Hong Kong Airport dividend payout of HK$5.3 billion raises eyebrows
Operator paid record sum to the government, even as it struggles to find cash for new runway likely to be city's costliest infrastructure project
Questions have arisen over the Airport Authority's dividend policy after it paid a record HK$5.3 billion to its sole shareholder, the Hong Kong government.
The generous dividend comes as the airport operator struggles to formulate a financing plan for a multibillion-dollar runway expansion that it has been advocating.
Compared with last year's payout, the sum represents a rise of 20.5 per cent - a higher rate than the 14 per cent net profit growth to HK$6.4 billion the authority reported yesterday.
With the latest dividend, the government has pocketed about HK$29 billion since 2003, the year it started recouping its capital injection of HK$36.6 billion into the authority that put Chek Lap Kok airport into operation in 1998.
Stanley Hui Hon-chung, the authority's outgoing chief executive, sidestepped questions on whether the payout should be lowered in order to strengthen the operator's finances.
"It is a decision of the authority's board," Hui said, referring to the 17-member governing organ on which the highest-ranking government official is Secretary for Transport and Housing Professor Anthony Cheung Bing-leung.
The authority said the financing plan for the third airport runway would not be ready before the end of the year.
But the project is expected to cost more than the HK$130 billion estimated in 2011, and may become the city's most expensive infrastructure project ever.
Even before construction began, more than HK$600 million has been spent in the past two years on consultancies and environmental impact studies for the project.
Joe Ng Cho-hin, vice-chairman of the Board of Airline Representatives, asked if the authority should continue with such a big dividend in the face of huge infrastructure investment ahead.
"We are concerned if the authority, as a government-owned entity, should earn as much as that," Ng said. He questioned the necessity of the big dividend payout, saying such lavish disbursement would "indirectly increase the burden on the airlines and passengers".
Hui was non-committal over whether to raise fees, saying only that the share of airport charges - mainly in airlines' payments for parking, landing and terminal building - in the authority's revenue stream would be steady.
The authority attributed its strong performance to 6.1 per cent growth in passengers to 60 million and a 6.3 per cent increase in aircraft movements to more than 370,000 last year.
Revenue from retail concessions and advertising registered 23 per cent growth year on year to HK$6.1 billion, and remained the largest single source of income.