Melbourne Airport

APAC ANNUAL REPORT 2012 NEXTAUSTRALIAPACIFICAIRPORTSCORPORATION ANNUAL REPORT 2013 1

About APAC Australia Pacific Airports Corporation Limited (APAC) operates two key Australian aviation assets, Melbourne Airport and Launceston Airport. APAC acquired the lease for Melbourne Airport in July 1997. The Launceston Airport lease was acquired shortly after (May 1998) in partnership with the Launceston City Council. Both airports are operated under a 50 year long-term lease from the Federal Government, with an option for a further 49 years. APAC has demonstrated consistent growth since its inception in 1997. Strong management and diverse revenue streams continue to enable APAC to capitalise on opportunities and deliver aviation excellence. Ownership APAC is a privately held corporation owned by institutional investors, predominantly superannuation/pension funds, managed or represented by the following five entities: AMP 28.54% IFM Investors 23.67% Deutsche Australia Ltd 19.97% Future Fund 19.12% Hastings Funds Management 8.70%Australia Pacific Airports Corporation LtdABN 89 069 775 266

APAC ANNUAL REPORT 2012PURPOSE To responsibly develop a growing andprofitable airport group in the Asia Pacific region.OBJECTIVE To be the most successful airport group inthe Asia Pacific region. CoNTENTS4 Highlights 20136 Chairman’s Message7 CEO’s Message8 Board of Directors10 Executive leadership team12 Growing the Business16 Service18 Our Reputation22 Our Team24 Results Summary25 Financial StatementsAUSTRALIAPACIFICAIRPORTSCORPORATION ANNUAL REPORT 2013 3

HIGHLIGHTS Total revenue: $642M ↑9% Operating profit: $470M ↑8% Net profit: $202M ↑19% Capital expenditure: $254M ↑22%4 APAC ANNUAL REPORT 2013 *All statistics = millions

MILESTONE 100 millionth international passengerMILESTONE Melbourne became Australia’s largest exporter of air freightMILESTONE More than $100M invested in Melbourne’s business parkMelbourne passengers: 29.9M ↑6%Launceston passengers: 1.22M ↑8%Melbourne international passengers: 7.1M ↑5%Melbourne international SEAT capacity ↑5% APAC ANNUAL REPORT 2013 5

CHAIRMAN’S MESSAGEAirports connect people and businesses Melbourne’s curfew free operations I am confident that through ongoingto the world and they are also significant continue to drive growth. Every year, consultation, forward planning andcontributors to the economic, social Melbourne’s curfew free status allows responsible operation we will successfullyand cultural well-being of the regions the movement of an additional two million deliver these important projects thatthey serve. passengers and adds $590 million to will support the growth of the airports, the Victorian economy through visitor our businesses, and our communitiesAt Australia Pacific Airports Corporation, spending every year. into the future.(APAC) we strive to responsibly developgrowing and profitable airports. APAC’s international services include a To the teams at Melbourne and growing number of direct flights to key Launceston airports, as well as to ourTo achieve this objective, our airports markets in Asia. While China remains a customers, service providers, contractorsfacilitate the safe and successful significant driver of growth in the region, and stakeholders – thank you for yourmovement of tens of millions of people other markets such as India, Hong Kong hard work and support in achieving theand hundreds of thousands of aircraft and Taiwan also offer great potential. results of the past year, and we lookmovements every year. As the demand forward to continuing the journey with youfor air travel in Australia grows, we will In this context, it is essential that we in the year ahead and beyond.continue to provide the access and continue to negotiate more capacity forinfrastructure necessary to support that air services between Australia and these David Crawford AOincreasing demand. markets which are continuing to grow.This annual report highlights what we do As many of you who travel throughtoday and also outlines the significant our airports know, they are undergoingactivities we have planned for the future. constant renewal as we upgrade our facilities and invest in new infrastructure.Every year, Melbourne Airport contributes In Melbourne particularly, the tempo has$1.4 billion to Victoria’s Gross State quickened over the past year, and willProduct (GSP) and directly supports more continue to gather pace in the years ahead.than 14,000 jobs. We have been busy on our airfields, in ourIn Melbourne, we celebrated the 100 terminal buildings, and on our landside roads.millionth international passenger to travelthrough Melbourne Airport as research Our total capital expenditure over the pastshowed that every international flight year was $254 million – a 22% increase onlanding in Melbourne injects $240,000 the previous year. It was the highest annualinto Victoria’s economy. capital expenditure over the past decade, however there is much more to come.We are also a significant gateway fortrade. Our capital expenditure in the coming year is forecast to be approximately half aThis year, Melbourne overtook Sydney billion dollars as we undertake upgrades atas the leading airport for air freight Launceston and we embark on the largestexports accounting for almost 40 per transformation of Melbourne Airport sincecent of Australia’s total air freight exports. it opened more than 40 years ago.Melbourne is the freight gateway forVictoria as well as Tasmania, South These are exciting times as we transformAustralia and southern New South Wales. our airports to continue to serve the needs of Melbourne and Launceston for theThis achievement is testament to the decades ahead.success of our farmers and manufacturersin winning new markets and is also They will also be challenging times, assupported by the growing number of major construction projects are deliveredinternational services and destinations that at operating airports, including Melbourneare now directly connected to Melbourne. which is open 24 hours a day.6 APAACPANCNAUNANLURAELPROERPTO2R0T123012

