Thursday, February 4, 2016

Airports up up and away for summer

Cairns Airport reported strong growth in December with international up 22.9% and domestic up 6.9% on the previous year. While the international recovery has sustained recent momentum it is the domestic number there which is particularly impressive given the relative scale and contribution to trend growth.

December seems to have been an exceptional month elsewhere as well. Traffic through Sydney was outstanding given its size and scale with domestic up 5.6% and international 8.6% for a total 6.7% growth. All well above trends "driven by strong load factors and seat capacity growth". Domestic was the strongest monthly growth since 2012 with seat capacity also up 4.6% on the previous year.
Qantas has previously flagged a shift in capacity from resource related to tourism routes. Gold Coast hasn't yet posted numbers for December but to November has reported total passenger growth of 5.1% for the first five months of FY2016 with double digit growth in international at 12.2%.
Over the ditch in the rebellious eastern provinces Auckland Airport (AIA) also continues the growth story. International (ex transits) was up 8.8% in December and domestic (NZ) up 10.8%. AIA also operates Queenstown Airport which completed a big 2015 with international +25.9% and domestic + 10.1% for the year. Monthly domestic was up 20% for December at Queenstown and international 26.8%. AIA is also a stakeholder in NQ Airports (Cairns & Mackay). Mackay was down 11% in December on the previous year in line with the resource sector weakness.
Brisbane is more problematic with posted December numbers containing apparent errors. Brisbane reported growth of 5.6% in both domestic and international. However domestic appears actually to be just 2.5% based on the raw numbers posted? There is also a discrepancy of a thousand in adding up the totals for the month. One hopes the person counting heads at Brisbane is not also responsible for air traffic control. 
ABS arrivals and departures data for December is scheduled for release at the end of next week.

Thursday, January 28, 2016

Cultural icons and avocados

Michael Pascoe took issue with the Australia Day lamb promotion as a triumph of marketing over history: Vegan-stirring lamb ad pulling the wool over our eyes

How did a Kiwi icon become the Australian national meat? If anything it should be mutton but when was the last time you saw mutton on Masterchef or even in the pet food section at Woolworths? Food traditions evolve rapidly which brings us to avocados and the price thereof.

A relatively recent arrival the avocado has been adopted by Strayans with relish. It has become an icon of our burgeoning café culture. Cartoonist Jon Kudelka has suggested a smashed avocado as replacement for the Union Jack in any new flag design.

However it would appear that demand has recently surpassed supply with skyrocketing prices. A spat has broken out within the avocado community with finger-pointing claims of market manipulation, denials and counter-claims. Apparently we will have to wait for the Queensland Shepherd variety in March to restore reasonable prices.

The truth behind the avocado shortage: growers made 'innocent mistake'

Australian avocado crisis explained

Avocado growers reject market manipulation claims amid national shortage

Australians Aghast At National Avocado Shortage

The national avocado shortage is going to get worse

So spare a thought for our world class café entrepreneurs, culinary cultural warriors who this Australia Day were confronted not just with public holiday penalty rates but usurious costs for their smashed avocados!

Friday, January 22, 2016

Regions still losing employment share

Regional employment numbers this week and among issues noted at Queensland Economy Watch was the divergence between SEQ and Regional Queensland: Challenging conditions outside SEQ

SEQ  comprises the Greater Brisbane, Gold Coast and sunshine coast statistical regions. The analysis here is similar to a previous post at Loose Change last August:  Queensland regions skew south east. To update from that post regional as a percentage of Queensland employment:

Source: Conus Trend & ABS

The regional share has fallen to a new low for the series below 30% and is down almost 1.2 percentage points over the past year. Cairns is likely to be an outperformer among the regions in the period ahead but that wont stem a continuing trend decline for the regions relative to SEQ.

Friday, January 15, 2016

Regional rentals still diverging

RTA rental data has been updated for the December quarter 2015. Divergent trends between Cairns / Townsville / Mackay continue. Most stark is the 2br unit category where Mackay plummeted to a median of just $200 a week.

 Mackay is a thin market in this category relative to either Cairns or Townsville. But.

Sunday, January 10, 2016

How funny?

