##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
 For the quarterly period ended March 31, 2006
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
 For the transition period from  to
 Commission File Number: 001-32385
 Macquarie Infrastructure Company Trust
  Delaware
    
    20-6196808(State or Other Jurisdiction of Incorporation or
    
    (I.R.S. Employer Identification No.)Organization)
 
 Commission File Number: 001-32384
 Macquarie Infrastructure Company LLC
  Delaware
    
    43-2052503(State or Other Jurisdiction of Incorporation or
    
    (I.R.S. Employer Identification No.)Organization)
 
 125 West
55thStreet, 22ndFloor
    
    10019New York, New York
    
    (Zip Code)(Address of principal executive offices)
 (212) 231-1000
 
  Securities registered pursuant to Section 12 (g) of the Act: None
  þ o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
  o þ




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##### 



TABLE OF CONTENTS
 PART I. FINANCIAL INFORMATIONITEM 1. Financial StatementsMACQUARIE INFRASTRUCTURE COMPANY TRUSTConsolidated Condensed Balance Sheets as of March 31, 2006 (Unaudited) and December 31, 2005
    
    
    3Consolidated Condensed Statement of Operations for the Quarters Ended March 31, 2006 and 2005 (Unaudited)
    
    
    5Consolidated Condensed Statement of Cash Flows for the Quarters Ended March 31, 2006 and 2005 (Unaudited)
    
    
    6Notes to Consolidated Condensed Financial Statements (Unaudited)
    
    
    8ITEM 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    18ITEM 3. Quantitative and Qualitative Disclosure About Market Risk
    
    
    37ITEM 4. Controls and Procedures
    
    
    37PART II. OTHER INFORMATIONITEM 1. Legal Proceedings
    
    
    37ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    37ITEM 3. Defaults Upon Senior Securities
    
    
    37ITEM 4. Submission of Matters to a Vote of Security Holders
    
    
    38ITEM 5. Other Information
    
    
    38ITEM 6. Exhibits
    
    
    38EX-2.1: PURCHASE AND SALE AGREEMENTEX-10.2: AMENDED AND RESTATED CREDIT AGREEMENTEX-10.3: COMMITMENTS LETTERSEX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32.1: CERTIFICATIONEX-32.2: CERTIFICATIONEX-99.1: EARNINGS RELEASE
  Investments in Macquarie Infrastructure Company Trust are not deposits with or other liabilities
of Macquarie Bank Limited or any of Macquarie Group company and are subject to investment risk,
including possible delays in repayment and loss of income and principal invested. Neither Macquarie
Bank Limited nor any other member company of the Macquarie Group guarantees the performance of
Macquarie Infrastructure Company Trust or the repayment of capital from Macquarie Infrastructure
Company Trust.
 - 2 -




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 ITEM 1. FINANCIAL STATEMENTS
 MACQUARIE INFRASTRUCTURE COMPANY TRUST
 
    March 31, 2006(unaudited)
    
    
    December 31, 2005AssetsCurrent assets:Cash and cash equivalents
    
    $
    126,483
    
    
    $
    115,163Restricted cash
    
    
    1,471
    
    
    
    1,332Accounts receivable, less allowance for doubtful accounts of $882 and $839, respectively
    
    
    21,386
    
    
    
    21,150Dividends receivable
    
    
    2,651
    
    
    
    2,365Inventories
    
    
    1,611
    
    
    
    1,981Prepaid expenses
    
    
    5,545
    
    
    
    4,701Deferred income taxes
    
    
    2,115
    
    
    
    2,101Income tax receivable
    
    
    3,420
    
    
    
    3,489Other
    
    
    5,057
    
    
    
    4,394Total current assets
    
    
    169,739
    
    
    
    156,676Property, equipment, land and leasehold improvements, net
    
    
    334,094
    
    
    
    335,119Restricted cash
    
    
    19,516
    
    
    
    19,437Equipment lease receivables
    
    
    42,999
    
    
    
    43,546Investment in unconsolidated business
    
    
    70,409
    
    
    
    69,358Investment, cost
    
    
    35,716
    
    
    
    35,295Securities, available for sale
    
    
    69,233
    
    
    
    68,882Related party subordinated loan
    
    
    19,492
    
    
    
    19,866Goodwill
    
    
    281,809
    
    
    
    281,776Intangible assets, net
    
    
    296,041
    
    
    
    299,487Deposits and deferred costs on acquisitions
    
    
    18,552
    
    
    
    14,746Deferred financing costs, net of accumulated amortization
    
    
    12,168
    
    
    
    12,830Fair value of derivative instruments
    
    
    14,478
    
    
    
    4,660Other
    
    
    1,614
    
    
    
    1,620Total assets
    
    $
    1,385,860
    
    
    $
    1,363,298Liabilities and stockholders equityCurrent liabilities:Due to manager
    
    $
    6,546
    
    
    $
    2,637Accounts payable
    
    
    15,634
    
    
    
    11,535Accrued expenses
    
    
    12,382
    
    
    
    13,994Current portion of notes payable and capital leases
    
    
    5,970
    
    
    
    2,647Current portion of long-term debt
    
    
    146
    
    
    
    146Dividends payable
    
    
    13,525
    
    
    
    Other
    
    
    3,501
    
    
    
    3,639Total current liabilities
    
    
    57,704
    
    
    
    34,598Capital leases and notes payable, net of current portion
    
    
    3,607
    
    
    
    2,864Long-term debt, net of current portion
    
    
    610,811
    
    
    
    610,848Related party long-term debt
    
    
    18,714
    
    
    
    18,247Deferred income taxes
    
    
    114,790
    
    
    
    113,794Income tax liability
    
    
    2,656
    
    
    
    
 - 3 -




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##### Table of Contents



March 31, 2006(unaudited)
    
    
    December 31, 2005Other
    
    
    7,567
    
    
    
    6,342Total liabilities
    
    
    815,849
    
    
    
    786,693Minority interests
    
    
    8,803
    
    
    
    8,940Stockholders equity:Trust stock, no par value; 500,000,000 authorized; 27,050,745 shares issued and
outstanding at March 31, 2006 and December 31, 2005
    
    
    569,497
    
    
    
    583,023Accumulated other comprehensive loss
    
    
    (4,559
    )
    
    
    (12,966
    )Accumulated deficit
    
    
    (3,730
    )
    
    
    (2,392
    )Total stockholders equity
    
    
    561,208
    
    
    
    567,665Total liabilities and stockholders equity
    
    $
    1,385,860
    
    
    $
    1,363,298
 See accompanying notes to the consolidated condensed financial statements.
 - 4 -




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##### Table of Contents



MACQUARIE INFRASTRUCTURE COMPANY TRUST
 
     Quarter EndedMarch 31, 2006
    
    
    March 31, 2005RevenuesRevenue from fuel sales
    
    $
    41,992
    
    
    $
    30,387Service revenue
    
    
    42,904
    
    
    
    34,006Financing and equipment lease income
    
    
    1,298
    
    
    
    1,342Total revenue
    
    
    86,194
    
    
    
    65,735Costs and expensesCost of fuel sales
    
    
    25,269
    
    
    
    17,095Cost of services
    
    
    21,032
    
    
    
    17,256Selling, general and administrative expenses
    
    
    23,950
    
    
    
    19,162Fees to manager
    
    
    6,478
    
    
    
