                                          in turn has enabled engineering,
                                          sustainability and architectural
                                          design to envisage a fully
                                          developed estate.

   34       ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
PARAFIELD IS
STABLE, INCLUSIVE
AND PROGRESSIVE
 - CREATING JOBS
 AND GROWTH IN
     THE NORTH
HOME TO
                                                        AUSTRALIA’S
                                                     LARGEST AIRPORT
                                                      ROOFTOP SOLAR
                                                          SYSTEM

36   ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
ENVIRONMENT
TAKING THE LEAD IN A
HOST OF ENVIRONMENTAL
INITIATIVES.

Sustainability, including               • Partnering with SA Water to          • The development of an advanced
environmental sustainability,             conduct an Urban Heat Island           wildlife hazard management
is central to Adelaide Airport’s          Reduction Trial aimed at               system, which incorporates
vision. AAL is committed to               investigating the use of irrigated     mobile device application-based
maintaining its leadership position       areas for large scale temperature      data collection, detailed lead
in environmental sustainability,          regulation. The value of this          indicator, and GIS map-based
further reducing its environmental        research was recently recognised       analysis and reporting.
footprint and to environmental            by the SA Stormwater Industry
                                                                               AAL’s environmental compliance
legislative compliance.                   Association, winning an award for
                                                                               and sustainability goals include
                                          Excellence in Research
AAL has realised a number                                                      complying with and/or exceeding
                                          and Innovation;
of significant environmental                                                   legislative requirements, effecting
achievements under its current          • Commencement of a long-term          change relating to the activities
environment strategy including:           study into the use of targeted       under the direct control of AAL,
                                          vegetation types as a passive        and influencing change through
• Installation of a 1.2 MW
                                          control measure to control the       collaboration and negotiation with
  photovoltaic solar array on the
                                          number and species of birds on       key stakeholders.
  roof of the multi-deck car park,
                                          the airfield, and consequently
  the largest roof-top array at                                                We are tracking well against our
                                          reducing the aviation safety risk
  an Australian airport. At peak                                               strategic objectives related to
                                          associated with bird strikes;
  performance it is capable of                                                 environmental compliance and
  producing around 80% of the           • Participation in the Cooperative     reducing our environmental footprint
  airport business precinct’s energy      Research Centre for                  as outlined in the Adelaide Airport
  needs;                                  Contamination Assessment and         Master Plan 2014.
                                          Remediation of the Environment,
• Development of Climate Change
                                          Technical Working Group for
  Adaptation Plans for Adelaide and
                                          perfluoroalkyl and polyfluoroalkyl
  Parafield Airports to provide a
                                          substances, which is developing
  framework for identifying potential
                                          guidance for this group of
  risks to airport operations
                                          emerging contaminants that will
  posed by climate change and
                                          ultimately be adopted in State and
  to initiate the discussion around
                                          Federal legislation; and
  management measures that
  may be required to address the
  identified risks in the future;
OUR PEOPLE
ADELAIDE AIRPORT RECOGNISES THAT PUTTING
‘PEOPLE’ AT THE CORE OF THE COMPANY’S
BUSINESS STRATEGY HELPS TO DRIVE GROWTH,
INNOVATION AND LEADERSHIP.
In 2012 we set about revising our         Our ‘Moments That Matter’ program        Our focus on diversity has seen
strategy for long-term growth             continues to prove popular and has       female staff numbers increase
and sustainable operations,               contributed to HR management.            year-on year in what is traditionally
with a strong focus on people,                                                     a male-dominated industry. We
                                          In 2015/16 we conducted
community and the environment.                                                     recognise the need for flexible
                                          workshops across all departments
We recognised the role that society                                                working arrangements, particularly
                                          focussing on our values and how
and the environment play in the                                                    given the challenges of our 24/7
                                          we contribute to the strategic plan
economics and longevity of the                                                     airport operation.
                                          by living our company values and
business, our people and our
                                          documenting how behaviours and           In the past year, as a result of
reputation in the community when
                                          actions translate differently across     feedback from our staff engagement
these elements work together.
                                          departments. We also considered          survey, we’ve introduced a new
When the ‘People Strategy’ is at          what our values look like in practice,   Performance Management System.
the core of the business strategy         by describing ‘Moments that Matter’      This system allows our people
it results in a more engaged,             to our customers (both internal and      and their managers/leaders to
productive and ‘happier’ business         external), giving an impression of       work together to plan, monitor and
and benefits the bottom line.             great service.                           review their work goals and overall
                                                                                   contribution to the company.
We have moved to a culture of             Our core value remains ‘Our
empowerment and accountability,           Promise to Each Other’, which was        More than just an annual
responsible for contributing to           launched in 2014 as an internal          appraisal, our new system is a
and fostering innovation, diversity       service charter.                         continual process of setting goals,
and engagement, and integrating                                                    assessing progress and providing
                                          Our Promise describes the
environmental considerations in the                                                on going feedback through
                                          commitment, attitude and
way we think and work.                                                             ‘connecting conversations’.
                                          behaviours expected of us to
Our Leadership Framework best             maintain a culture of great customer     In addition to our own team,
demonstrates where we want to             service. Our Promise ensures we          Adelaide Airport looks to recognise
be as a business. This framework          hold ourselves and each other to         the employee contributions of our
clearly articulates what great            the highest standards and ultimately     service providers. For example,
leadership looks like at Adelaide         defines how we are perceived             we have introduced the Security
Airport by detailing leadership           as a company.                            with Service Awards to recognise
imperatives and key actions for                                                    individuals employed by ISS
                                          We are proud of our diverse
each of the levels of leadership.                                                  who have made an outstanding
                                          workforce, with a team that
                                                                                   contribution to the success
                                          represent various cultures,
                                                                                   of this contract.
                                          generations and nationalities, as
                                          well as a strong gender equality
                                          philosophy. Diversity and inclusion
                                          for us spans age, gender, culture,
                                          experience (we have highly skilled
                                          graduate engineers to 80-year-
                                          old volunteer ‘ambassadors’),
                                          disabilities and the way we work
                                          and respect each other.