Hillbilly Watch 11 September 2013

This blog as well as other media outlets are being bombarded with negative source material gleaned from amateurish Google searches, somehow under the misconception that nothing gets vetted.
Much of the negative material is being generated by a website called ArchieButterfly, authors unknown.  Despite the sensationalist headlines ("Tony Fung and the People's Liberation Army", "The Great Barrier Reef Swindle"), there is little of substance in any of the stories.

Hillbilly Watch December 26 2015

Bhangoo and his board were said to have had an inside track with the Campbell Newman government, a track that went awry when Newman and his clown school were ejected by the voters.  And Bhangoo and his mob are under investigation in Brisbane for fraud that involves the Newman government and fraudulent rental subsidies at Brooklyn on Brooks, Chelsea Apartments (Bowen Hills), and the Meridian Apartments at Mayne.  Failure to close on the sale of the Gold Coast Mirage may provide the media for people to chase all of 2016.  Stay tuned. . . .    

Source: Archie Butterfly.

Don't get me wrong. I like Archie. But wary of the volatility and reliability. As I am with Hillbilly.



Tuesday, December 29, 2015

Way out west where the rain does fall

What's that? Hereford cattle?

This post could also be titled as the rain depression low what never became Stan which is the name of the next cyclone. I apologise to anybody named Stan who may have been offended by previous cynicism on his potency. The Stan which never happened has delivered for western Queensland this week.

Brownsvillle is flirting with avoidance of an historic driest ever year on record. Cairns got lucky again and on track for well above average December rainfall and completely avoided the drought suffered by surrounding regions.

Christmas cricket at Blackall

Friday, December 25, 2015

Direct flights to Toowoomba

Top End airline to link Wellcamp to Melbourne and Cairns with E-170s
It’s a great part of Australia, and its about to get the most comfortable domestic jet type in service to link its new airport to Melbourne and Cairns.
Brisbane West Wellcamp Airport near Toowoomba will get daily Airnorth E-170s to Melbourne, and three times weekly flights to Cairns, from 14 March.
Airnorth chief executive Daniel Bowden said “This initiative provides a much-needed direct link for residents of Toowoomba and surrounding regions to Melbourne and Cairns for business and leisure travellers alike.
“The new flights will also allow passengers from the Toowoomba region to easily connect onto international and other domestic services via Cairns or Melbourne.”

Will be interesting to see how these flights work out.

Wednesday, December 23, 2015

Packer v Fung; Dalton v King

My two fave Cairns journalists appear to have sqaured off over Aquis: Aquis licence decision imminent as part of stadium package deal. This was posted on FB as a PRO TIP: Before you read it in The Cairns Post tomorrow

It was sourced from the sports pages of The Guardian from a local soccer representative.

The Cairns Post responded: Aquis rules out February decision for $8.15bn casino near Cairns

Never mind. The King Parrott followed up with a Q&A: Aquis remains tight-lipped on Cairns plans

Meanwhile. Keen financial wonks may have noted that back in the real world the biggest financial story of the week was rumours of young Jamie Packer taking Crown Resorts private. The public stockmarket was not adequately valuing the business and aggressive expansion plans apparently.

Now this gets interesting because Fung is proposing on current PR spruik to fund similarly ambitious casino development from the public ASX listed Aquis Entertainment. An opposite strategy. Who am I to question the financial strategy of billionaires? However, can they both be right?

Someone is gunna make money tralalalalaslala!

Thursday, December 17, 2015

ABC of tax data

Quite a bit of recent data of local interest to catch up on but was distracted today by the ATO release of corporate tax data in the interests of transparency. Predictably there have been some rather misguided commentary based on reports such as this at the ABC:  Zero Tax: Data reveals how much tax major Australian corporations pay

When I first looked at this I wondered why the Australian Tax Office had presented "tax payable as a proportion of total income" and not as a proportion of "taxable income". The answer is that they didn't but rather the ABC derived this mostly, but not always irrelevant metric from the data themselves. I had thought even the most clueless numpty was aware that Woolworths pay corporate tax on corporate profits and not sales revenue (income). The ABC reporting along with much commentary doesn't seem to have bothered with the ATO commentary and particularly the contextual information: Corporate tax transparency report for the 2013-14 income year

Ranking corporate tax to total income as the ABC has done really mostly ranks differences in profit margins and between different types of businesses. Consequently I'm not sure the data and misguided reporting has really helped much in identifying where problems may lie in the corporate tax system or contributed greatly to transparency. Beyond a few predictable corporations I cant find much in this general data which shows what some outraged people think it does.