    1,943Depreciation expense
    
    
    1,710
    
    
    
    1,327Amortization of intangibles
    
    
    3,446
    
    
    
    3,085Total operating expenses
    
    
    81,885
    
    
    
    59,868Operating income
    
    
    4,309
    
    
    
    5,867Other income (expense)Dividend income
    
    
    2,651
    
    
    
    Interest income
    
    
    1,702
    
    
    
    1,099Interest expense
    
    
    (12,339
    )
    
    
    (7,758
    )Equity in earnings and amortization charges of investee
    
    
    2,453
    
    
    
    1,653Other expense, net
    
    
    (167
    )
    
    
    (915
    )Net loss before income taxes and minority interests
    
    
    (1,391
    )
    
    
    (54
    )Income tax expense
    
    
    21
    
    
    
    Net loss before minority interests
    
    
    (1,412
    )
    
    
    (54
    )Minority interests
    
    
    (74
    )
    
    
    29Net loss
    
    $
    (1,338
    )
    
    $
    (83
    )Basic loss per share:
    
    $
    (0.049
    )
    
    $
    (0.003
    )Weighted average number of shares of trust stock outstanding: basic
    
    
    27,050,745
    
    
    
    26,610,100Diluted loss per share:
    
    $
    (0.049
    )
    
    $
    (0.003
    )Weighted average number of shares of trust stock outstanding: diluted
    
    
    27,050,745
    
    
    
    26,610,100Cash dividends declared per share
    
    $
    0.50
    
    
    $
    
 See accompanying notes to the consolidated condensed financial statements.
 - 5 -




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MACQUARIE INFRASTRUCTURE COMPANY TRUST
 
  
 
  Quarter EndedMarch 31, 2006
    
    
    March 31, 2005Operating activitiesNet loss
    
    $
    (1,338
    )
    
    $
    (83
    )Adjustments to reconcile net loss to net cash provided by operating activities:Depreciation and amortization of property and equipment
    
    
    3,998
    
    
    
    3,221Amortization of intangible assets
    
    
    3,446
    
    
    
    3,085Loss on disposal of equipment
    
    
    44
    
    
    
    13Equity in earnings and amortization charges of investee
    
    
    (56
    )
    
    
    238Amortization of finance charges
    
    
    720
    
    
    
    265Noncash derivative gain, net of noncash interest expense
    
    
    897
    
    
    
    Accretion of asset retirement obligation
    
    
    55
    
    
    
    65Deferred rent
    
    
    583
    
    
    
    605Deferred revenue
    
    
    92
    
    
    
    110Deferred taxes
    
    
    (3,072
    )
    
    
    Minority interests
    
    
    (74
    )
    
    
    29Noncash compensation
    
    
    543
    
    
    
    Post retirement obligations
    
    
    29
    
    
    
    (20
    )Other noncash income
    
    
    (8
    )
    
    
    Accrued interest expense on subordinated debt  related party
    
    
    249
    
    
    
    259Changes in operating assets and liabilities:Restricted cash
    
    
    (139
    )
    
    
    (13
    )Accounts receivable
    
    
    (236
    )
    
    
    (1,130
    )Equipment lease receivable, net
    
    
    436
    
    
    
    306Dividend receivable
    
    
    (295
    )
    
    
    1,743Inventories
    
    
    371
    
    
    
    451Prepaid expenses and other current assets
    
    
    330
    
    
    
    407Accounts payable and accrued expenses
    
    
    (1,163
    )
    
    
    (1,726
    )Income taxes payable
    
    
    2,720
    
    
    
    Due to manager
    
    
    3,909
    
    
    
    1,924Other
    
    
    (220
    )
    
    
    11Net cash provided by operating activities
    
    
    11,821
    
    
    
    9,760Investing activitiesAcquisition of businesses and investments, net of cash acquired
    
    
    
    
    
    
    (49,594
    )Additional costs of acquisitions
    
    
    (33
    )
    
    
    (68
    )Deposits and deferred costs on future acquisitions
    
    
    (111
    )
    
    
    Collection on notes receivable
    
    
    
    
    
    
    24Purchases of property and equipment
    
    
    (1,490
    )
    
    
    (879
    )Proceeds received on subordinated loan
    
    
    611
    
    
    
    686Net cash used in investing activities
    
    
    (1,023
    )
    
    
    (49,831
    )Financing activitiesProceeds from long-term debt
    
    
    
    
    
    
    32,000Proceeds from line-credit facility
    
    
    1,275
    
    
    
    Debt financing costs
    
    
    (58
    )
    
    
    (1,674
    )Distributions paid to minority shareholders
    
    
    (63
    )
    
    
    Payment of long-term debt
    
    
    (37
    )
    
    
    (26
    )Offering costs
    
    
    
    
    
    
    (1,833
    )Restricted cash
    
    
    (79
    )
    
    
    (1,079
    )Payment of notes and capital lease obligations
    
    
    (486
    )
    
    
    (349
    )Net cash provided by financing activities
    
    
    552
    
    
    
    27,039
 - 6 -




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##### Table of Contents



Quarter EndedMarch 31, 2006
    
    
    March 31, 2005Effect of exchange rate changes on cash
    
    
    (30
    )
    
    
    11Net change in cash and cash equivalents
    
    
    11,320
    
    
    
    (13,021
    )Cash and cash equivalents, beginning of period
    
    
    115,163
    
    
    
    140,050Cash and cash equivalents, end of period
    
    $
    126,483
    
    
    $
    127,029Supplemental disclosures of cash flow information:Noncash investing and financing activity:Accrued purchases of property and equipment
    
    $
    241
    
    
    $
    Accrued deposits and deferred costs on acquisitions
    
    $
    3,695
    
    
    $
    Acquisition of property through capital leases
    
    $
    1,669
    
    
    $
    438Income taxes paid
    
    $
    290
    
    
    $
    311Interest paid
    
    $
    10,263
    
    
    $
    7,134
 See accompanying notes to the consolidated condensed financial statements
 - 7 -




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MACQUARIE INFRASTRUCTURE COMPANY TRUST
 
   1. Organization and Description of Business
              -8-




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##### Table of Contents



2. Basis of Presentation
    3. Earnings (Loss) Per Share
  Quarter Ended
    
    
    Quarter EndedMarch 31, 2006
    
    
    March 31, 2005Weighted average number of shares of trust stock outstanding: basic
    
    
    27,050,745
    
    
    
    26,610,100Dilutive effect of restricted stock unit grants
    
    
    
    
    
    
    Weighted average number of shares of trust stock outstanding: diluted
    
    
    27,050,745
    
    
    
    26,610,100
  4. Pending Acquisitions
 The Gas Company
   - 9 -




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5. Property, Equipment, Land and Leasehold Improvements
  March 31, 2006
    
    
    December 31,(unaudited)
    
    
    2005Land
    
    $
    62,520
    
    
    $
    62,520Easements
    
    
    5,624
    
    
    
    5,624Buildings
    
    
    32,961
    
    
    
    32,866Leasehold and land improvements
    
    
    109,055
    
    
    
    108,726Machinery and equipment
    
    
    134,070
    
    
    
    132,196Furniture and fixtures
    
    
    1,998
    
    
    
    1,920Construction in progress
    
    
    3,831
    
    
    
