Alarming situation revealed

It will be ‘‘some time, if not years’’ before New Plymouth’s airport financially recovers from the coronavirus pandemic, councillors have been told.

The decimation of airport company Papa Rererangi i Puketapu’s finances were revealed at an extraordinary New Plymouth District Council meeting on Tuesday.

The airport’s new $28 million terminal opened in early March but was shutdown within weeks when the country moved into lockdown, significantly impacting revenue.

For the latter part of March, post the lockdown decision, only 186 passengers came through the airport. For the same period last year it was 6121.

For April, the invoice to Air New Zealand was $269.50, and total revenue for the month is likely to be under $1000. But the company will still be facing about $184,000 for expenses.

As a result, it requested a $2.6m loan increase from the council, its 100 per cent shareholder, which was later altered to $1.9m.

NPDC chief operating officer Kelvin Wright told councillors the reduction came from deferring the $550,000 runway edge resurfacing and delays to existing contracted works, which gave a $150,000 benefit to cashflow.

‘‘Due to the uncertainty of the alert levels in the coming months it’s difficult to say when the airport may return to a commercial financial position, but there’s no doubt it will be some time, if not years.’’

At the meeting, councillor Colin Johnston asked if there was any of the loan for the new terminal left over, and Wright said from the two council loans there was about $635,000, which would be used for the month of May.

The $1.9m from NPDC would be $400,000 for June and $1.5m for July.

New Plymouth councillors approved the $1.9m loan increase, taking the working capital loan limit to $4.9m. The long-term loan limit remained at $29.5m.

But it may not be the last time the company comes to the council with its hand out.

Deputy mayor Richard Jordan said council was obliged to keep it going and that would take a ‘‘considerable amount of money’’.

‘‘What we will have to do over the next three months is ascertain what that figure could be.’’

While a couple of councillors were reluctantly supportive of the loan, Murray Chong was the only one who said no. This was on principle, as councillors were told the ratepayers would not have to fund any of the airport, he said.