HOMECEO’S MESSAGEThis year was a milestone year for There are a number of external factors We also continued planning for the futureAPAC as we laid the foundations for that influence our performance. Bilateral with the development of Melbourne’sthe largest transformation at Melbourne air service agreements are the lifeblood of Master Plan. Submitted to the FederalAirport since it opened more than forty international aviation, and the Government Government for approval, the Master Planyears ago. We have started planning and and its agencies must negotiate more outlines our vision for Melbourne focusingdelivering projects in both Melbourne capacity in these agreements so that we on two key projects, the elevated loopand Launceston to meet the growing can all realise the opportunities for growth road network the and third runway. Ourdemand for aviation services in Victoria in our key Asian markets. consultation process has seen robustand Tasmania for the years and engagement with the community, whichdecades ahead. This year Melbourne overtook Sydney we will continue as we progress through to become Australia’s largest air the approval process for both of theseIt was also another year of changes freight exporter, confirming Victoria critical projects.and challenges in the Australian aviation as Australia’s freight state. Driven byindustry with new brands, new people, growth in international passengers and As our construction program acceleratesnew ownership arrangements and underpinned by Melbourne’s curfew free in both Melbourne and Launceston,new alliances. operations, we are supporting Victoria’s so too does our focus on safety and vision of becoming Asia’s food bowl as security. I am pleased to report that inWe continued to improve our infrastructure regional Victoria, Tasmania and south-east Melbourne, 664,000 construction manand facilities as well as delivered the Australia are provided unprecedented hours were worked throughout the yearlevel of service expected by our airline access to critical export markets. without any lost time injuries. Providingcustomers, suppliers, stakeholders and a safe and secure environment for ourpassengers. Improving service to passengers, airlines, passengers, staff and visitors is one of the suppliers and stakeholders was a focus most important things we do and we willTotal passengers travelling through our throughout the year. We are seeing the continue to make this a priority.airports increased in 2012/13 to more results of that focus with Melbournethan 31 million due to increases of 6 per the first airport to be accredited to an Our airports are critical pieces of nationalcent and 8 per cent at Melbourne and International Customer Service Standard. infrastructure and they are also economicLaunceston respectively. We will continue to look at innovative ways and employment hubs that support the to improve service, including through the economic, social and cultural well-being ofAt Melbourne, international passengers introduction of new technology. their respective states.grew by 5 per cent. These results weredriven by growth in Chinese passengers We continued to deliver on key expansion Together with our airline customersand included other Asian growth markets projects throughout the year. and service providers, our capable andsuch as Taiwan, Malaysia, Hong Kong committed teams at Melbourne andand Vietnam. In Melbourne, ground access remains Launceston support the safe facilitation an area of concern and to address of more than 30 million passengers andWe celebrated the milestone of this, we redeveloped one of the most 215,000 aircraft movement every year.Melbourne’s 100 millionth international congested and keenly contested areas inpassenger this year, and fittingly, the the precinct, the main terminal forecourt, On behalf of the APAC Board, I thank mydestination of that passenger was Asia. as well as undertook significant road team for their ongoing commitment andNew Zealand however remains our largest upgrades and expansions. efforts to support APAC, as well as theirsource of international passengers. respective states of Victoria and Tasmania With 60 million passengers forecast to which they so ably represent.The demand for travel is being well met travel through Melbourne by 2030, a railby our airline customers. We warmly link is a priority and we will continue to Chris Woodruffwelcomed Sichuan Airlines to Melbourne, work with the State Government and itsas they launched direct flights between agencies to progress this. It is howeverMelbourne and the western city of not the only access improvement neededChengdu. Emirates, Singapore Airlines to meet traffic demands so we will alsoand Jetstar expanded services and ten continue talking to the State Governmentmore airlines increased capacity on their about other opportunities, including theMelbourne routes. expansion of the Tullamarine Freeway. APAC ANNUAL REPORT 2013 7

APAC ANNUAL REPORT 2012BOARD OF DIRECTORSDavid Crawford AO Chris Woodruff Kyle ManginiChairman Managing Director DirectorAppointed 30 April 2012 Appointed 31 August 2007 Appointed 16 October 2009Mr Crawford is also the Chairman of Lend Mr Woodruff is Chief Executive Officer and Mr Mangini is Head of Infrastructure andLease Corporation Limited, a Director of BHP Managing Director of Melbourne Airport and Specialised Funds at IFM.Billiton Limited, and a Member of Advisory Launceston Airport.Boards for Allens, Evans & Partners Pty Ltd,and Bank of America Merrill Lynch.John Harvey Richard HedleyDirector DirectorAppointed 2 May 2011 Appointed 16 June 2008Resigned 15 February 2013 Resigned 30 August 2010Reappointed 25 March 2013 Re-appointed 2 May 2011Mr Harvey is an independent Director appointed Mr Hedley is a Director of Deutsche Asset &by IFM Investors. Mr Harvey is a professional Wealth Management.director having served on a number of publicand private company boards.88 APAACPANCNAUNANLURAELPROERPTO2R0T123012

AHPOAMCEANNUAL REPORT 2012Mar Beltran Bryan Hynes Nadine LennieDirector Director DirectorAppointed 27 August 2012 Appointed 21 June 2013 Appointed 20 January 2011Ms Beltram is a Portfolio Manager at AMP Mr Hynes is the Managing Director of AMP Ms Lennie is a Director of Infrastructure andCapital. Capital Shopping Centres. Timberland at the Future Fund.Secretary RESIGNEDLisa Evans Andrew Fellowes Paul BreenGeneral Counsel and Company Director DirectorSecretary Appointed 7 April 2011 Appointed 6 July 2011Appointed 27 April 2009 Resigned 13 March 2013 Resigned 22 May 2013Ms Evans is APAC’s General Counsel. APAC ANNUAL REPORT 2013 99

EXECUTIVELEADERSHIP TEAMChris Woodruff Adam Watson Lisa EvansChief Executive Officer & Chief Financial OfficerManaging Director General Counsel Mr Watson joined APAC in October 2012 & Company SecretaryMr Woodruff joined APAC in 2007. He has held following a career with BlueScope Steel Limiteda number of senior management positions where he held a number of senior executive Ms Evans joined APAC in 2009. Previous roleswithin BAA at Heathrow, Gatwick and Budapest roles within Australia and the United States. include Senior Legal Counsel at Symbion Healthairports. Mr Woodruff is also on the Board of Prior to joining BlueScope, Mr Watson held Ltd (formerly Mayne Group), following 10 yearsthe Melbourne Convention & Visitors Bureau. various senior roles at Spotless Group Limited. in private practice in Australia and New Zealand.Nathan Agnew Simon Gandy Colleen NewsomeExecutive General Manager, Executive General Manager,Corporate & Aeronautical Executive General Manager, People & PerformanceDevelopment Melbourne Airport Group Ms Newsome has been responsible for APAC’sMr Agnew joined APAC in 2009. Mr Agnew has Mr Gandy joined APAC in 2007. Mr Gandy organisational design and people capabilitiesalso held senior roles within Air New Zealand previously held a number of senior leadership for 14 years and has been with APAC foras well as senior advisory roles at Qantas, roles within BAA at both Heathrow and more than 15 years. Ms Newsome is alsoAnsett and Air New Zealand. Mr Agnew has Gatwick airports. responsible for APAC’s occupational health,also advised Rio Tinto and Woodside on capital safety and environmental performance.expansion planning.10 APAACPANCNAUNANLURAELPROERPTO2R0T123012