    3,486Property held for future use
    
    
    1,233
    
    
    
    1,196Other
    
    
    933
    
    
    
    764352,225
    
    
    
    349,298Less: Accumulated depreciation
    
    
    (18,131
    )
    
    
    (14,179
    )Property, equipment, land and leasehold improvements, net
    
    $
    334,094
    
    
    $
    335,119
 6. Intangible Assets
  Weighted Average
    
    
    March 31, 2006Life (Years)
    
    
    (unaudited)
    
    
    December 31, 2005Contractual arrangements
    
    
    32.0
    
    
    $
    237,572
    
    
    $
    237,572Non-compete agreements
    
    
    2.8
    
    
    
    4,835
    
    
    
    4,835Customer relationships
    
    
    9.8
    
    
    
    26,640
    
    
    
    26,640Leasehold rights
    
    
    13.3
    
    
    
    8,259
    
    
    
    8,259Trade names
    
    Indefinite(1)
    
    
    26,175
    
    
    
    26,175Domain names
    
    Indefinite(1)
    
    
    8,307
    
    
    
    8,307Technology
    
    
    5.0
    
    
    
    460
    
    
    
    460312,248
    
    
    
    312,248Less: Accumulated amortization
    
    
    
    
    
    
    (16,207
    )
    
    
    (12,761
    )Intangible assets, net
    
    
    
    
    
    $
    296,041
    
    
    $
    299,487
   - 10 -




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##### Table of Contents



7. Long-Term Debt
   March 31, 2006(unaudited)
    
    
    December 31, 2005MDE senior notes (1)
    
    $
    120,000
    
    
    $
    120,000Airport services debt (2)
    
    
    300,000
    
    
    
    300,000MAPC loan payable
    
    
    125,448
    
    
    
    125,448MAPC loan payable
    
    
    4,548
    
    
    
    4,574PCAA SP loan payable
    
    
    58,740
    
    
    
    58,740Priority loan payable
    
    
    2,221
    
    
    
    2,232610,957
    
    
    
    610,994Less: current portion
    
    
    146
    
    
    
    146Long-term portion
    
    $
    610,811
    
    
    $
    610,848
 
 (1)
    
    Macquarie District Energy, Inc., or MDE, is a wholly owned subsidiary of MDEH.(2)
    
    Macquarie Bank Limited has provided $60 million of the airport services debt. Interest paid on
Macquarie Bank Limiteds portion of the long-term debt for the quarter ended March 31, 2006 was
$952,000 and has been included in interest expense in the accompanying consolidated condensed
statement of operations. Macquarie Bank Limited is also providing approximately one third of the
interest rate swaps and made a payment to the airport services business of $54,000 for the quarter
ended March 31, 2006, which is also included in interest expense. 8. Comprehensive Income (Loss)
   9. Stockholders Equity
  10. Reportable Segments
   - 11 -




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Airport Services
    
    
    Airport Parking
    
    
    District Energy
    
    
    TotalRevenue from Product SalesFuel sales
    
    $
    41,992
    
    
    $
    
    
    
    $
    
    
    
    $
    41,99241,992
    
    
    
    
    
    
    
    
    
    
    
    41,992Service RevenueOther services
    
    
    18,179
    
    
    
    
    
    
    
    845
    
    
    
    19,024Cooling capacity revenue
    
    
    
    
    
    
    
    
    
    
    4,189
    
    
    
    4,189Cooling consumption revenue
    
    
    
    
    
    
    
    
    
    
    1,475
    
    
    
    1,475Parking services
    
    
    
    
    
    
    18,216
    
    
    
    
    
    
    
    18,21618,179
    
    
    
    18,216
    
    
    
    6,509
    
    
    
    42,904Financing and Lease IncomeFinancing and equipment lease
    
    
    
    
    
    
    
    
    
    
    1,298
    
    
    
    1,298
    
    
    
    
    
    
    
    1,298
    
    
    
    1,298Total Revenue
    
    $
    60,171
    
    
    $
    18,216
    
    
    $
    7,807
    
    
    $
    86,194
  Quarter Ended March 31, 2006
    
    
    At March 31, 2006(unaudited)
    
    
    (unaudited)Property,Equipment, LandSegment
    
    
    Interest
    
    
    Depreciation/
    
    
    Capital
    
    
    and Leasehold
    
    
    TotalProfit (1)
    
    
    Expense
    
    
    Amortization(2)
    
    
    Expenditures
    
    
    Improvements
    
    
    AssetsAirport services
    
    $
    32,570
    
    
    $
    5,696
    
    
    $
    4,413
    
    
    $
    550
    
    
    $
    91,739
    
    
    $
    553,019Airport parking
    
    
    4,781
    
    
    
    3,928
    
    
    
    1,271
    
    
    
    447
    
    
    
    96,074
    
    
    
    290,419District energy
    
    
    2,542
    
    
    
    2,145
    
    
    
    1,760
    
    
    
    493
    
    
    
    146,281
    
    
    
    240,879Total
    
    $
    39,893
    
    
    $
    11,769
    
    
    $
    7,444
    
    
    $
    1,490
    
    
    $
    334,094
    
    
    $
    1,084,317
  
 (1)
    
    Segment profit includes revenue less cost of sales. For the airport parking and district
energy businesses, depreciation expense of $865,000 and $1.4 million, respectively, are
included in cost of sales for the quarter ended March 31, 2006.(2)
    
    Includes depreciation expense of property, equipment and leasehold improvements and
amortization of intangible assets. Includes depreciation expense for the airport parking and
district energy businesses which has also been included in segment profit. - 12 -




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Total assets of reportable segments
    
    $
    1,084,317Equity and cost investments:Investment in Yorkshire Link
    
    
    70,409Investment in SEW
    
    
    35,716Investment in MCG
    
    
    69,233Corporate and other
    
    
    381,256Less: Consolidation entries
    
    
    (255,071
    )Total consolidated assets
    
    $
    1,385,860
  Total reportable segment profit
    
    $
    39,893Selling, general and administrative expenses
    
    
    (23,950
    )Fees to manager
    
    
    (6,478
    )Depreciation and amortization (1)
    
    
    (5,156
    )4,309Other expense, net
    
    
    (5,700
    )Total consolidated loss before income taxes and minority interests
    
    $
    (1,391
    )
 
 (1)
    
    Does not include depreciation expense for the airport parking and district energy businesses
which are included in total reportable segment profit.  Airport Services
    
    
    Airport Parking
    
    
    District Energy
    
    
    TotalRevenue from Product SalesFuel sales
    
    $
    30,387
    
    
    $
    
    
    
    $
    
    
    
    $
    30,38730,387
    
    
    
    
    
    
    
    
    
    
    
    30,387Service RevenueOther services
    
    
    14,557
    
    
    
    
    
    
    
    643
    
    
    
    15,200Cooling capacity revenue
    
    
    
    
    
    
    
    
    
    
    4,059
    
    
    
    4,059Cooling consumption revenue
    
    
    
    
    
    
    
    
    
    
    1,438
    
    
    
    1,438Parking services
    
    
    
    
    
    
    13,309
    
    
    
    
    
    
    
    13,30914,557
    
    
    
    13,309
    
    
    
    6,140
    
    
    
    34,006Financing and Lease IncomeFinancing and equipment lease
    
    
    
    
    
