AIRTRAIN chairman Mike Pelly says the privately-owned company is ‘right forever’ after paying back $45 million debt a decade earlier than planned.
The external debt agreement was established in 2005 with forecasts to repay by 2020, but the airport railway company was able to increase payments due to higher revenues.
“I’m very pleased we’re debt-free because times aren’t easy at the moment and when our revenues were improving we accelerated our debt repayment and paid the final instalment in July,” says Pelly.
“What we’ve done is increase our patronage substantially through good marketing and also people realising that the Airtrain is the only way to absolutely ensure they would catch their flight. Even with all the new roads and tunnels, if there’s an accident then they’re not going to get the plane on time.”
Airtrain exceeded expectations last year with 1.8 million passengers, giving it 9.45 per cent of all Brisbane Airport travellers.
“The business is right forever in terms of its profitability. Before we restructured it Airtrain was a cot case, it was going nowhere, but I’m extremely confident for the future,” says Pelly.
“We’ve upped our marketing significantly in the last three or four years. Back in the early days around 2003 they cut marketing right back, which is the last thing you want to do with a new service that you want to encourage people to use. I’d say now we spend about double on marketing what was spent in 2005.”
He expects modest revenue growth of two to three per cent this year.
Airtrain started in 2001 with a licence from Queensland Transport, but the private company receives no government subsidies.
Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support