HOMEDaniel Cappell Carly Dixon Pamela GrahamGeneral Manager, Retail General Manager, Corporate& Car Parks & Public Affairs General Manager, Launceston AirportAppointed 1 July, 2013 Appointed 6 August, 2013 Ms Graham has more than 29 years’Prior to joining APAC, Mr Cappell held senior Ms Dixon has over 12 years’ experience experience in aviation beginning at Perthroles at Abu Dhabi Airports Company in retail in public affairs, communications and policy Airport before transferring to Melbourne inand commercial development. Prior to joining roles within the public and private sectors. 1987. Integral to the transfer of ownershipAbu Dhabi Airports Company, Mr Capell spent Ms Dixon has worked as a policy advisor from the Federal Airports Corporation to APAC,22 years with Nestle SA including managing to Victorian State Parliamentarians and Ms Graham is currently Chairman of BusinessNestle’s global travel retail business. Commonwealth Cabinet Ministers. Events Tasmania Board, and a Director of Launceston Chamber of Commerce, and the Tourism Industry Council of Tasmania.APAC ANNUAL REPORT 2013Linc Horton Bryan ThompsonGeneral Manager, Property General Manager, Strategy,Mr Horton joined APAC in 2008 and Planning & Developmenthas over 16 years’ experience in propertyand investment. Prior to joining APAC, Mr Thompson joined APAC in 2010. HisMr Horton held senior roles with BAA Lynton previous experience includes variousand Threadneedle Property Investment. operational and planning roles in some of the world’s largest and most challenging airport operating environments including Mumbai International Airport and Johannesburg International Airport. APAC ANNUAL REPORT 2013 11

GROWING THE BUSINESSAviation continued to be a dynamic industrywith the year delivering new brands, newpeople, new ownership arrangementsand new alliances. The year was also amilestone as Melbourne Airport laid thefoundations for its biggest transformationsince it opened more than 40 years ago.Growing CapacityKey achievements for the 2012/13 year include:MEelLbBoOurUnReNE > Additional services or uinpcgreradsed Launceston frequencies introduced during the year> Total passengers grew by 6 per cent to > Total passengers grew by 8 per cent reach 29.9 million. included: to reach a record annual total of 1.22 million passengers.> International passengers grew by 5 per - A daily A3800 EEmmiirraatteesssseerrvviciceebetween cent to reach 7.1 million. bMeetlwboeuernnMe,eDlbuobuarinaen,dDAuubcaki land. > Jetstar and Qantas introduced additional services to and from> Melbourne celebrated its 100 millionth - AAufcokulrathndd.aily Singapore Airlines Launceston over the summer period, international passenger - AsefrovuicrethbdeatwilyeSeningMaeplbooreurAnierlinaensd supporting strong passenger growth.> The Asia-Pacific region continued to sSeinrvgiacpeobret.ween Melbourne and > Sharp Airlines relocated to a new lead international passenger growth - SDiinregcatpSoirceh.uan Airlines services terminal facility, and also introduced a with the key markets of China, Taiwan, - bDeirtewcet eSnicMhuealbnoAuirrnlineeasnsdeCrvhiceensgdu, new service to King and Flinders Islands Hong Kong, Vietnam and India all in July. growing by more than 10 per cent. bonetewoefeWn eMsetelbrnouCrnheina’nsdfaCshteesntgdu, ognroewoinf gWreesgtieornnsC. hina’s fastest> New Zealand remained Melbourne’s - gDriorewcitnJgertesgtaior nsse.rvices to Honolulu. largest source of international -- IDnicrerecat sJeedtsctaarpsaecrivtyicbeys 1to0 Hoothneorlulu. passengers. - Iintcerrenaasteiodncaal apiarlciniteysbinyc1lu0dminogreQantas, iAnitreNrneawtioZneaallanirldin,eVsirignicnluAduinstgraQlia,ntas,> International airlines supported the ACihr iNnaewEaZsetearlannadn,dVirgin Australia, growth of Melbourne with a 5 per cent China ESaosuttehrenrna.nd increase in international seat capacity. China Southern.12 APAACPANCNAUNANLURAELPROERPTO2R0T123012

HOMEAviation continued to be a dynamicindustry with the year delivering newbrands, new people, new ownershiparrangements and new alliances.The year was also a milestoneas Melbourne Airport laid thefoundations for its biggesttransformation since it openedmore than 40 years ago.APAC ANNUAL REPORT 2013 13

GROWING THE BUSINESSGrowing InfrastructureKey infrastructure projects completed or commenced during 2012/13 include:> Terminal 3 refurbishment – in > New long term car park – a new entry Access partnership with Virgin Australia, and from Mercer Drive into Melbourne’s completed on time and on budget, the long term car park improved utilisation As Melbourne continues to grow, access refurbished Terminal 3 now aligns with and traffic flow. A new long term car to and around the airport is an increasingly Virgin Australia’s refreshed branding. park, the Value Stay Car Park, was also important issue. Significant road upgrade developed for use in peak periods. and expansion projects include:> Forecourt – successful redevelopment of one of Melbourne’s most congested > Launceston successfully expanded > Extension of Francis Briggs Road – and keenly contested areas, improving capacity of its southern apron, to improve traffic flow around the long traffic flow and delivering more quadrupling the load factor. term car park and taxi holding area. space for general public pick-up bays and streamlined bus services > Southern Precinct Program – the > Extension of Airside Road – extended through the relocation of commercial Federal Government approved the to cater for relocation of airside services and public services. major development plan (MDP) gate and new domestic terminal works for this significant program of> Foxtrot apron infill project – this project, work. Approved works include a new > Airport Drive – extensive planning was scheduled for completion late in 2013, domestic terminal, ground transport undertaken on this major project that, will deliver approximately 30,000m2 of hub, additional aircraft parking bays and when completed, will provide direct new aircraft parking at Melbourne. significant road improvements. access to the M80 Western Ring Road. It also includes provision for a rail link.> Taxiway slab replacement – to maintain safety standards, > Terminal Drive – doubled capacity of Melbourne is replacing approximately this major arterial road by adding two 68,000m2 of aged concrete on its new lanes. The intersection with Centre taxiways. The project will take five years Road will also be expanded to improve to complete. traffic flow into the main forecourt area.14 APAACPANCNAUNANLURAELPROERPTO2R0T123012