    
    
    
    
    
    1,342
    
    
    
    1,342
    
    
    
    
    
    
    
    1,342
    
    
    
    1,342Total Revenue
    
    $
    44,944
    
    
    $
    13,309
    
    
    $
    7,482
    
    
    $
    65,735
 - 13 -




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##### Table of Contents



Quarter Ended March 31, 2005
    
    
    At March 31, 2005(unaudited)
    
    
    (unaudited)Property,Equipment, LandSegment
    
    
    Interest
    
    
    Depreciation/
    
    
    Capital
    
    
    and Leasehold
    
    
    TotalProfit (1)
    
    
    Expense
    
    
    Amortization(2)
    
    
    Expenditures
    
    
    Improvements
    
    
    AssetsAirport services
    
    $
    25,522
    
    
    $
    3,467
    
    
    $
    3,466
    
    
    $
    597
    
    
    $
    77,993
    
    
    $
    468,996Airport parking
    
    
    3,203
    
    
    
    2,126
    
    
    
    1,112
    
    
    
    31
    
    
    
    66,970
    
    
    
    205,494District energy
    
    
    2,659
    
    
    
    2,194
    
    
    
    1,728
    
    
    
    251
    
    
    
    150,543
    
    
    
    252,718Total
    
    $
    31,384
    
    
    $
    7,787
    
    
    $
    6,306
    
    
    $
    879
    
    
    $
    295,506
    
    
    $
    927,208
 
 
 (1)
    
    Segment profit includes revenue less cost of sales. For the airport parking and district
energy businesses, depreciation expense of $503,000 and $1.4 million, respectively, are
included in cost of sales for the quarter ended March 31, 2005.(2)
    
    Includes depreciation expense of property, equipment and leasehold improvements and
amortization of intangible assets. Includes depreciation expense for the airport parking and
district energy businesses which has also been included in segment profit.  Total assets of reportable segments
    
    $
    927,208Equity and cost investments:Investment in Yorkshire Link
    
    
    76,978Investment in SEW
    
    
    38,786Investment in MCG
    
    
    72,130Corporate and other
    
    
    366,783Less: Consolidation entries
    
    
    (238,277
    )Total consolidated assets
    
    $
    1,243,608
  Total reportable segment profit
    
    $
    31,384Selling, general and administrative expenses
    
    
    (19,162
    )Fees to manager
    
    
    (1,943
    )Depreciation and amortization (1)
    
    
    (4,412
    )5,867Other expense, net
    
    
    (5,921
    )Total consolidated loss before income taxes and minority interests
    
    $
    (54
    )
 
 (1)
    
    Does not include depreciation expense for the airport parking and district energy businesses
which are included in total reportable segment profit. 11. Related Party Transactions
 Management Services Agreement with Macquarie Infrastructure Management (USA) Inc., or MIMUSA
  - 14 -




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##### Table of Contents



Advisory and Other Services from the Macquarie Group and its Affiliates
    Related Party Loans
  Derivative Instruments and Hedging Activities
    12. Income Taxes
   - 15 -




---



##### Table of Contents



13. Legal Proceedings and Contingencies
  14. Dividends
  15. Subsequent Events
 Dividends
  Acquisitions
 International-Matex Tank Terminals
      - 16 -




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##### Table of Contents



Trajen
       Acquisition Financing Facility
  
    
    a restriction on incurring additional debt at the MIC or MIC Inc.
level prior to term loan repayment or termination of commitments; and
    
    an increase in the maximum leverage ratio to 6.8x through the end of
2006, declining to 6.1x through March 31, 2008, returning to 5.6x
upon term loan repayment or termination of commitments;
and
    
    any amounts drawn under the facility to finance the Trajen acquisition
in excess of the $180 million term loan will reduce amounts available under the
facility for working capital purposes.
 - 17 -




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##### Table of Contents



Trajen Senior Debt Financing
  Notional Principal Amount:
    
    $180 millionEffective Date:
    
    December 31, 2006Termination Date:
    
    December 12, 2010Fixed Rate:
    
    5.495%
  
 ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
   GENERAL
   - 18 -




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Tax Treatment of Distributions
   Recent and Pending Acquisitions
     - 19 -




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##### Table of Contents



RESULTS OF OPERATIONS
  
    
    38% increase in fuel revenue, due to the inclusion of the EAR acquisition and the rise
in fuel prices generally, offset by an increase in our cost of fuel. Average dollar per
gallon fuel margins continued to improve while volumes increased by approximately 2% at
existing locations;
    
    a 26% increase in service revenue, reflecting the increased activity and 8 new locations
in our parking business and the inclusion of EAR acquisition;
    
    higher management fees, including the $4.1 million performance fee earned by the manager
in the first quarter which it has elected to reinvest in shares of trust stock;
    
    the recognition of dividend income of $2.7 million in the first quarter of 2006 from
our investment in SEW, which in 2005 was received in the second quarter; and
    
    an increase in interest expense due to the overall increase in our debt to $611 million
at the end of 2005, coupled with the overall increase in interest rates during 2005.
  Quarter EndedMarch 31, 2006
    
    
    March 31, 2005
    
    
    Change$


    %RevenueRevenue from fuel sales
    
    $
    41,992
    
    
    $
    30,387
    
    
    
    11,605
    
    
    
    38.2Service revenue
    
    
    42,904
    
    
    
    34,006
    
    
    
    8,898
    
    
    
    26.2Financing and equipment lease income
    
    
    1,298
    
    
    
    1,342
    
    
    
    (44
    )
    
    
    (3.3
    )86,194
    
    
    
    65,735
    
    
    
    20,459
    
    
    
    31.1Costs and expensesCost of fuel sales
    
    
    25,269
    
    
    
    17,095
    
    
    
    8,174
    
    
    
    47.8Cost of services
    
    
    21,032
    
    
    
    17,256
    
    
    
    3,776
    
    
    
    21.9Gross profit
    
    
    39,893
    
    
    
    31,384
    
    
    
    8,509
    
    
    
    27.1Selling, general and administrative expenses
    
    
    23,950
    
    
    
    19,162
    
    
    
    4,788
    
    
    
    25.0Fees to manager
    
    
    6,478
    
    
    
    1,943
    
    
    
    4,535
    
    
    
    233.4Depreciation expense
    
    
    1,710
    
    
    
    1,327
    
    
    
    383
    
    
    
    28.9Amortization of intangibles
    
    
    3,446
    
    
    
    3,085
    
    
    
    361
    
    
    
    11.7Operating income
    
    
    4,309
    
    
    
    5,867
    
    
    
    (1,558
    )
    
    
    (26.6
    )Other income (expense)Dividend income
    
    
    2,651
    
    
    
    
    
    
    
    2,651
    
    
    
    Interest income
    
    
    1,702
    
    
    
    1,099
    
    
    
    603
    
    
    
    54.9Interest expense
    
    
    (12,339
    )
    
    
    (7,758
    )
    
    
    (4,581
    )
    
    
    59.0Equity in earnings and amortization charges of investee
    
    
    2,453
    
    
    
    1,653
    
    
    
    800
    
    
    
    48.4Other expense, net
    
    
    (167
    )
    
    
    (915
    )
    
    
    748
    
    
    
    (81.7
    )Net loss before income taxes and minority interests
    
    
    (1,391
    )
    
