The Queenstown Lakes District Council has considered a dividend policy from the Queenstown Airport Corporation that will act as a guide to Queenstown Airport shareholders on the expected cash returns to the community in the future, QLDC general manager regulatory and corporate services Roger Taylor said.

The policy was considered at a meeting of Full Council on 17 May, 2011.

“On an annual basis the directors must consider whether to pay a dividend or not,” he said.
The Council undertook a comparative study of other similar entities to check that the proposal from QAC was reasonable.

Auckland International Airport Limited, as a 24.99% shareholder in the airport, would receive its proportional share of any dividend, together with the remaining shareholder QLDC. The Council would receive 75.1% of the dividend and Auckland International Airport Limited, 24.99%.

“We looked at other organisations and found that the QAC had the ability to pay a dividend but understand they would like to take a prudent approach and this policy is conservative,” Mr Taylor said.

The policy proposes a mix of fixed variable components beginning with a $2 million base and a potential “top-up” dependent on performance. It also allowed for special dividends in the future.

The policy precluded the board from issuing shares in lieu of dividends without the approval of shareholders ie Auckland International Airport and the QLDC.

The Council approved the policy which would now be included in the QAC Statement of Intent.

“The next step will involve a workshop around options and issues around what Council should do with the dividend,’ Mr Taylor said.

ENDS
For further information please contact Roger Taylor 03 441 0499.

>>Download the Draft QAC Dividend Policy here 

By: Andrea Bunting