HOME To support the continuing demand for aviation services as well as the growth of Victoria and Tasmania, APAC invested $245 million in a targeted program of facility upgrades and expansions.Business park Freight Planning for the futureMelbourne’s business park achieved In January 2013, Melbourne Airport > Work progressed on Melbourne’s Masterstrong growth with more than $100 became Australia’s largest exporter of air Plan supported by a broad stakeholdermillion invested to support the operations freight during the year, confirming Victoria engagement program includingof freight and business park partners. as the premier freight state. government and the local community.Significant developments include: > Air freight exports increased by > Major projects within the Master Plan> New facilities – completion of new 16 per cent. include a proposed third runway and facilities for Border Express Pty Ltd a long term road solution, the elevated and Fellowes. > With 85 per cent of freight carried in loop road. passenger aircraft, increased international> Airservices’ Hot Fire Training Ground – passenger services to key growth > In November 2012, Melbourne successful completion of the largest markets such as Asia and the Middle announced east-west as the preferred hot fire training ground in the southern East supported growth in freight exports orientation for the proposed third runway. hemisphere. > Major freight categories by value > Extensive consultation with the> Essendon Football Club – were medical products, fish and community was undertaken and commenced training on new grounds crustaceans, fresh meat and precious included public meetings and located at Melbourne. stones and metals. attendance at local shopping centres. The draft preliminary Master Plan was> Melbourne Airport Cargo Centre – > Freight services are supported by also available for public comment for successfully completed stage one of Melbourne’s curfew free operations. 60 business days. this major development that supports growth of freight related business. > The Master Plan has been submitted to Leading global companies The the Federal Government for approval. Panalpina Group and ABR Aviation Services also signed as tenants. APAC ANNUAL REPORT 2013 15

ServiceQuality of Service Customer TechnologyMonitoring (QSM) service Technology is playing an increasingly> Accreditation was gained for the new > Melbourne further strengthened its important role in delivering great customer market research standard ISO 20252. service commitment with five out of service across APAC’s operations. the six key customer service indicators> Service levels improved at Melbourne increasing throughout the year. > Self-service kiosks – part of a wider with overall airport experience for the program to streamline the passenger international terminal increasing to > Melbourne became the first airport experience, and in conjunction with 4.15 out of 5. in the world to gain accreditation to Air New Zealand, self-service kiosks the International Customer Service and automatic bag drops were> More than 14,000 passengers were Standard 2010-2014. successfully introduced in Melbourne’s interviewed in Terminals 2, 3 and 4. international terminal. > Melbourne’s six key indicators are ambience, cleaning, crowding, > SmartGate – in close collaboration information and way-finding, facility with Customs, additional SmartGate availability, and courtesy and technology was installed in Melbourne’s helpfulness. international arrivals area. > Melbourne and Launceston will > Car parking online – an online booking continue to work to improve the level facility was introduced at Melbourne of service delivered that enables customers to pre-book and pre-pay for car parking.16 APAACPANCNAUNANLURAELPROERPTO2R0T12012

HOMEA spotlight on service has deliveredimproved passenger satisfaction in 2012/13.Focus on Asia Customer service awardsThe emphasis on key growth marketsremains at Melbourne as the focus The Melbourne Airport Customer Servicemoved from being ‘China ready’ to ‘China Awards were introduced to recognise thefriendly’. Initiatives introduced during the number of organisations that contributeyear included: to APAC’s daily operations and success.> Additional Mandarin speaking Inaugural winners were announced staff appointed as part of the volunteer at an awards ceremony with more Customer Care program. than two hundred APAC staff and nominees attending.> Public announcements in Mandarin at Melbourne’s international departures international screening point to provide real time updates and further guide passengers.> Further cultural training for APAC and front line staff.> Mandarin classes for APAC staff. APAC ANNUAL REPORT 2013 17

Our reputationAPAC is committed to delivering responsibleairport operations that protect and enhancethe environments and communities in whichthey operate.Stakeholder Environment > Launceston – successfully replacedand community all lighting on its roads and within theengagement > Environmental management system – short term car park with more efficient recertification of Melbourne Airport’s and sustainable LED lighting.> Stakeholder audit – every year a Environmental Management System comprehensive and in-depth audit (EMS0 to ISO14001) with zero non- > Stakeholder engagement – is conducted with some of Melbourne’s conformances. Melbourne continued to work key stakeholders with Melbourne with government, businesses, the achieving 95 per cent and 92.5 per > Climate Friendly – working with Climate community and key stakeholders cent for quality of relationships and Friendly, all staff flights and vehicles, through the important Noise communications respectively. including the car park bus fleet for the Abatement Committee. 12/13 year were offset across APAC.> Stakeholder consultation – Melbourne and Launceston’s Community Aviation > Revitalising Maribyrnong River – Consultation Groups (CACG) continued Melbourne continued working with the with their program of regular public Victorian state government, industry meetings. In Melbourne, attendance bodies and local landowners to improve at the forum grew significantly as the pest, plant and animal control, on the Master Plan and future developments largest ever collaborative environmental became key discussions points. project in Victoria. > Tri-generation project – work commenced on a more secure and flexible power source in Melbourne that will reduce Melbourne Airport’s annual carbon emissions by approximately one third.18 APAACPANCNAUNANLURAELPROERPTO2R0T123012

HOMESocial andeconomic impactTo inform the development of MelbourneAirport’s Master Plan, research andanalysis was undertaken by anindependent research company.Key findings include:> Melbourne Airport is a major centre of employment, directly supporting 14,300 roles and indirectly supporting 43,000 roles.> Melbourne Airport contributes $1.47 billion to Victoria’s gross state product (GSP).> Every international flight that lands at Melbourne contributes $240,000 in visitor spending to Victoria’s economy.> Every year, Melbourne’s curfew free status allows for the movement of an additional two million passengers and adds $590 million to the Victorian economy through visitor spending. 19APAC ANNUAL REPORT 2013

Our reputation APAC is committed to delivering responsible airport operations that protect and enhance the environments and communities in which it operates.Government Safety SecurityBoth Melbourne and Launceston Safety is a priority every day at APAC. As > Secure operations – APAC deliveredcontinued to work with all levels of the construction program intensifies, the safe and secure airport environmentsGovernment to continue to improve need to continue working safely is critical. with no major incidents that adverselyplanning operations and services. impacted operations. > Safety Management System (SMS) –> Melbourne continued to work aims to ensure compliance with > Body scanners – as part of the with the Victorian State Government all current work health and safety Federal Government’s initiative to on improving taxi services following legislation and safety system improve security, Melbourne installed the final report of the Professor Fels requirements. body scanning equipment in the led inquiry. international departures area. > Construction – in Melbourne, 664,000> Melbourne contributed to the construction hours were completed > Stakeholder engagement – Victorian government’s review of the with zero lost time injuries (LTIs). APAC will continue to work with the Metropolitan Planning Scheme. government to enhance security > AS4801 – following accreditation of across its operations.> Launceston contributed to The the new Australia safety management Tasmanian Access Study with the system AS4801 last year, internal Tasmanian State Government committing processes were strengthened to additional tourism marketing funding to support the new safety framework. promote greater use of airline services. > Stakeholder engagement – APAC> Melbourne continues to work with key will continue to work closely with government departments, industry government, safety regulators and bodies, business and stakeholders contractors to maintain a safe working through a number of formal forums environment. including The Melbourne Airport Transport Committee, The Planning Consultation Forum, and the Melbourne Airport Business Partners Forum.20 APAACPANCNAUNANLURAELPROERPTO2R0T123012