    
    (54
    )
    
    
    (1,337
    )
    
    
    2,475.9Income tax expense
    
    
    21
    
    
    
    
    
    
    
    21
    
    
    
    Net loss before minority interests
    
    
    (1,412
    )
    
    
    (54
    )
    
    
    (1,358
    )
    
    
    2,514.8Minority interests
    
    
    (74
    )
    
    
    29
    
    
    
    (103
    )
    
    
    (355.2
    )Net loss
    
    $
    (1,338
    )
    
    $
    (83
    )
    
    
    (1,255
    )
    
    
    1,512.0
 Gross Profit
  - 20 -




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##### Table of Contents



Selling, General and Administrative Expenses
   Other Income (Expense)
     Income Taxes
   Earnings Before Interest, Taxes, Depreciation and Amortization, or EBITDA
   Quarter EndedMarch 31, 2006
    
    
    March 31, 2005
    
    
    Change$
    
    
    %Net loss
    
    $
    (1,338
    )
    
    $
    (83
    )
    
    
    (1,255
    )
    
    
    1,512.0Interest expense, net
    
    
    10,637
    
    
    
    6,659
    
    
    
    3,978
    
    
    
    59.7Income taxes
    
    
    21
    
    
    
    
    
    
    
    21
    
    
    
    Depreciation (1)
    
    
    3,998
    
    
    
    3,221
    
    
    
    777
    
    
    
    24.1Amortization (2)
    
    
    3,446
    
    
    
    3,085
    
    
    
    361
    
    
    
    11.7EBITDA
    
    $
    16,764
    
    
    $
    12,882
    
    
    
    3,882
    
    
    
    30.1
 
 (1)
    
    Includes depreciation expense of $865,000 and $503,000 for the airport parking business for
the quarters ended March 31, 2006 -21-




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##### Table of Contents



and 2005, respectively, and $1.4 million and $1.4 million for the district energy business for
the quarters ended March 31, 2006 and 2005, respectively, which is included in the cost of
services on our consolidated condensed statement of operations.(2)
    
    Does not include $933,000 and $1.2 million of amortization expense related to intangible
assets in connection with our investment in the toll road business for the quarters ended March 31, 2006 and 2005, respectively. BUSINESS SEGMENT OPERATIONS
 Airport Services Business
   Key Factors Affecting Operating Results
 
    
    contribution of positive operating results from one FBO in Las Vegas acquired in August 2005;
    
    higher dollar per gallon fuel margins at existing locations and higher fuel volumes of approximately 2%;
    
    lower de-icing due to milder weather;
    
    continued increases in fuel prices;
    
    higher selling, general and administrative costs primarily relating to non-cash and accrued compensation expense; and
    
    higher interest costs from higher debt levels resulting from the refinancing in December 2005.
 Quarter Ended March 31, 2006 Compared to Quarter Ended March 31, 2005
 Existing Locations (NACH & MANA)
    
    
    EAR
    
    
    Total($ in thousands) (unaudited)
    
    2006
    
    
    2005
    
    
    Change
    
    
    Acquisition
    
    
    2006
    
    
    2005
    
    
    Change$
    
    
    $
    
    
    $
    
    
    %
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    %RevenuesFuel revenue
    
    
    36,382
    
    
    
    30,387
    
    
    
    5,995
    
    
    
    19.7
    
    
    
    5,610
    
    
    
    41,992
    
    
    
    30,387
    
    
    
    11,605
    
    
    
    38.2Non-fuel revenue
    
    
    14,631
    
    
    
    14,557
    
    
    
    74
    
    
    
    0.5
    
    
    
    3,548
    
    
    
    18,179
    
    
    
    14,557
    
    
    
    3,622
    
    
    
    24.9Total revenue
    
    
    51,013
    
    
    
    44,944
    
    
    
    6,069
    
    
    
    13.5
    
    
    
    9,158
    
    
    
    60,171
    
    
    
    44,944
    
    
    
    15,227
    
    
    
    33.9Cost of RevenueCost of revenue-fuel
    
    
    21,359
    
    
    
    17,095
    
    
    
    4,264
    
    
    
    24.9
    
    
    
    3,911
    
    
    
    25,270
    
    
    
    17,095
    
    
    
    8,175
    
    
    
    47.8Cost of revenue-non-fuel
    
    
    2,168
    
    
    
    2,327
    
    
    
    (159
    )
    
    
    (6.8
    )
    
    
    163
    
    
    
    2,331
    
    
    
    2,327
    
    
    
    4
    
    
    
    0.2Total cost of revenue
    
    
    23,527
    
    
    
    19,422
    
    
    
    4,105
    
    
    
    21.1
    
    
    
    4,074
    
    
    
    27,601
    
    
    
    19,422
    
    
    
    8,179
    
    
    
    42.1Fuel gross profit
    
    
    15,023
    
    
    
    13,292
    
    
    
    1,731
    
    
    
    13.0
    
    
    
    1,699
    
    
    
    16,722
    
    
    
    13,292
    
    
    
    3,430
    
    
    
    25.8Non-fuel gross profit
    
    
    12,463
    
    
    
    12,230
    
    
    
    233
    
    
    
    1.9
    
    
    
    3,385
    
    
    
    15,848
    
    
    
    12,230
    
    
    
    3,618
    
    
    
    29.6Gross Profit
    
    
    27,486
    
    
    
    25,522
    
    
    
    1,964
    
    
    
    7.7
    
    
    
    5,084
    
    
    
    32,570
    
    
    
    25,522
    
    
    
    7,048
    
    
    
    27.6Selling, general and administrative
    
    
    16,606
    
    
    
    15,204
    
    
    
    1,402
    
    
    
    9.2
    
    
    
    2,092
    
    
    
    18,698
    
    
    
    15,204
    
    
    
    3,494
    
    
    
    23.0Depreciation & amortization
    
    
    3,661
    
    
    
    3,466
    
    
    
    195
    
    
    
    5.6
    
    
    
    752
    
    
    
    4,413
    
    
    
    3,466
    
    
    
    947
    
    
    
    27.3Operating income
    
    
    7,219
    
    
    
    6,852
    
    
    
    367
    
    
    
    5.4
    
    
    
    2,240
    
    
    
    9,459
    
    
    
    6,852
    
    
    
    2,607
    
    
    
    38.0Other expense
    
    
    36
    
    
    
    923
    
    
    
    (887
    )
    
    
    (96.1
    )
    
    
    
    
    
    
    36
    
    
    
    923
    
    
    
    (887
    )
    
    
    (96.1
    )Interest expense, net
    
    
    4,405
    
    
    
    3,405
    
    
    
    1,000
    
    
    
    29.4
    
    
    
    1,184
    
    
    
    5,589
    
    
    
    3,405
    
    
    
    2,184
    
    
    
    64.1Provision for income taxes
    
    
    1,219
    
    
    
    1,143
    
    
    
    76
    
    
    
    6.6
    
    
    
    370
    
    
    
    1,589
    
    
    
    1,143
    
    
    
    446
    
    
    
    39.0
 -22-




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##### Table of Contents



Existing Locations (NACH & MANA)
    
    
    EAR
    
    
    Total($ in thousands) (unaudited)
    