Tuesday, December 8, 2015

40 y.o. nickel refinery set to fledge?

Katter calls on Fed Govt to extend lifeline to Nickel Refinery
Federal Member for Kennedy Bob Katter has today called on the Federal Government to extend some of its $5,000 million earmarked for development of North Australia – to save the fledging Yabulu Nickel Refinery in North Townsville.
“The Liberals can find $5,000 million for the development of Northern Australia – well the closure of the Nickel Refinery will be a mortal blow for Northern Australia.
“When it was scheduled for closure last time no one came forward to buy it – but Clive Palmer, whatever else might be said of him, took a great risk and showed great foresight in buying it.
“He made a lot of money out of it, but the mining game is such that you make money and you lose money.
“And the truly worrying thing is that last time there was no other interest in the Nickel Refinery.
“The Government is prepared to spend $5,000 million looking after their rich corporates – that’s seems to be all they’ll ever look after.
“I’m sure they can bring a little bit of that money across to help out the refinery and the people of Townsville,” Mr Katter said.
It has been estimated that anywhere from 800 to 3,000 families could be impacted if the refinery were to close.

I'm flabbergasted.

Thursday, December 3, 2015

Dalton Shameless

Cairns Post, December 3, 2015: FNQ beats Gold Coast to attract most overseas holiday-makers in Queensland
TROPICAL North Queensland has stolen the international holiday-maker crown from the Gold Coast for the first time.
Nearly 700,000 overseas holiday-makers spent nearly $1 billion when visiting the region, the latest International Visitor Survey shows.
The Tropical North recorded 697,000 visitors – 10,000 more than the Gold Coast and 146,000 more than Brisbane (551,000).

Cairns Post, December 5, 2014: North Dumps Gold Coast For Top Spot
The tropical north has beaten the Gold Coast for the first time as the most popular destination in Queensland for international holiday makers.
According to international visitor survey figures for the year ended September 30 this year, 665,000 international holiday-makers visited the region, 23,000 more than the Gold Coast and 155,000 more than Brisbane.
Guess who? Yes it's Nick Dalton again, business editor and plagiarist at the Cairns Post. This year the same story and incorrect claim was even promoted to the front page headline. The numbers above actually appear to indicate that FNQ/TNQ has lost ground to Gold Coast and Brisbane in the past year?

I can't find a link online to last years Cairns Post yarn but it was posted here at Loose Change at the time: A Dalton too far?  Let me also repost the same graph from last year for the benefit of the professionals (sic) at the Cairns Post:


The first time for what? Does anybody at the Compost actually fact check the notorious BS from Dalton before they turn it into a front page splash?

Update: Analysis of the latest international visitor survey at Conus Strong International Visitor Survey results; but TNQ is lagging behind

Tuesday, November 24, 2015

Cyclone misogyny: deja vu journalism

Where have I seen this before?

Yes, it's the same statistically debunked "research" on hurricane names in the USA dredged up and recycled again by an "award winning" ABC journalist in Darwin almost eighteen (18) months after its first run around the media circuit, which had also included the ABC.

This "research" was statistically annihilated by Paul Fritjers from UQ at Club Troppo: How to lie with statistics: the case of female hurricanes. Which I then posted on at Loose Change: How to lie with statistics: the case of female hurricanes.

Never mind. La Canna has sent it off to the BOM and elicited a gotcha response for a headline:
"We will have to get someone onto it," Mr Sharp said.
Probably best not to waste scarce funds on this one Sharpie! Hopefully we will hear nothing further on it from the BOM but there is plenty of scope for another trot around the media circuit.

Probably shouldn't be too tough on La Canna. Must be difficult as an ABC journo in Darwin trying to compete with the now officially PM sanctioned NT News.