  38        ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
TOP HONOURS FOR
 EXCELLENCE IN HUMAN
RESOURCES MANAGEMENT
   IN THE ASIA PACIFIC
      REGION IN 2016

                                      Doubled
                                    investment
                                  in training and
                                   development
                                                        100%
                  Employee                           maternity
                engagement                          leave return
               score of 73.5%,                         to work
                up from 51%

                                                             Increased female
           Halved                PROGRESS OVER                 employment
           attrition              PAST 3 YEARS:                    by 5%
            rates

              Equal gender
               promotions
                 in 2015
OUR
COMMUNITY
Adelaide Airport’s partnership            Community investment initiatives         COMMUNITY CONSULTATION
approach to community                     in the past year include:
engagement and our community                                                       The future growth of our business,
investment goes beyond individual         • Royal Flying Doctor Service –          and of the State, will continue to be
events and activities. As an inner          supporting a dental health access      compatible with surrounding land
metropolitan airport, we are in an          program for remote areas;              uses through ongoing consultation
enviable position where we can                                                     with local stakeholders.
                                          • Surf Life Saving SA – purchase of
build strong community values and           Inflatable Rescue Boats;               Adelaide and Parafield Airports
influence future sustainability.                                                   both engage formally and informally
                                          • Power Community Ltd –
Our Community Investment                                                           with the community through a
                                            sponsoring the Empowering Youth
Strategy is making a difference to                                                 comprehensive consultation and
                                            Program;
the lives of people connected to                                                   communications program.
the organisations we support, and         • SA Living Artists Festival – hosting
                                                                                   We conduct quarterly meetings
in particular our employees are             the ‘Great Southern Land’
                                                                                   of the airports’ consultative
involved and personally invested in         exhibition in the terminal;
                                                                                   committees and actively participate
a multitude of community initiatives      • Brighton Jetty Classic Sculptures      in presentations and engagement
and events.                                 Exhibition – major partner;            with community service clubs.
We’re connecting with our                                                          Our printed newsletter ‘Plane
                                          • Adelaide Festival – presenting
customers in the community                                                         Talk’ is circulated locally and we
                                            partner;
through strong partnerships.                                                       also use our website and social
Adelaide Airport has developed a          • Adelaide Youth Orchestras –            media channels to reach interested
partnership approach to community           social inclusion partner; and          individuals and organisations.
engagement and our community              • Art Gallery of South Australia –       Open and productive relationships
investment. This aims to, among             gallery partner.                       with key stakeholders across
other things, encourage a culture                                                  industry and government foster
of social inclusion and diversity,        Our employees are involved and
                                                                                   productive outcomes for the State.
lead a culture of sustainability          personally invested in a multitude
                                                                                   For example, at Adelaide Airport,
and enhance South Australia’s             of community initiatives and
                                                                                   collaboration and coordination
reputation as a business centre and       events, including:
                                                                                   between the airport and State
travel destination within the Asia                                                 Government is critical for securing
Pacific region.                           • Adelaide Fringe – taking part in
                                            the Opening Parade;                    new international airline capacity,
Adelaide Airport’s Community                                                       as has been demonstrated in
Investment Strategy seeks to              • Power Community Ltd - visit to         recent years.
create tangible benefits across             the RAAF Edinburgh base as
                                            part of the Empowering Youth           The relationship and cooperation
the environment, disability sector,                                                with our landlord and regulator,
arts, sport and charitable partners,        Program;
                                                                                   the Commonwealth Department
whether it be financial assistance,       • Surfing SA - voluntary                 of Infrastructure and Regional
in kind support or even volunteering        participation in teaching people       Development, is required for our
by our own employees. Our role              with disabilities to surf;             current operations and future plans.
stretches from local community
groups through to broader impacts         • Friends of the Patawalonga –           Other relationships with
across the Asia Pacific region.             volunteering for tree planting days    stakeholders include Federal,
                                            within the Patawalonga Creek           State and local governments, our
                                            catchment, as well as supporting       customers, on-airport tenants
                                            local organisations and schools;       including retailers, airlines, and AAL
                                            and                                    shareholders. Local businesses,
                                          • Tauondi College – Indigenous           residents, employers, exporters,
                                            IT and Business Administration         importers, tourism operators and
                                            students spend time with our staff     the wider community also rely on a
                                            on airport.                            successful airport business.

   40       ADELAIDE AIRPORT LIMITED: ANNUAL REPORT 15/16
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