    2006
    
    
    2005
    
    
    Change
    
    
    Acquisitions
    
    
    2006
    
    
    2005
    
    
    Change$
    
    
    $
    
    
    $
    
    
    %
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    %Income from Continuing Operations
    
    
    1,559
    
    
    
    1,381
    
    
    
    178
    
    
    
    12.9
    
    
    
    686
    
    
    
    2,245
    
    
    
    1,381
    
    
    
    864
    
    
    
    62.6Reconciliation of income from continuing operations to EBITDA:Income from continuing operations
    
    
    1,559
    
    
    
    1,381
    
    
    
    178
    
    
    
    12.9
    
    
    
    686
    
    
    
    2,245
    
    
    
    1,381
    
    
    
    864
    
    
    
    62.6Interest expense, net
    
    
    4,405
    
    
    
    3,405
    
    
    
    1,000
    
    
    
    29.4
    
    
    
    1,184
    
    
    
    5,589
    
    
    
    3,405
    
    
    
    2,184
    
    
    
    64.1Provision for income taxes
    
    
    1,219
    
    
    
    1,143
    
    
    
    76
    
    
    
    6.6
    
    
    
    370
    
    
    
    1,589
    
    
    
    1,143
    
    
    
    446
    
    
    
    39.0Depreciation and amortization
    
    
    3,661
    
    
    
    3,466
    
    
    
    195
    
    
    
    5.6
    
    
    
    752
    
    
    
    4,413
    
    
    
    3,466
    
    
    
    947
    
    
    
    27.3EBITDA
    
    
    10,844
    
    
    
    9,395
    
    
    
    1,449
    
    
    
    15.4
    
    
    
    2,992
    
    
    
    13,836
    
    
    
    9,395
    
    
    
    4,441
    
    
    
    47.3
 -23-




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##### Table of Contents



Revenue and Gross Profit
    
    
    inclusion of the results of EAR from the date of its acquisition;
    
    rising cost of fuel, which we pass on to customers;
    
    increases in volume of fuel sold of approximately 2%;
    
    an increase in average dollar per gallon fuel margins at existing locations, resulting
largely from a higher proportion of transient customers, which generally pay higher
margins; and
    
    reduced de-icing activity in 2006 compared to 2005 due to milder weather in the
northeast US, largely offset by increased revenue from service fees and growth in
into-plane activity.
  Operating Expenses
  
    
    increased salaries and benefits expenses due to a non-cash expense related to awarding
Stock Appreciation Rights (SARS) to several key employees during 2006 as well as the
accrual of bonuses in 2006 which had not been accrued in the prior period and to a lesser
extent annual increases in salaries and personnel;
    
    additional utilities expense recognized due to increased natural gas and electricity prices; and
    
    additional credit card fees related to increased fuel revenue.
  Other Expense
  Interest Expense, Net
   - 24 -




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##### Table of Contents



EBITDA
  
    
    increased average dollar per gallon fuel margins and increase in gallons sold;
    
    higher service fees;
    
    lower Other Expense due to GAH transaction costs incurred in 2005 offset by:
    
    lower de-icing revenues; and
    
    higher selling, general and administrative costs, predominantly related to non-cash or
accrued compensation expenses, utilities and credit card fees.
 Airport Parking Business
   
    
    the SunPark facilities located in Houston, Oklahoma City, St. Louis, Buffalo,
Philadelphia and Columbus and acquired in October 2005;
    
    the Priority facility located in Philadelphia and acquired in July 2005; and
    
    the First Choice facility located in Cleveland and acquired in October 2005.
   Key Factors Affecting Operating Results
  
    
    contribution from new locations;
    
    price increases and reduced discounting in selected markets contributed to the 7.5%
increase in average revenue per car out for comparable locations during the quarter;
    
    marketing efforts targeted at customers with a longer average stay increased average
overnight occupancy by 5.8% for comparable locations; and
    
    no growth in cars out at comparable locations.
 - 25 -




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##### Table of Contents



Quarter Ended March 31, 2006 Compared to Quarter Ended March 31, 2005
 ($ in thousands) (unaudited)
    
    Quarter Ended March 31,
    
    
    Change2006
    
    
    2005
    
    
    $
    
    
    %Revenue
    
    $
    18,216
    
    
    $
    13,309
    
    
    $
    4,907
    
    
    
    36.9Direct expenses
    
    
    13,435
    
    
    
    10,106
    
    
    
    3,329
    
    
    
    32.9Gross profit
    
    
    4,781
    
    
    
    3,203
    
    
    
    1,578
    
    
    
    49.3Selling, general and administrative expenses
    
    
    1,700
    
    
    
    955
    
    
    
    745
    
    
    
    78.0Amortization of intangibles
    
    
    406
    
    
    
    609
    
    
    
    (203
    )
    
    
    (33.3
    )Operating income
    
    
    2,675
    
    
    
    1,639
    
    
    
    1,036
    
    
    
    63.2Interest expense, net
    
    
    (3,921
    )
    
    
    (2,114
    )
    
    
    (1,807
    )
    
    
    85.5Other expense
    
    
    (92
    )
    
    
    (25
    )
    
    
    (67
    )
    
    
    268.0Benefit for income taxes
    
    
    462
    
    
    
    
    
    
    
    462
    
    
    
    Minority interest in loss of consolidated subsidiaries
    
    
    205
    
    
    
    88
    
    
    
    117
    
    
    
    133.0Net loss
    
    $
    (671
    )
    
    $
    (412
    )
    
    $
    (259
    )
    
    
    62.9Reconciliation of net loss to EBITDANet loss
    
    
    (671
    )
    
    
    (412
    )
    
    
    (259
    )
    
    
    62.9Interest expense, net
    
    
    3,921
    
    
    
    2,114
    
    
    
    1,807
    
    
    
    85.5Benefit for income taxes
    
    
    (462
    )
    
    
    
    
    
    
    (462
    )
    
    
    Depreciation
    
    
    865
    
    
    
    503
    
    
    
    362
    
    
    
    72.0Amortization of intangibles
    
    
    406
    
    
    
    609
    
    
    
    (203
    )
    
    
    (33.3
    )EBITDA
    
    $
    4,059
    
    
    $
    2,814
    
    
    $
    1,245
    
    
    
    44.2
 - 26 -




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##### Table of Contents



Quarter Ended March 31,2006
    
    
    2005Operating Data:Total Revenues (000s)(1):New locations
    
    $
    4,225
    
    
    $
    243Comparable locations
    
    $
    13,991
    
    
    $
    13,066Comparable locations increase
    
    
    7.1
    %Gross Profit Margin:New locations
    
    
    28.71
    %
    
    
    15.77
    %Comparable locations
    
    
    25.55
    %
    
    
    24.60
    %Comparable locations increase
    
    
    0.95
    %Parking Revenues (000s)(2):New locations
    
    $
    4,167
    
    
    $
    243Comparable locations
    
    $
    13,478
    
    
    $
    12,646Comparable locations increase
    
    
    6.6
    %Cars Out(3):New locations
    
    
    162,392
    
    
    
    6,021Comparable locations
    
    
    355,443
    
    
    
    358,520Comparable locations decrease
    
    
    (0.9
    %)Average Revenue per Car Out:New locations
    
    $
    25.66
    
    
    $
    40.42Comparable locations
    
    $
    37.92
    
    
    $
    35.27Comparable locations increase
    
    
    7.5
    %Average Overnight Occupancy(4)New locations
    
    
    5,900
    
    
    