Saturday, November 21, 2015

Gold Coast Glitters

Regional labour force data was this week and as usual Conus has posted analysis of the numbers: Not much joy in regional jobs data although Cairns Youth shows some positives
The Trend in Cairns shows us that jobs continue to be lost. For the fifth consecutive month Trend Employment has fallen; this month by 400. Over the course of the past 12 months Trend Employment in Cairns has risen by just 500 with most of the gains made in the first quarter of this year having been wiped out. The Trend Participation Rate has also been falling (now at 59.9) and this has been the main reason the Trend Unemployment Rate has actually moved slightly lower, despite weaker jobs growth.
A few months ago I posted on the regional employment split between SEQ and the rest: Queensland regions skew south east. That split remains and Gold Coast, by far the largest population region outside Greater Brisbane, remains a star performer. The Gold Coast participation rate has now risen to an historical high for the series on the Conus Trend and makes an interesting comparison with Queensland and Cairns.

Source: Conus Trend & ABS
Once upon a time Gold Coast had a reputation as a retirement destination which could have at least partly explained a participation rate below the Queensland average. Meanwhile the participation rate in Cairns has historically trended above the Queensland rate. The significant divergence there in recent years is presumably outside any volatility attributable to sample size and volatility in the regional data?

Wednesday, November 11, 2015

Building approval trend subsides in Cairns

Building approvals data for September was out last week as reported at Conus: Building Approvals pick up in Cairns; dip in Cassowary Coast
In Cairns (incl Port Douglas) the unadjusted data showed 61 approvals (up from 44 in Aug) and as a result the Conus Trend has improved slightly to 54 (with Aug revised up to 53 from 52). However, despite this improvement, Trend Approvals remain 12.1% below their level of a year ago.
The trend decline in Cairns over the past year is a concern given the previous recovery was from a very low base and never reached anything approaching a robust level. Pete has included Douglas in the Cairns LGA data for consistency in the series through the de-amalgamation period. Douglas (16) had a strong month and was mostly responsible for that increased September number.

A look at the SA3 numbers that make up Cairns SA4 shows that Tableland (36) had a standout month. Conus has also noted a trend improvement on the Cassowary Coast over the past year. So when we look at the now completed first quarter of FY2016 we find that the Cairns urban area (Cairns North + Cairns South = 138) has been outperformed by the surrounding regions (Cassowary Coast + Douglas + Tableland = 146). That is despite significantly lower population and projected growth rates.

While the volatile unit sector has been prominent in the national and state numbers there are none posted so far in FY2016 for Cairns. Not sure where the Aspial proposal and others are at but nothing has appeared yet in the ABS data?

Sunday, October 11, 2015

The effiency of real estate markets?

Both diverted and disinterested recently but a post at Conus managed to draw some attention and commentary: Cassowary Coast stars in the regional building approvals race

Interest here was the continuing gap in building approvals between Cairns and Townsville with dwelling approvals in Cairns running around half approvals in Townsville. There is a good comment there on the nature of differences between the two cities regards supply and demand which doesn't have me entirely convinced.

However last week the RTA also updated rental bonds data. Median rent trends remain soft in Townsville particularly noted in 3br houses:


Median rent in the September quarter for a 3br house in Townsville was $55 below Cairns. That is quite a turnaround over four years from the September quarter 2011 when the median Townsville rent was $40 above Cairns. New bonds lodged for the quarter were quite high for this category however the gap trend in 4br houses is similar and now $60 higher in Cairns. Units perhaps not quite so pronounced:

RTA also post total rental bonds lodged at the end of the quarter with data back to 2012. There are some striking differences here also between Cairns and Townsville over that period. Douglas has been amalgamated with Cairns for consistency over the period:


Cairns has had a significantly higher proportion of renters although Townsville appears to have been catching up. Growth in rental bond numbers seem pretty consistent in Townsville while Cairns has stagnated over recent years. We may have to wait until the 2016 census results for a better fix on that.

Rentals in Cairns are also significantly more weighted to units relative to houses compared to Townsville:

An additional complication in any Cairns analysis may be the amount of stock that can move between the permanent rental and tourism accommodation sectors at the margin.

Sunday, September 20, 2015

Ig Nobel 2015

The annual Ig Nobel Awards is always a favourite and this year some Australian scientists have excelled themselves with the chemistry prize for developing a process to un-boil an egg. However I think the overall winner this year should go to the biology prize:
BIOLOGY PRIZE  — Bruno Grossi, Omar Larach, Mauricio Canals, Rodrigo A. Vásquez [CHILE], José Iriarte-Díaz [CHILE, USA], for observing that when you attach a weighted stick to the rear end of a chicken, the chicken then walks in a manner similar to that in which dinosaurs are thought to have walked.