HOMESupporting our communitiesAPAC supports a number of community > Western Bulldogs Football Club – > Hume Council – as a major centre ofand industry organisations to further Melbourne worked with the club to employment for the north-west anddevelop and enhance the economic and support international students from working closely with Hume Council,social prosperity of the communities in the north-west region with skills Melbourne introduced a centralisedwhich it operates. workshops and excursions for more career portal on the Melbourne Airport than 150 children. website to raise awareness around> Salvation Army asylum seeker airport related job opportunities. support – Melbourne’s support for > Conservation Volunteers – the service assisted more than 1,200 a new partnership which sees > Launceston continued its support for asylum seekers living in Melbourne’s Melbourne supporting the ‘Healthy the region’s prestigious Glover Art Prize, north-west. Support included medical Habitats’ conservation program at the Junction Arts Festival, the Blue Sky treatment, clothing, school uniforms Woodlands Park works to establish Ball and the Launceston Tornadoes and books. new populations of Victoria’s most Basketball team. endangered mammal, the Eastern> Western Chances – Melbourne’s Barred Bandicoot. ongoing support of Western Chances assisted to provide more than 400 > Destination Melbourne – Melbourne scholarships to talented young people continued to support the Melbourne experiencing financial hardship. Tourism Industry Leadership Program which aims to strengthen succession> Essendon Football Club – Melbourne management within the tourism sector worked with the Essendon Football while also providing practical learning Club support junior players from the opportunities for industry leaders. U14 teams. APAC ANNUAL REPORT 2013 21

Our teamAs major infrastructure assets, APAC’s > The Aviators – successful developmentoperations are critical to the growth of and implementation of an employeethe Victorian and Tasmanian economies. recognition initiative that supportsA passenger departing or arriving at collaboration across APAC.Melbourne or Launceston airports hascontact with many organisations, all > Health and well-being program –of which play an integral role in daily the successful program continuedoperations. with initiatives including yoga classes, massages and influenza vaccines.> APAC’s operations were supported by 283 staff.> A 76 per cent response rate to the employee enjoyment survey reinforced the team’s commitment to delivering world class operations and service.> Employee exchange – Melbourne hosted representatives from Chengdu Airport and China Southern Airlines as part of Melbourne Airport’s inaugural staff exchange program.> Women’s luncheon – focussing on development of female colleagues, Melbourne’s inaugural luncheon was held with inspirational guest speakers sharing experiences and expertise.22 APAACPANCNAUNANLURAELPROERPTO2R0T123012

HOMEA 76 per cent response rate in theemployee engagement survey reinforcedthe team’s commitment to deliveringworld class operations and service.APAC ANNUAL REPORT 2013 23

RESURLETSSUSLTUSMSMUAMRYMARY Financial Results for the financial year ended 30 June 2013 ($ millions) Year 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 % change Financial results - APAC 101 126 144 149 162 192 202 218 237 248 286 15% Areonautical 92 106 123 138 158 187 196 218 239 248 257 4% Retail & car parks 48 52 54 59 62 69 77 80 83 91 98 8% Property 2 2 2 2 2 1 1 2 2 2 2 0% Interest & other Total Revenue 243 286 323 348 384 449 476 518 561 589 642 9% Operating expenses 74 83 93 102 114 115 124 131 138 152 172 13% 169 203 230 246 270 334 352 387 423 437 470 8% Operating profit 0 0 0 91 77 22 (33) 11 59 17 44 159% Change in fair value of investment property 169 203 230 337 347 356 319 398 432 454 514 13% 40 45 38 34 37 39 46 53 65 75 84 12% Profit before borrowing 97 90 80 80 84 90 96 115 126 136 141 4% costs, depreciation and 32 68 112 223 226 227 177 230 291 243 289 19% amortisation 13 27 33 67 68 68 53 69 88 73 87 19% 19 41 79 156 158 159 124 161 203 170 202 19% Depreciation and amortisation Borrowing costs Profit / (loss) before tax Tax expense / (benefit) Net profit / (loss) Capital expenditure - property, plant and equipment & investment property Melbourne 42 38 108 77 89 128 201 156 147 205 249 21% Launceston 0 0 1 1 1 4 16 5 4 4 5 25% Total 42 39 108 78 90 132 217 161 151 209 254 22% Passenger volumes Melbourne Airport International 344 45556677 3% 7% Domestic 13 15 16 17 18 19 20 21 22 21 23 6% 0% Total (excluding transit passengers) 17 19 21 21 22 24 25 26 28 28 30 6% Transit passengers 000 00000000 8% Total (including transit passengers) 17 19 21 21 23 24 25 26 28 28 30 Launceston Airport 0.58 0.67 0.82 0.92 0.99 1.10 1.11 1.12 1.15 1.13 1.22 Domestic Aircraft movements (Thousands) Melbourne Airport 21 24 28 25 24 25 27 30 33 35 36 3% International 135 140 151 153 155 167 166 165 172 171 181 6% Domestic General aviation 2 1 1 1 1 2 1 1 1 1 1 1% Total 158 165 181 179 180 194 194 196 206 207 218 5% Launceston Airport Domestic 8 8 9 10 10 11 11 11 11 11 11 0% General aviation 7 7 6 6 5 6 6 7 7 7 7 0% Total 15 15 15 15 15 17 17 17 18 18 18 0% * figures are rounded to nearest million unless noted otherwise 24 Australia Pacific Airports Corporation Limited FINANCIAL REPORT 2013

Statement of Profit and Loss HOMEfor the financial year ended 30 June 2013 STATEMENT OF PROFIT AND LOSS Consolidated 2012 2013 $‘000 $‘000Operating revenue 285,627 247,954Aeronautical revenues 256,812 248,026Retail revenuesProperty revenues 97,984 90,610Interest and other revenues 1,980 2,251Total operating revenueNon-operating revenue 642,403 588,841Revenue from ordinary activities 100 85Less: operating costs 642,503 588,926Staff costsService and utilities 36,800 33,779Maintenance costs 95,080 82,118Administration, marketing and other 18,455 16,435Operating profit 21,695 19,557 470,473 437,037Add:Change in fair value of investment property 43,871 17,412Profit before borrowing costs, depreciation and amortisation 514,344 454,449Less: 84,054 74,933Depreciation and amortisation 141,364 136,767Borrowing costs 288,926 242,749Profit before income tax expense 86,915 73,026Less: 202,011 169,723Income tax expenseProfit for the yearAustralia Pacific Airports Corporation Limited FINANCIAL REPORT 2013 25