    309Comparable locations
    
    
    15,081
    
    
    
    14,258Comparable locations increase
    
    
    5.8
    %Locations:New locations
    
    
    8Comparable locations
    
    
    22
 
 (1)
    
    Total Revenues include revenues from all sources, including parking revenues, and
non-parking revenues such as those derived from transportation services and rental of
premises.(2)
    
    Parking Revenues include all receipts from parking related revenue streams, which
includes monthly, membership, and third party distribution companies.(3)
    
    Cars Out refers to the total number of customers exiting during the period.(4)
    
    Average Overnight Occupancy refers to aggregate average daily occupancy measured
for all locations at the lowest point of the day and does not reflect turnover and intra-day
activity. Revenue
     - 27 -




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##### Table of Contents



Direct Expenses
    Selling, General and Administrative Expenses
  
    
    payroll costs associated with the expansion of the management team to support additional
locations and the retirement of two members of senior management from the business; and
    
    legal expenses greater than historical levels primarily related to the acquisition of new
locations and scheduled union negotiations.
 Amortization of Intangibles
  Interest Expense, Net
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##### Table of Contents



EBITDA
   
    
    increasing prices and reducing discounting at locations with strong demand or improved levels of customer service;
    
    standardizing staff scheduling to minimize overtime; and
    
    negotiating bulk purchase discounts on fuel and other parking supplies.
 District Energy Business
  Key Factors Affecting Operating Results
  
    
    capacity revenue generally increased in-line with inflation after excluding a one-time
credit to a customer in the first quarter of 2005; and
    
    earlier timing of pre-season maintenance expense for system reliability compared to the
prior year.
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##### Table of Contents



Quarter Ended March 31, 2006 Compared to Quarter Ended March 31, 2005
 ($ in thousands) (unaudited)
    
    Quarter Ended March 31,2006
    
    
    2005
    
    
    Change$
    
    
    $
    
    
    $
    
    
    %Cooling capacity revenue
    
    
    4,189
    
    
    
    4,059
    
    
    
    130
    
    
    
    3.2Cooling consumption revenue
    
    
    1,475
    
    
    
    1,438
    
    
    
    37
    
    
    
    2.6Other revenue
    
    
    845
    
    
    
    643
    
    
    
    202
    
    
    
    31.4Finance lease revenue
    
    
    1,298
    
    
    
    1,342
    
    
    
    (44
    )
    
    
    (3.3
    )Total revenue
    
    
    7,807
    
    
    
    7,482
    
    
    
    325
    
    
    
    4.3Direct expenses  electricity
    
    
    944
    
    
    
    1,023
    
    
    
    (79
    )
    
    
    (7.7
    )Direct expenses  other (1)
    
    
    4,321
    
    
    
    3,800
    
    
    
    521
    
    
    
    13.7Direct expenses  total
    
    
    5,265
    
    
    
    4,823
    
    
    
    442
    
    
    
    9.2Gross profit
    
    
    2,542
    
    
    
    2,659
    
    
    
    (117
    )
    
    
    (4.4
    )Selling, general and administrative expenses
    
    
    797
    
    
    
    857
    
    
    
    (60
    )
    
    
    (7.0
    )Amortization of intangibles
    
    
    337
    
    
    
    337
    
    
    
    
    
    
    
    Operating income
    
    
    1,408
    
    
    
    1,465
    
    
    
    (57
    )
    
    
    (3.9
    )Interest expense, net
    
    
    (2,070
    )
    
    
    (2,142
    )
    
    
    72
    
    
    
    (3.4
    )Other income (expense)
    
    
    (79
    )
    
    
    32
    
    
    
    (111
    )
    
    
    (346.9
    )Benefit for income taxes
    
    
    333
    
    
    
    
    
    
    
    333
    
    
    
    Minority interest
    
    
    (131
    )
    
    
    (117
    )
    
    
    (14
    )
    
    
    12.0Net loss
    
    
    (539
    )
    
    
    (762
    )
    
    
    223
    
    
    
    (29.3
    )Reconciliation
of net loss to EBITDANet loss
    
    
    (539
    )
    
    
    (762
    )
    
    
    223
    
    
    
    (29.3
    )Interest expense, net
    
    
    2,070
    
    
    
    2,142
    
    
    
    (72
    )
    
    
    (3.4
    )Benefit for income taxes
    
    
    (333
    )
    
    
    
    
    
    
    (333
    )
    
    
    Depreciation
    
    
    1,423
    
    
    
    1,391
    
    
    
    32
    
    
    
    2.3Amortization of intangibles
    
    
    337
    
    
    
    337
    
    
    
    
    
    
    
    EBITDA
    
    
    2,958
    
    
    
    3,108
    
    
    
    (150
    )
    
    
    (4.8
    )
 
 (1)
    
    Includes depreciation expense of $1.4 million for the quarters ended March 31, 2006 and March
31, 2005, respectively. Gross Profit
  Selling, General and Administrative Expenses
  Interest Expense, Net
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##### Table of Contents



Benefit For Income Taxes
  EBITDA
  Toll Road Business
  
    
    our equity in the earnings of Connect M1-A1 Holdings Limited, or CHL, which we hold
through MYL, net of amortization expense; and
    
    net interest income resulting from loans between us and a subsidiary of CHL.
 Quarter Ended March 31, 2006 Compared to Quarter Ended March 31, 2005
 ($ in thousands) (unaudited)
    
    Quarter Ended March 31,2006
    
    
    2005
    
    
    Change$
    
    
    
    $
    
    
    
    $
    
    
    
    
    %Equity in earnings of investee
    
    
    3,386
    
    
    
    2,852
    
    
    
    534
    
    
    
    18.7Amortization
    
    
    (933
    )
    
    
    (1,199
    )
    
    
    266
    
    
    
    (22.2
    )Equity in earnings and
amortization of investee
    
    
    2,453
    
    
    
    1,653
    
    
    
    800
    
    
    
    48.4
    Investments
 Macquarie Communications Infrastructure Group, or MCG
  - 31 -




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##### Table of Contents



South East Water, or SEW
  LIQUIDITY AND CAPITAL RESOURCES
  
    
    all of our businesses and investments generate, and will continue to generate, significant operating cash flow;
    
    the ongoing maintenance capital expenditures associated with our businesses are modest and readily funded from their
respective operating cash flow;
    
    all significant short-term growth capital expenditure will be funded with cash on hand or from committed undrawn debt
facilities;
    
    CHLs amortizing debt can be paid from operating cash flow;
    
    we can refinance or extend the Macquarie Parking debt facility at its initial maturity in 2006;
    
    payments on Thermal Chicago/Northwind Aladdins debt that will begin to amortize in 2007 can be paid from operating cash
flow;
    
    we will be able to raise equity to refinance amounts borrowed under our revolving credit facility prior to its maturity; and
    
    following an equity refinancing, we will have $300 million of revolving financing.
  Our Consolidated Cash Flow
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##### Table of Contents



Quarter Ended
    
    Quarter Ended($ in thousands)
    
    March 31, 2006
    
    March 31, 2005
    
    ChangeCash provided by operations
    
    $
    11,821
    
    
    $
    9,760
    
    
    
    21.1
    %Cash used in investing activities
    
    $
    (1,023
    )
    