The 2015 Ig Nobel Prize Winners

Wednesday, September 16, 2015

Great moments in real estate spruiking on Twitter

Michael Matusik @MichaelMatusik 18 minutes ago
We estimate that Gladstone’s new housing market is now slightly undersupplied by about 5% >
Michael Matusik @MichaelMatusik 1 hour ago
There are currently 2.2k dwellings for sale in equating to a 22 month supply more >
What more can I say?

Wednesday, September 2, 2015

Positive data on international visitors

The latest International Visitor Survey from Tourism Research Australia provides further support for stronger international tourism in the year to June 2015. Commentary as posted at Conus: Great International Visitor Data for the Far North
In TNQ visitors were up a stellar 9.8% on the year to 759,000; a level not seen since Sept 2008. Average expenditure per visitor was up strongly (+7.6%) to $1,318. Clearly TNQ has benefited from the surge in Chinese visitors which rose by 16.1% over the year and accounted for 21.8% of all international visitors to the region (up from 20.6% a year ago). But it’s not just the Chinese; over the year visitors from the US are up 12.8% and the UK up 13.6%. As is the case for the state as a whole, TNQ has seen a dramatic decline in market share in the past decade but we are starting to see some (slow) recovery. TNQ’s share of the total Australian international market now stands at 11.6%; this is an increase from 11.2% a year ago but is still well down from the heady heights of 17% ten years ago.
The ongoing recovery in international at Cairns Airport was supported in July by a very strong month also at the main gateway through Sydney Airport.
July’s international result was driven by higher average load factors (2.8 percentage points) and capacity increases. Inbound nationalities were 9.1% higher due primarily to growth from Chinese (+13.3%), Indonesian (+34.6%), Indian (15.2%) and US (12.8%) nationals. Australian outbound grew 3.3% as a result of school holidays and increased seat supply, particularly to the USA, UAE, Philippines and Singapore.

Hopefully the current market turmoil and uncertainty around the Chinese economy wont impact these trends much.

Tuesday, September 1, 2015

Aquis: drum beats from the circus tent

Despite no apparent real news the past week has seen further drum beating on Aquis at the Cairns Post:
Developer Tony Fung has listed his Aquis Entertainment company on the Australian Securities Exchange and last week announced a $330 million upgrade of the Canberra casino he paid $6 million for last year.

Old mate Nick Dalton reported this $330 million announcement last week. Actual real Aquis announcement to ASX in full which only came yesterday afternoon:

31 August 2015
Aquis Entertainment Limited (ASX: AQS) is pleased to announce that it has now successfully lodged with Invest Canberra its confidential proposal for a significant redevelopment of the Casino Canberra site. This is part of an ongoing dialogue with the ACT Government in relation to the future growth plans of Canberra Casino.

Curiously, I can't find that this, or the $330 million, has yet been reported anywhere else except Cairns? Not even in Canberra? It wasn't even flagged to ASX as price sensitive. The intention to submit a redevelopment proposal was included in the recent prospectus but with no information on cost or how it would be funded. The balance sheet for the newly listed entity has net assets of just $18 million which is not going to fund a $330 million redevelopment absent further capital.

As part of the backdoor listing a few million in further capital was raised via the prospectus at 20c / share. The offer had to be extended twice. With Fung holding almost 90% of shares market liquidity in AQS is going to be very low and the few trades since listing have been below 20c.

Ordinarily an ASX listed entity should have now posted half yearly results. Presumably this is waived and not feasible for AQS given the circumstances and time constraints? Consequently there doesn't appear to have been any trading update for the casino since the accounts for the year to December 2014 were lodged with ASIC in March?

An interesting aspect of the 2014 accounts is an apparent turnaround to profit for the Canberra Casino. However it turns out this is due to debt forgiveness by Casinos Austria of a $6.7 million loan which was booked to revenue. So having been paid only $6 million and then writing off a $6.7 million loan Casinos Austria have virtually paid Fung to take it away. Revenue for the 2014 year was down 10% on the previous year.