Statement of Financial Position Statement of Financial Position as at 30 June 2013 Consolidated 2012 2013 $‘000 $‘000 Current assets 3,854 3,047 Cash at bank 184 246 Inventories Receivables 43,365 32,461 Other financial assets 266 385 Total current assets 47,669 36,139 Non-current assets Property, plant and equipment 1,545,508 1,384,386 Investment property 1,085,917 1,009,782 Goodwill Other intangible assets 671,866 671,866 Other financial assets 1,772 - Total non-current assets Total assets 43,431 7,380 3,348,494 3,073,414 Current liabilities 3,396,163 3,109,553 Payables Borrowings 87,672 70,424 Current tax liabilities - 10,000 Provisions 10,936 Other financial liabilities 19,132 Total current liabilities 5,592 5,318 8,018 12,582 Non-current liabilities 109,260 Borrowings 120,414 Payables Deferred tax liabilities 2,025,173 1,901,152 Provisions 1,202 1,202 Other liabilities Total non-current liabilities 392,325 344,244 Total liabilities 1,520 1,275 Net assets 43,822 64,024 Equity 2,464,042 2,311,897 Issued capital 2,584,456 2,421,157 Reserves Retained earnings 811,707 688,396 Total equity 118,100 118,100 8,920 (60,832) 631,128 684,687 688,396 811,707 26 Australia Pacific Airports Corporation Limited FINANCIAL REPORT 2013

Statement of Cash Flows HOMEaSsuamt m30aJruyneo2f0K1e3y Notes to Financial Informationfor the financial year ended 30 June 2012 Statement of Cash Flows Consolidated Inflows (Outflows) 2013 2012 $‘000 $‘000Cash flows from operating activities 695,591 652,146Receipts from customers (233,694) (206,394)Payments to suppliers and employeesIncome tax paid (60,531) (52,413)Interest received 468 571Interest and other costs of finance paidNet cash provided by operating activities (146,553) (131,145) 255,281 262,765Cash flows from investing activitiesPayment for property, plant and equipment (205,017) (176,457)Proceeds from sale of property, plant and equipment 101 110Payment for investment propertyPayment for other intangible assets (49,369) (32,681)Net cash used in investing activities (2,211) -Cash Flows from financing activities (256,496) (209,028)Proceeds from borrowingsRepayment of borrowings 578,000 994,731Payment for debt issue costs (425,000) (891,000)Dividends paidNet cash provided by / (used in) financing activities (2,526) (3,800)Net increase / (decrease) in cash held (148,452) (141,720)Cash assets at the beginning of the financial year (41,789)Cash assets at the end of the financial year 2,022 807 11,948 (8,901) 3,047 3,854 3,047Australia Pacific Airports Corporation Limited FINANCIAL REPORT 2013 27

Summary of Key Notes Summary of Key Notes to Financial Information for the financial year ended 30 June 2013 1. Summary of key accounting by combining the financial statements of all the policies entities that comprise the consolidated entity, being the Company (the parent entity) and its subsidiaries Statement of compliance as defined in Accounting Standard AASB 127 Consolidated and Separate Financial Statements’. A The financial report is extracted from a general list of subsidiaries appears in Note 25 to the financial purpose financial report which has been prepared in statements. Consistent accounting policies are accordance with the Corporations Act, Accounting employed in the preparation and presentation of the Standards and Urgent Issues Group Interpretations consolidated financial statements. and complies with other requirements of the law. Accounting Standards include Australian equivalents The consolidated financial statements include the to International Financial Reporting Standards information and results of each controlled entity from (‘A-IFRS’). the date on which the Company obtains control and until such time as the Company ceases to control Compliance with the A-IFRS ensures that the such entity. consolidated financial statements and notes of the entity comply with International Financial Reporting In preparing the consolidated financial statements, Standards (‘IFRS’). all inter-company balances and transactions and unrealised profits arising within the consolidated entity The financial statements were authorised for issue by are eliminated in full. the directors on 26 August 2013 and can be obtained from the website listed in Note 27. (b) Property, plant and equipment Basis of preparation Property, plant and equipment are stated at cost less accumulated depreciation and impairment. The financial report has been prepared on the basis of historical cost. Cost is based on the fair values of the Assets acquired are recorded at the cost of consideration given in exchange for assets. Unless acquisition being the purchase consideration otherwise indicated all amounts are presented in determined as at the date of acquisition plus costs Australian dollars. incidental to the acquisition. Going concern Depreciation is provided on property, including buildings, plant and equipment, roads, runways and As at 30 June 2013, the consolidated entity has net other infrastructure but excluding land. Depreciation is current liabilities of $72,745,000 (2012: $73,121,000). calculated on a straight line basis so as to write off the The company has net current assets of $20,135,000 net cost of each asset over its expected useful life. (2012: $19,883,000). Despite the deficiency in net The following estimated useful lives are used in the current assets as at 30 June 2013, the Directors are calculation of depreciation: of the view that the group is a going concern due to the long history of profitability, unused finance facilities Buildings 10–40 years of $486,500,000 (2012: $239,500,000), forecast positive cash flows and the strong net asset position. Roads, runways and other infrastructure 13–80 years Rounding off of amounts Plant and equipment 3–15 years The Company is a company of the kind referred to in Land leased as part of the airport acquisition has ASIC Class Order 98/0100, dated 10 July 1998, and been valued at acquisition at fair value. The leased in accordance with that Class Order, amounts in the land is amortised on a straight line basis over the Directors’ Report and the Financial Report have been period of the leases, which are 99 years. rounded off to the nearest thousand dollars, unless otherwise indicated. (c) Income tax Significant accounting policies Current tax The following significant accounting policies have Current tax is calculated by reference to the amount been adopted in the preparation and presentation of of income taxes payable or recoverable in respect the financial report: of the taxable profit or tax loss for the period. It is calculated using tax rates and tax laws that have been (a) Principles of consolidation enacted or substantively enacted by reporting date. Current tax for current and prior periods is recognised The consolidated financial statements are prepared as a liability (or asset) to the extent that it is unpaid (or refundable). 28 Australia Pacific Airports Corporation Limited FINANCIAL REPORT 2013

