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1 ASX Release 2 May 2012 Sydney Airport Presentation at Key Investment Themes Events Please find attached a presentation to be delivered by Sydney Airport management, as part of the Goldman Sachs Asset Management hosted Key Investment Themes events during May For further information, please contact: Hugh Wehby Head of Investor Relations Tel: Mob: hugh.wehby@syd.com.au Tracy Ong Manager Media and Communications Tel: Mob: tracy.ong@syd.com.au Sydney Airport Holdings Limited ABN AFSL _1 10 Arrivals Court Sydney International Airport New South Wales 2020 T or F

2 Sydney Airport Key Investment Themes May 2012 Strictly Confidential

3 Disclaimer General Securities Warning This presentation has been prepared by Sydney Airport Holdings Limited (ACN / AFSL ). This presentation is not an offer or invitation for subscription or purchase of or a recommendation of securities. It does not take into account the investment objectives, financial situation and particular needs of the investor. Before making an investment in Sydney Airport Trust 1 (ARSN ) or Sydney Airport Trust 2 (ARSN ) (Sydney Airport), the investor or prospective investor should consider whether such an investment is appropriate to their particular investment needs, objectives and financial circumstances and consult an investment adviser if necessary. Information, including forecast financial information, in this presentation should not be considered as a recommendation in relation to holding, purchasing or selling shares, securities or other instruments in Sydney Airport. Due care and attention has been used in the preparation of forecast information. However, actual results may vary from forecasts and any variation may be materially positive or negative. Forecasts by their very nature, are subject to uncertainty and contingencies many of which are outside the control of Sydney Airport. Past performance is not a reliable indication of future performance. 2

4 Listed Company ASX-listed Sydney Airport is one of the largest and highest profile businesses in Australia ASX-Listed Sydney Airport Sydney Airport 85% Ownership Listed on the ASX since m passengers in 2011 Enterprise Value of ~A$12bn 1 Generates over 200,000 jobs Economic impact estimated as 2 : A top 50 listed company in Australia ~33,000 investors 6% of NSW economy 2% of Australian economy 1 Based on 31 December 2011 Directors Valuation 2 Source: 3

5 Investment Fundamentals Sydney Airport enjoys a number of strong investment characteristics The Business Gateway to Australia Core component of faustralia s transport t network Balanced and diverse revenue base from aeronautical, retail, car parking and property businesses Surplus aviation capacity Supportive regulatory environment The Performance Proven track record of traffic growth Reliable, resilient cash flows Robust, low risk business Operational leverage and high EBITDA margin 4

6 Operations Sydney Airport is one of the world s leading infrastructure assets 99 year leasehold Lease until 2097 Catchment area Strong passenger growth profile Largest Australian International airport Light handed regulatory framework Fixed cost model Commercial improvements Potential upsides Core catchment area: 7.3m people in NSW and 4.5m people in Sydney Major international airport in New South Wales Both a business and tourism hub, in a growing Australian economy Strong Asian connections growth of middle class in China, India, Malaysia & Indonesia Disproportionate t contribution ti of international ti passengers Account for approximately 75% of EBITDA but only 12% of total slots and 33% of pax Direct agreements with airlines include contractually agreed charges increases on new aeronautical assets the Necessary New Investment model ( NNI Model ) Dual till principle enshrined in regulatory framework Real operating costs 1 are largely fixed, and have a low traffic elasticity Operating costs mainly relate to management and administration functions Generally, CPI escalation in retail, periodic car parking price reviews and CPI or market rent reviews for property Development of additional parking bays to meet demand Expiry of Terminal 3 lease in 2019 and Jet Base lease in 2020 MoUs signed for the New Vision proposal of integrated alliance networks 1 Excludes security costs which are passed through to airport users 5

7 Sydney Airport Capacity and Passenger Growth Strictly Confidential

8 Joint Study on Aviation Capacity in the Sydney Region Summary of Findings On 2 March 2012 the Steering Committee overseeing the Joint Study on aviation capacity for the Sydney region presented their report to the Australian and NSW Governments. It supported: maintaining Sydney yairport as the primary airport for Sydney y and NSW, ensuring the airport can grow to its maximum practical operational capacity optimising use of existing airports (e.g. Bankstown, Richmond, Canberra and/or Newcastle) identifying a site for a secondary airport in the long term and recognising the need to consult with Sydney Airport There were many statements and recommendations that would, if implemented, increase the capacity of Sydney Airport: changes to the operating restrictions incl. increases to the movement cap per hour in nine peak hours each weekday improving rail and road links and increasing the use of public transport to the airport precinct limiting growth beyond 2015 to aircraft larger than 50 seats, and beyond 2020 to aircraft larger than 70 seats accelerating plans for the implementation of advanced air traffic management systems The report also recognised that Sydney Airport s New Vision will enhance the capacity and efficiency of the airport 7

