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FINANCIAL STABILITY A Measured Approach . Solid Results. “IN 2007 WE REPORTED A STRONG BOTTOM LINE AS REVENUES EXCEEDED EXPENSES BY $5.1 MILLION.” Like so much of what’s happened this past year at HIAA, 2007 was the year the “pieces came together,” and we began reaping the financial benefits of our earlier investments. In the airline business, more people passing through our terminal means more people using our concessions, more people parking, more people getting on airplanes. Thanks to a record passenger year and the success of our new US Preclearance facility, HIAA earned revenues of $56.6 million, our highest to date. 2007 also marked our first full year of operation in our new expanded facilities. And while that naturally meant increased costs, we are still able to report a strong bottom line with revenues exceeding expenses by $5.1 million. Growing transborder and international traffic is a cornerstone of our business strategy at HIAA, and this past year we added another incentive for carriers by blending landing fees. Prior to this, lower landing fees were charged for domestic flights than non-domestic, standard practice at many Canadian airports. Blending the two fees, however, means that no matter where flights originate all carriers now pay the same landing fees. While this resulted in a modest cost increase for domestic flights, transborder and international landing fees dropped significantly, giving HIAA yet another competitive advantage in attracting new routes and new carriers. CanJet’s decision in late 2006 to end scheduled service meant an initial drop in domestic traffic – and revenues – for HIAA. Yet despite this, and other current challenges in the industry, by the summer of 2007 domestic traffic and revenues had fully recovered. We’re also pleased to report that our credit rating agency, Standard & Poor’s, affirmed our A+ credit rating, first assigned in 2006 for our initial bond issue. This outstanding rating is one of the best among Canadian airport authorities. In 2007, total revenues for HIAA, including airport improvement fees (AIF), reached $56.6 million compared with $51.8 million in 2006. The growth in revenues is mainly attributed to the first complete year of operation of the US Preclearance facility and increases in AIF revenue due to record-breaking passenger levels. Total expenses were $51.4 million in 2007 compared to $41.3 million the previous year. This rise was due mainly to additional costs in providing commonuse facilities, which included the first full year of operating the US Preclearance facility, increased amortization associated with the expansion, and a full year of interest on our bonds along with the higher costs of maintaining the expanded air terminal building. Overall, revenues exceeded expenses by $5.1 million in 2007 compared to $10.5 million in 2006. As per our madate, this excess will be reinvested in the airport. Looking ahead to 2008, HIAA will continue growing passenger and cargo business by investing in state-of-the-art infrastructure expected of a leading international airport. Over the next 12 months, you can expect to see a number of major capital projects come to fruition including: • Construction of a 2,300-space parking structure along with awarding of the contract and negotiating arrangements for the new airport hotel as part of the $82 million Groundside Redevelopment Program; • Implementation of Phase Four of our six-phase runway restoration program; and • Development of a multi-use cargo facility designed to make HSIA the principal air cargo centre as part of the Atlantic Gateway. With our destination in sight, we remain solidly on course. Our measured approach to financial stability, driven by the vision of our airport as a dynamic, interconnected community, will continue to serve as our guiding principles throughout 2008. HALIFAX INTERNATIONAL AIRPORT AUTHORITY 2007 ANNUAL REPORT 12
financial statements auditors’ report To the Directors of Halifax International Airport Authority w We have audited the balance sheet of the Halifax International Airport Authority as at December 31, 2007 and the statements of operations and changes in net assets and cash flows for the year then ended. These financial statements are the responsibility of the Authority’s management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. In our opinion, these financial statements present fairly, in all material respects, the financial position of the Authority as at December 31, 2007 and the results of its operations and its cash flows for the year then ended in accordance with Canadian generally accepted accounting principles. balance sheet As at December 31 2007 2006 (in thousands of dollars) $ $ assets Current Cash 60,917 77,354 Accounts receivable 3,988 3,943 Inventories 338 380 Prepaid expenses 868 695 66,111 82,372 Capital assets, net (note 4) 185,850 170,223 Deferred financing costs, net (notes 3 and 5) – 3,862 Debt service reserve fund (note 5) 4,127 4,127 Accrued benefit asset (note 8) 375 426 256,463 261,010 liabilities and net assets Current Accounts payable and accrued liabilities 14,458 20,569 Deferred revenue 1,057 938 Current portion of long-term debt (note 5) 80 80 15,595 21,587 Long-term debt (note 5) 149,495 150,644 Security deposits 1,902 1,764 166,992 173,995 Net assets Equity in capital assets (note 6) 89,471 87,015 256,463 261,010 Halifax, Canada February 15, 2008 Chartered Accountants Commitments (note 7) Contingencies (note 10) See accompanying notes On behalf of the Board: Director Director HALIFAX INTERNATIONAL AIRPORT AUTHORITY 2007 ANNUAL REPORT 13
Page 2 and 3: OUR PEOPLE - Burton Wright, Ken Cha
Page 5 and 6: 2007 also marked the beginning of t
Page 7 and 8: w Not all our efforts last year wer
Page 9 and 10: Eighty per cent of our passenger tr
Page 11 and 12: Scheduled and Charter Passenger Ser
Page 13: w Firefighter Tim Bull worked on th
Page 17 and 18: notes to financial statements Decem
Page 23 and 24: CORPORATE GOVERNANCE HALIFAX INTERN
Page 25 and 26: BOARD OF DIRECTORS Peter McDonough,

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