HOME Summary of Key NotesSummary of Key Notes to Financial Informationfor the finaSncuiaml ymearreyndoefdK3e0yJuNnoet2e0s13to Financial Information for the financial year ended 30 June 2012Deferred tax ‘group allocation’ approach. Current tax liabilities and assets and deferred tax assets arising from unusedDeferred tax is accounted for using the tax losses and tax credits of the members of the tax-comprehensive balance sheet liability method consolidated group are recognised by APAC (as headin respect of temporary differences arising from entity in the tax-consolidated group).differences between carrying amount of assetsand liabilities in the financial statements and the (d) Impairment of assetscorresponding tax base of those items. At each reporting date, the consolidated entityIn principle, deferred tax liabilities are recognised for reviews the carrying amounts of its tangible andall taxable temporary differences. Deferred tax assets intangible assets to determine whether there isare recognised to the extent that it is probable that any indication that those assets have suffered ansufficient taxable amounts will be available against impairment loss. If any such indication exists, thewhich deductible temporary differences or unused recoverable amount of the asset is estimated in ordertax losses and tax offsets can be utilised. However, to determine the extent of the impairment loss (if any).deferred tax assets and liabilities are not recognised ifthe temporary differences giving rise to them arise from Recoverable amount is the higher of fair value lessthe initial recognition of assets and liabilities (other than costs to sell and value in use. In assessing value inas a result of a business combination) which affects use, the estimated future cash flows are discountedneither taxable income nor accounting profit. to their present value using a pre-tax discount rate that reflects current market assessments of the timeDeferred tax assets and liabilities are measured at the value of money and the risks specific to the asset fortax rates that are expected to apply to the period(s) which the estimates of future cash flows have notwhen the asset and liability giving rise to them are been adjusted.realised or settled, based on tax rates (and tax laws)that have been enacted or substantively enacted by If the recoverable amount of an asset (or cash-reporting date. The measurement of deferred tax generating unit) is estimated to be less than itsliabilities and assets reflects the tax consequences carrying amount, the carrying amount of the assetthat would follow from the manner in which the (cash-generating unit) is reduced to its recoverableCompany expects, at the reporting date, to recover or amount. An impairment loss is recognised in profit orsettle that carrying amount of its assets and liabilities. loss immediately, unless the relevant asset is carried at fair value, in which case the impairment loss isDeferred tax assets and liability are offset when they treated as a revaluation decrease.relate to income taxes leased by the same taxationauthority, and the Company intends to settle its Where an impairment loss subsequently reverses,current tax assets and liabilities on a net basis. the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of itsCurrent and deferred tax for the period recoverable amount, but only to the extent that the increased carrying amount does not exceed theCurrent and deferred tax is recognised as an expense carrying amount that would have been determinedor income in that income statement, except when it had no impairment loss been recognised for therelates to items credited or debited directly to equity, in asset (cash-generating unit) in prior years. A reversalwhich case the deferred tax is also recognised directly of an impairment loss is recognised in profit or lossin equity, or where it arises from the initial accounting immediately, unless the relevant asset is carried atfor a business combination, in which case it is taken to fair value in which case the reversal of the impairmentaccount in the determination of goodwill or excess. loss is treated as a revaluation increase.Tax consolidation (e) Investment PropertyThe Company and all its wholly-owned Australian Property held to earn rentals and/or for capitalresident entities are part of a tax consolidated group appreciation, is separately presented in the balanceunder Australian taxation law. Australia Pacific sheet as investment property. Investment property isAirports Corporation Limited (‘APAC’) is the head initially recorded at cost, including transaction costs.entity in the tax-consolidated group. Tax expense/ Subsequent to initial recognition, investment propertyrecovery, deferred tax liabilities and deferred is recorded at fair value. Gains or losses arising from atax assets arising from temporary differences of change in the fair value of this investment property arethe members of the tax consolidated group are recognised in the profit or loss for the period in whichrecognised in the separate financial statements of they arise.the members of the tax consolidated group using theAustralia Pacific Airports Corporation Limited FINANCIAL REPORT 2013 29

Summary of Key Notes Summary of Key Notes to Financial Information for the financial year ended 30 June 2013 Consolidated 2012 2013 $‘000 $‘000 2. Income tax recognised in profit 288,926 242,749 The prima facie income tax expense on pre-tax accounting profit 86,678 72,826 reconciles to the income tax expense in the financial statements as follows: 189 167 Profit from operations 48 33 Income tax expense calculated at 30% - - Permanent differences: Non deductible expenses 86,915 73,026 Non-deductible depreciation Under/(over) provision of income tax in previous year 43,365 32,461 Income tax expense 3. Current receivables Trade receivables 30 Australia Pacific Airports Corporation Limited FINANCIAL REPORT 2013

HOME BACK NEXTSummary of Key Notes to Financial Information Summary of Key Notesfor the financial year ended 30 June 2013 Consolidated Leasehold land Roads, runways Plant and Assets under Total and other equipment construction $‘000 $‘000 Buildings infrastructure $‘000 $‘000 $‘000 $‘0004. Property, plant and equipmentGross carrying amount – 67,362 586,304 784,555 369,265 105,802 1,913,288at cost - - - 228,249 228,249 (12,867)Balance at 30 June 2012 (596) (1,201) (11,070) -Additions - - - - - 17,105 -Disposals 47,872 61,422 37,876 (147,186) - 17,105 633,580 844,776Transfers (to) / from InvestmentProperty 16Transfers to / (from) assetsunder constructionBalance at 30 June 2013 84,483 396,071 186,865 2,145,775Accumulated depreciation/ 9,195 157,437 188,604 174,206 - 528,902amortisation 828 24,705 26,024 32,058 - 83,615Balance at 30 June 2012 - (401) (793) (11,056) - (12,050)Depreciation and amortisation - - - - --expense 10,023 181,741 213,295 195,208 - 600,267DisposalsTransfers to InvestmentPropertyBalance at 30 June 2013Net book value as at 74,460 451,839 631,481 200,863 186,865 1,545,50830 June 2013An independent valuation of certain assets was completed at 30 June 2012. Leasehold land, buildings, roadsand runways and other infrastructure were valued by Mr Gary Longden FAPI of the firm Jones Lang LaSalle.The valuation was based on depreciated replacement value. The Directors have adopted cost approach in theaccounts. If the valuation had been booked the carrying values would have been $150,800,000 for leaseholdland, $487,700,000 for buildings and $855,300,000 for roads, runways and infrastructure as at 30 June 2012.The valuation did not include any allowance for capital gains tax that may arise on disposal. Consolidated 2013 2012 $‘000 $‘000Aggregate depreciation and amortisation allocated, whetherrecognised as an expense or capitalised as part of the carryingamount of other assets during the year.- Leasehold land 828 718- Buildings 24,705 23,163- Roads, runways and other infrastructure 26,024 23,516- Plant and equipment 32,058 27,536 83,615 74,933Australia Pacific Airports Corporation Limited FINANCIAL REPORT 2013 31

