FRAPORT: Successful performance in 2014 driven by traffic growth – focus on quality
The Fraport Group’s international portfolio also saw positive growth in 2014, thanks particularly to the successful bid for Ljubljana Airport (LJU) in Slovenia’s capital and the acquisition of U.S.-based AMU Holdings Inc. (also known as Airmall). AMU is responsible for managing and marketing retail malls at four U.S. airports. This acquisition signals Fraport’s entry to the American market, offering the Group the opportunity to expand its activities in other areas of the airport business in the U.S. Elsewhere in Fraport’s international portfolio, the new terminals opened at Varna (VAR) and Burgas (BOJ) in Bulgaria and at St. Petersburg (LED) in Russia have been smoothly integrated into airport operations and have been very well received by passengers. Other Group airports – including Lima (LIM) in Peru, Antalya (AYT) on the Turkish Riviera, Xi’an (XIY) in central China, and Hanover (HAJ) in northern Germany – also performed well in 2014 and in some cases recorded double-digit growth.
Fraport AG’s positive financial performance in 2014 was mainly driven by passenger growth. While the Group’s underlying revenue increased by more than three percent to €2.38 billion, the operating result or EBITDA (earnings before interest, tax, depreciation and amortization) improved by almost eight percent to more than €790 million. The increase in EBITDA can be attributed to lower expenses for Winter Services as well as energy and supply services at FRA, overall efficient cost management, and the positive performance of the Group’s international business. The Group result advanced about seven percent to almost €252 million. Fraport’s free cash flow grew by more than €210 million to €247 million. Commenting on the Group’s positive business performance and the proposed dividend increase, Schulte said: “We have fully reached our growth targets set for the 2014 fiscal year. Because of this very satisfying performance, Fraport AG’s executive and supervisory boards have recommended that the dividend be increased to €1.35 per share.” The last dividend increase was for fiscal year 2010.
Competition among international aviation hubs requires airports to increasingly offer high service quality as well as leading-edge facilities and infrastructure. Schulte explained that FRA has launched a range of new services and is making ongoing investments in existing facilities. Moreover, the construction of the new Terminal 3 is a prerequisite for creating the necessary future capacities to maintain Frankfurt Airport’s high quality standards. Schulte said: “According to all available forecasts, by 2030 passenger numbers in Germany are expected to rise by between two and three percent per year. At Frankfurt Airport, passenger figures will increase in a similar range – as confirmed by two independent research institutes. Thus, we expect to serve between 68 million and 73 million passengers at FRA around the year 2021. This would clearly exceed our current capacities.” An intensive internal assessment conducted by Fraport also confirmed the need for an additional terminal to accommodate the forecast growth in passenger traffic. By successfully completing the construction of Terminal 3 (first phase) on schedule and on budget, Fraport will contribute to strengthening FRA’s position as Germany’s largest airport and biggest employment complex at a single location, as well as the state of Hesse’s global gateway.
CEO Schulte also confirmed the company’s comprehensive commitment to noise abatement, underlining that Fraport will not relent in its ongoing efforts to further minimize the airport’s noise footprint in the coming years. “We will continue to play a pioneering role internationally in the field of noise abatement,” emphasized Schulte.
The overall positive performance achieved in 2014 has been continuing in 2015. In line with Frankfurt’s forecast traffic growth of between two and three percent, passenger figures even rose by more than four percent in the first four months of 2015. FRA registered a new April record in 2015 – surpassing the five million passenger mark for the first time in an April month. Fraport also expects the Group’s financial performance to continue its positive trend in 2015, despite a difficult environment. While Group EBITDA is expected to reach between about €820 million and €840 million, Group EBIT is forecast to grow to between about €500 million and €520 million. Also the Group result is expected to rise again, to between about €265 million and €285 million.
MEDIA CONTACT: Fraport AG Frankfurt Airport Services Worldwide, Robert A. Payne, B.A.A. – International Spokesman and Head of International Press/PR & External Activities Team, Press Office (UKM-PS), Corporate Communications, 60547 Frankfurt, Germany; Tel.: +49 69.690.78547; E-mail: email@example.com ; Internet: www.fraport.com