    $
    (49,831
    )
    
    
    (97.9
    %
    )Cash provided by financing activities
    
    $
    552
    
    
    $
    27,039
    
    
    
    (98.0
    %)
  Airport Services Business Cash Flow
 Quarter
    
    QuarterEnded
    
    EndedMarch 31,
    
    March 31,($ in thousands)
    
    2006
    
    2005Cash provided by operations
    
    $
    9,513
    
    
    $
    4,154Cash used in investing activities
    
    $
    (567
    )
    
    $
    (50,606
    )Cash (used in) provided by financing activities
    
    $
    (9,153
    )
    
    $
    50,683
  
    
    the acquisition of EAR in August 2005 that has increased cash flow in the first quarter
of 2006 compared to the first quarter of 2005;
    
    improved performance at existing locations;
    
    an increase in interest expense reflecting higher debt levels;
    
    capital expenditures in 2006 of $550,000 that were substantially unchanged from 2005,
and included $496,000 for maintenance and $54,000 for expansion;
    
    distributions to MIC of $8.9 million in 2006 compared to none in 2005; and
    
    the acquisition in the first quarter of 2005 of GAH and related proceeds received from
the issuance of long term debt and a capital contribution from MIC in January 2005.
  
    
    In connection with our pending acquisition of Trajen, we expect to incur additional debt
through an expansion of our existing NACH credit facility. See Note 15, Subsequent Events,
to the consolidated condensed financial statements in Part I, Item I of this Form 10-Q for
more information.
 - 33 -




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##### Table of Contents



Airport Parking Business Cash Flow
 Quarter
    
    QuarterEnded
    
    EndedMarch 31,
    
    March 31,($ in thousands)
    
    2006
    
    2005Cash provided by operations
    
    $
    952
    
    
    $
    1,647Cash used in investing activities
    
    $
    (480
    )
    
    $
    (20
    )Cash used in financing activities
    
    $
    (3,606
    )
    
    $
    (91
    )
  
    
    increase in interest expense due to new debt incurred to finance the
acquisitions in October 2005 and higher interest rates that reached our caps in the first
quarter of 2006;
    
    increase in working capital usage of $241,000, primarily relating to increase in trade and other receivables of $171,000;
    
    capital expenditures in 2006 of $480,000 compared to $20,000 in 2005;
    
    partial repayment in 2006 of the intercompany loan from MIC Inc. of $3.2 million; and
    
    capital lease obligation payments in 2006 of $374,000.
  District Energy Business Cash Flow
 Quarter
    
    QuarterEnded
    
    EndedMarch 31,
    
    March 31,($ in thousands)
    
    2006
    
    2005Cash provided by operations
    
    $
    445
    
    
    $
    1,409Cash used in investing activities
    
    $
    (350
    )
    
    $
    (251
    )Cash used in financing activities
    
    $
    (2,839
    )
    
    $
    
  
    
    working capital usage reflecting timing of trade receivables and payment of accrued expenses;
    
    increase in cash used due to the timing of on-going maintenance capital expenditures for system reliability;
    
    dividend distributions of $4.1 million in 2006 compared to none in 2005; and
    
    additional borrowings in 2006 of $1.3 million to finance capital expenditures.
  
    
    debt service ratio at March 31, 2006:                                                   2.05 : 1
    
    drawdown of revolving credit facility as of March 31, 2006:           $2.1 million
 Toll Road Business
  - 34 -




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##### Table of Contents



Subordinated Loans
  Interest
    
    £1.01 millionRedemption premium
    
    NilPrincipal
    
    £0.2 millionTotal
    
    £1.21 million
 Dividends
  Connect M1-A1 Limiteds Senior Debt
   Investments in MCG and SEW
  Capital Expenditures
  - 35 -




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##### Table of Contents



Airport Services Business
 Maintenance Capital Expenditure
  Specific Capital Expenditure
  Estimated Cost/AmountRemaining (fromLocation
    
    Item
    
    Expected Timing
    
    December 31, 2005)Teterboro Airport
    
    Ramp construction
    
    Commencing second quarter 2006
    
    $4.5 millionMetroport East 34th
Street
Heliport
    
    Upgrade of heliport
in exchange for
ten-year operating
agreement
    
    Commencing third quarter 2006
    
    $2.8 millionPittsburgh
International Airport
    
    Original lease
requires further
capital
expenditure. This
will be fulfilled
through the
development of a
new hangar.
    
    Commencing by June 2006
    
    $5.1 million
 Airport Parking Business
 Maintenance Capital Expenditure
   Specific Capital Expenditure
   District Energy Business
   - 36 -




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##### Table of Contents



Toll Road Business
 Maintenance Capital Expenditure
  Commitments and Contingencies
   
 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
  
 ITEM 4. CONTROLS AND PROCEDURES
   
 PART II. OTHER INFORMATION
 
 ITEM 1. LEGAL PROCEEDINGS
  
 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
 Unregistered Sales of Equity Securities
  
 ITEM 3. DEFAULTS UPON SENIOR SECURITIES
  - 37 -




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##### Table of Contents



ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
 ITEM 5. OTHER INFORMATION
  
 ITEM 6. EXHIBITS
  - 38 -




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##### Table of Contents



SIGNATURES
  Macquarie Infrastructure Company TrustDated: May 10, 2006
    By:
    /s/ Peter StokesName:
    Peter StokesTitle:
    Regular Trustee  Macquarie Infrastructure Company LLCDated: May 10, 2006
    By:
    /s/ Peter StokesName:
    Peter StokesTitle:
    Chief Executive Officer Macquarie Infrastructure Company LLCDated: May 10, 2006
    By:
    /s/ David MitchellName:
    David MitchellTitle:
    Chief Financial Officer - 39 -




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description2.1
    
    Purchase and Sale Agreement dated April 18, 2006 by and among Trajen
Holdings, Inc., the stockholders thereof and Macquarie FBO Holdings,
LLC.2.2
    
    Stock Subscription Agreement dated April 14, 2006 between Macquarie
Terminal Holdings LLC, IMTT Holdings Inc. and the Current Owners
(incorporated by reference to Exhibit 2.1 of the Registrants
Current Report on Form 8-K, filed with the SEC on April 17, 2006
(the April Current Report)).10.1
    
    Shareholders Agreement dated April 14, 2006 between Macquarie
Terminal Holdings LLC, IMTT Holdings Inc., the Current Shareholders
and the Current Beneficial Owners named therein (incorporated by
reference to Exhibit 2.2 of the April Current Report).10.2
    
    Amended and Restated Credit Agreement dated as of May 9, 2006 among
Macquarie Infrastructure Company Inc., Macquarie Infrastructure
Company LLC, the Lenders and Issuers party thereto and Citicorp
North America, Inc., as Administrative Agent.10.3
    
    Commitments letters relating to an increase in the Senior Credit
Facility of North America Capital Holding Company.31.1
    
    Rule 13a-14(a)/15d-14(a) Certification of the Chief Executive Officer31.2
    
    Rule 13a-14(a)/15d-14(a) Certification of the Chief Financial Officer32.1
    
    Section 1350 Certification of the Chief Executive Officer32.2
    
    Section 1350 Certification of the Chief Financial Officer99.1
    
    Earnings release related to the quarter ended March 31, 2006
 - 40 -