Summary of Key Notes Summary of Key Notes to Financial Information for the financial year ended 30 June 2013 Consolidated 2012 2013 $‘000 $‘000 5. Investment properties 1,009,782 959,390 Balance at beginning of financial year Additions for the year 49,369 32,681 Transfers (to) / from property, plant and equipment (17,105) 299 Net gain from fair value adjustments 43,871 17,412 Balance at end of financial year 1,085,917 1,009,782 Investment property was valued by Mr. Martin Reynolds AAPI of the firm Jones Lang LaSalle. Mr. Reynolds is an independent valuer and has extensive experience of valuing property for the consolidated entity. The value of investment property is measured on a fair value basis being the amounts for which the property could be exchanged between willing parties in an arm’s length transaction, based on current prices in an active market for similar property in the same location and subject to similar leases. In assessing the value of the investment property, the independent valuer has considered two basis of valuation being: 1. discounted cash flow; and 2. capitalisation approach 6. Goodwill Goodwill at cost: 671,866 671,866 Goodwill has been allocated for impairment testing to two cash generating units, being the operations of Melbourne ($667,700,000) and Launceston Airports ($4,166,000). The recoverable amount of cash generating units is determined based on a value in use calculation which use cashflow projections based on financial budgets approved by management covering a ten year period, and a discount rate of 11.9% per annum, (2012: 11.9%). 7. Other intangible assets - - Gross carrying amount – at cost 2,211 - Balance at 1 July 2,211 - Additions Balance at 30 June - - Accumulated amortization (439) - Balance at 1 July 1,772 - Amortisation expense Balance at 30 June 43,431 7,380 Net book value at 30 June 8. Other financial assets Cross currency interest rate swap 32 Australia Pacific Airports Corporation Limited FINANCIAL REPORT 2013

Summary of Key Notes to Financial Information Summary of Key Notesfor the financial year ended 30 June 2013 Consolidated 2012 2013 $‘000 $‘0009. Current payables 60,582 44,137Trade payablesGoods and services tax payable 1,767 2,735Non-trade payables to:- Other 731 387 63,080 47,259Interest Payable to:- Secured debt – other entities (i) 24,254 22,903- Other 338 262 24,592 23,165 87,672 70,424(i) Secured by a fixed and floating charge over the consolidated entity’s assets. Security given is all the assets of all operating companies. There have been no defaults on loans payable during the current or prior years..10. Current borrowingsSecured:– Senior – bank debt (i) - 10,000(i) Secured by a fixed and floating charge over the consolidated entity’s assets. Security given is all the assets of the operating companies. There have been no defaults on loans payable during the current or prior years.11. Current tax liabilities 19,132 10,936Income tax payable 5,592 5,318 8,01812. Current provisions 12,582Employee entitlements13. Other current financial liabilitiesInterest rate swapsAustralia Pacific Airports Corporation Limited FINANCIAL REPORT 2013 33

Summary of Key Notes Summary of Key Notes to Financial Information for the financial year ended 30 June 2013 Consolidated 2012 2013 $‘000 $‘000 665,500 14. Non-current borrowings 428,500 – Senior – bank debt (i) 100,000 – Domestic bonds (i) 100,000 100,000 • Fixed rate notes (6.5% 26 August 2014) 100,000 200,000 • Fixed rate notes (6.0% 15 December 2015) (ii) 200,000 250,000 • Variable rate notes (15 December 2015) (ii) 250,000 • Fixed rate notes (7.0% 25 August 2016) 225,000 - • Fixed rate notes (5.0% 14 June 2020) US Private Placements (i) 191,077 191,077 Fixed rate US $200m (7.5% 15 September 2021) (iii) 191,077 191,077 Fixed rate US $200m (7.4% 15 September 2023) (iii) 191,077 191,077 Fixed rate US $200m (7.4% 15 September 2026) (iii) Fixed rate (5.95% 15 January 2028) 50,000 - Variable rate notes (5.8% 15 January 2022) 125,000 - 2,051,731 1,888,731 Exchange rate fluctuation (fair value hedge) (16,731) 22,629 Total borrowings 2,035,000 1,911,360 Deferred borrowing costs (10,208) (9,827) 1,901,152 2,025,173 3,111 Aggregate amortisation allocated, whether recognised as an expense or capitalised as part of the carrying amount of other assets during the year: – Deferred borrowing costs 2,908 (i) Secured by a fixed and floating charge over the entity’s assets (ii) Debt subject to credit wrapping by MBIA Inc (iii) excludes cross currency swaps that convert the US private placement notes US $600m into AUD. 15. Non-current payables 1,202 1,191 Non trade payables 392,325 344,244 16. Deferred tax liabilities Temporary differences 1,520 1,275 17. Non-current provisions 4,415 4,947 Employee benefits 39,407 59,077 43,822 64,024 18. Non-current other liabilities Unearned revenue Interest rate swaps 34 Australia Pacific Airports Corporation Limited FINANCIAL REPORT 2013

HOMESummary of Key Notes to Financial Information Summary of Key Notesfor the financial year ended 30 June 2013 Consolidated 2012 2013 $‘000 $‘000 6,99219. Capitalised borrowing costs 7,734 611Property, Plant and Equipment 7,603Investment Property 1,790 9,524Weighted average capitalisation rate on funds borrowed generally 7.0% (2012: 7.5%)20. Issued capital118,100,000 Ordinary shares – fully paid (2012: 118,100,000) 118,100 118,100Changes to the then Corporations Law abolished the authorised capital and par value concept in relation toshare capital from 1 July 1998. Therefore, the Company does not have a limited amount of authorised capitaland issued shares do not have a par value.Fully paid ordinary shares carry one vote per share and carry the right to dividends.21. reserveHedge reservesBalance at beginning of financial year (60,832) (36,103)Gained recognised:– interest rate swaps 99,646 (35,327)Deferred tax arising on hedges (29,894) 10,598 69,752 (24,729)Balance at end of financial year 8,920 (60,832)The hedging reserve represents hedging gains and losses recognised on the effective portion of cash flowhedges. The cumulative deferred gain or loss on the hedge is recognised in profit or loss when the hedgedtransaction impacts the profit or loss.22. Retained earnings 631,128 603,125Balance at beginning of financial year 202,011 169,723Profit for the year (148,452) (141,720)Dividends paid 684,687 631,128Balance at end of financial year 198,687 90,18123. Commitments for expenditure 198,687 90,181Capital expenditure commitmentsProperty, plant and equipmentNot longer than 1 year24. Subsequent eventsNil.Australia Pacific Airports Corporation Limited FINANCIAL REPORT 2013 35