9 Sydney Airport s Capacity The Facts Sydney Airport has ample capacity on its runways and in its terminals Based on the proposed reconfiguration, and without changes to the runways, curfew or cap, a secondary airport will not be required before 2045 The current master plan envisages passenger numbers will grow to 79 million (from 36 million in 2011) by 2029 without requiring changes to the runways, curfew or cap Only 61% of Sydney Airport slots are currently being used Since 2000, 41% (approx 10 million people) p more passengers have used Sydney yairport with only 0.3% more aircraft movements New generation, quieter and larger aircraft are transforming airport usage In 1976 there was an average of 129 passengers per international flight Today there is an average of 190 passengers per international flight By 2030 that number is forecast to increase to 290 passengers per international flight The introduction of low cost carriers and the growth from Asian markets, will assist Sydney Airport to maximise use of the airport across the off-peak periods 8

10 Traffic Resilience Long term traffic trends upwards despite significant shocks x NATURAL DISASTERS GFC WTC ATTACK ANSETT COLLAPSE QANTAS DISPUTE & GROUNDING TIGER GROUNDING Pax (m) PILOTS STRIKE 10 5 GULF WAR IRAQ WAR, SARS LONDON BOMBINGS MADRID BOMBINGS Source: Sydney Airport International Domestic Total 9

11 Structural Traffic Drivers Sydney Airport is continuing to deliver growth from industry structural changes Aircraft Technology - More seats at a lower cost - Longer range, more fuel efficient, quieter e.g. 92 A380 movements/week, B787 orders Alliances - Creating financially stronger airlines - Greater number of viable routes & flights e.g. Qantas oneworld & Virgin bilaterals Industry Structural Changes Liberalisation of Air Rights Low Cost Carriers (LCCs) - Gradual lifting of air right restrictions - Removes supply side air travel constraint e.g. China, Malaysia, Indonesia, USA - Significant capacity growth - Efficient use of airport infrastructure e.g. Scoot, AirAsia X, Jetstar 10

12 Sydney Airport Business Model

13 Business Summary and Drivers Strong revenue link with traffic, investment & inflation Revenues 1 Good diversification of income sources with a balanced aeronautical / commercial mix Commercial Property & Car Rental 16% Other 1% Car Parking & Ground Transport 11% Aeronautical Aeronautical 41% Traffic Aeronautical Revenues Retail Revenues 1 Car Parking Revenues Investment Aeronautical Revenues Retail Revenues Car Parking Revenues Property Revenues Retail 23% Inflation Source: Sydney Airport 1 Revenue split based on CY2011 breakdown Aeronautical Security Recoveryer 8% Aeronautical Revenues 2 Retail Revenues Car Parking Revenues Property Revenues 1 If not in MGR 2 Indirectly 12

14 Business Model delivered impressive conversion of traffic to growth in EBITDA and cash flows Sydney Airport CAGR % 10% 8% 6% 11% 4% 7% 2% 3% -% Traffic EBITDA Cash Avail After Debt Service 1 Includes the benefit of degearing in 2008/09 13

15 Investor Return and Distribution Guidance Average annual investor return of approximately 14% since listing in April total investor return of 22.7% compared to ASX200 Accumulation Index return of -10.5% 2011 investor return included A$1.01 in cash payments to investors comprising: A$0.11 interim i distribution ib ti and A$0.10 final distribution ib ti A$0.80 payment as part consideration for the Simplification Reaffirm 2012 distribution guidance of approximately A$0.21 per stapled security (7.3% yield, assuming $2.88 security price) Expect 100% coverage of 2012 distribution by net operating receipts defined as: 84.8% of distributions declared by Sydney Airport1 Less corporate costs This is subject to external shocks to the aviation industry and material changes to forecast assumptions 1 Southern Cross Airports Corporation Holdings 14

16 Sydney Airport Outlook

17 New Vision Progress and Benefits Improved Connectivity, Increased Capacity, Reduced Congestion, Better Ground Access In December 2011, Sydney Airport announced a new vision for growth. The new vision includes development of two airport precincts co-locating international, domestic and regional services under one roof Significant activity already underway in 2012: consultation with wider stakeholder groups giving rise to additional opportunities to enhance the New Vision master planning process consultation around future investment programme and potential lease reversions Additional investments remain discretionary and will be pursued where returns are appropriate New Vision Timeline CY2012 CY2013 CY2014 CY2015 CY and beyond Consultation Planning Potential Lease Reversion Negotiations Aeronautical Charge Negotiations Construction & Implementation

18 Summary Sydney Airport is a resilient business with a compelling yield and capacity to grow Essential and high profile infrastructure asset for Sydney, NSW and Australia Significant capacity to grow Aviation structural changes to drive continued traffic growth and resilience Ability to achieve EBITDA growth above traffic due to: Investment CPI Commercial improvements Trading on a compelling yield 17

19 Questions? Our Vision: To deliver a world class airport experience and foster the growth of Sydney Airport for the benefit of Sydney, NSW and Australia 18

20 Thank you