Wrap Text
BIACSA-Airports Company South Africa Report for 2018 Financial Year Performance Highlights
Airports Company South Africa SOC Limited
(Incorporated in the Republic of South Africa)
(Registration number 1993/004149/30)
Issuer Code: BIACSA
AIRPORTS COMPANY SOUTH AFRICA REPORT FOR 2018 FINANCIAL YEAR
PERFORMANCE HIGHLIGHTS
- Solid revenue and profit performance in spite of 35.5% cut in
aeronautical charges
- Revenue of R6.9bn and EBITDA of R3bn
- Interest-bearing borrowing reduced by R490m to R8.8bn
JOHANNESBURG 27 September 2018 - Airports Company South Africa
absorbed a 35.5% reduction in aeronautical charges to report
revenue of R6.9-billion and EBITDA of R3-billion in the year
ended 31 March 2018.
The effect of the tariff reduction was mitigated by strong
passenger growth at Cape Town International and King Shaka
International airports that was above expectations, strong cost
containment, improvements from operations outside South Africa and
appreciation in the investment property portfolio.
These factors saw revenue and profit decline by 20% and 58%
respectively.
The company still maintains a very strong balance sheet as a result
of conservative financial management practices. Interest-bearing
debt was reduced further by R490-million during the
year, reducing the company's gearing ratio to only 22%.
Bongani Maseko, Chief Executive Officer of Airports Company South
Africa, said plans to mitigate the impact of significantly lower
tariffs had largely been effective.
"We did have some time to plan for lower tariffs, but these plans
had to be firmly managed while coping with only moderate domestic
passenger growth.
"Our performance shows resilience and a capacity to adapt to very
different operating conditions. This is due to the commitment of
all employees in staying true to our strategy and
operating model," said Maseko.
The performance of international investments showed considerable
improvement with Mumbai making a positive contribution while
losses associated with Guarulhos International Airport in
Brazil were reduced by R481-million.
Capital expenditure remained at maintenance capital expenditure
levels, as in the prior year.
The decline to 4.2% in return on equity was largely expected on
the back of the reduction in aeronautical charges.
Focused expenditure management led to lower than CPI growth in
staff costs and utilities. Repairs and maintenance costs increased
by 17%. This was due to ageing infrastructure, a result of
postponed capital expenditure as a result of previous delays to
the tariff permission decision.
"We are pleased to have been able to keep a firm hold on costs in
spite of severe pressure on utilities such as electricity and
water," said Maseko.
Aircraft landing volumes grew by 1% for domestic flights and by 3%
for international flights. The Company reported a total of 20.2-
million (2017: 19.3-million) departing passengers from
the nine airports it owns and operates.
Domestic passenger growth was 4% with good growth of 5% in
international departing passengers. This was largely due to the
successes of the air access initiatives for Cape Town
International Airport and King Shaka International Airport.
Said Maseko: "These successes demonstrate the tremendous value of
collaboration between an airport and all of the stakeholders in
its area.
"We are therefore pleased that similar efforts are underway for O.
R. Tambo International Airport and Port Elizabeth International
Airport. The great potential of air access initiatives
has been demonstrated. We hope that our stakeholders in other areas
will bring the same levels of drive and commitment to repeating
these successes around South Africa."
The 35.5% tariff reduction saw the contribution of aeronautical
revenue to the total fall to 51% from 63% the previous year. The
Company continues to implement activities to grow the size
of non-aeronautical revenue which remains dependent on overall
economic activity. Non-aeronautical revenue is derived from
sources such as retail, advertising and car rental concessions,
office rental, vehicle parking and car hire.
Maseko said the company remains firmly committed to transformation
through procurement and the awarding of airport concessions.
"We continue to seek clarity on how we apply government's national
transformation directives. In some instances, this requires us to
defend ourselves in litigation to the fullest extent that judicial
system will allow. However, we remain equally committed to working
within the provisions of the law and the Constitution," he said.
Maseko expects construction on the Cape Town runway realignment
project to commence during 2019 and to take about three years to
complete. The company also plans significant infrastructure
investment at O. R. Tambo International Airport that will make a
significant contribution to the development of the aerotropolis
concept in the Ekurhuleni region.
The 25th Annual General Meeting (“AGM”) is scheduled to take place
on 12 October 2018.
ENDS
Media enquiries:
Nolly Ntlakana, FTI Consulting
+27 (0) 11 214 2412 T
+27 (0) 71 865 2543 M
nolly.ntlakana@fticonsulting.com
Notes to editors about Airports Company South Africa
Airports Company South Africa is the largest airport operator in
Africa. Our mission is to develop and manage world-class airport
infrastructure for the benefit of all stakeholders
We manage South Africa's nine principal airports.* In fulfilling
this task, Airports Company South Africa enables more than 80
percent of South Africa's commercial air travel. Our airports
process 40 million arriving and departing passengers a year.
In the 2016/17 financial year, Airports Company South Africa
reported total revenue of R8.6 billion. Currently 63% of Airports
Company South Africa revenue is derived from regulated
tariffs for aircraft landing and parking fees and a passenger
service charge. The remaining 37% is non-aeronautical revenue
generated by airport retail, parking, property and other
services.
Airports Company South Africa's global footprint extends to
technical advisory services and support, airport management, and
operating concessions in India, Brazil, Munich, and Ghana.
We also frequently feature among the winners of independently-
judged global airport awards. In the 2017 Airports Service Quality
awards presented by Airports Council International no less
than four of our airports were honoured:
- King Shaka International Airport achieved first place in Best
Airport by Region;
- Cape Town International Airport achieved third place in Best
Airport by Region;
- Cape Town International Airport was named Best Airport in Africa
(over 20 000 air traffic movements) in the Safety Awards;
- Bram Fischer International Airport achieved first place in Best
Airport by Region in the under 2 million passengers category as
well as Most Improved Airport; and
- Upington International Airport joined the 2016 Director's Roll
of Excellence for being ranked in the top five airports for its
category, size and region from 2006 to 2015.
For more information please visit www.airports.co.za.
*South African airports we operate are: O. R. Tambo International
Airport, Cape Town International Airport, King Shaka International
Airport, George Airport, Bram Fischer International
Airport, Upington Airport, Kimberley Airport, Port Elizabeth
Airport and East London Airport.
Johannesburg
27 September 2018
Debt Sponsor
The Standard Bank of South Africa Limited
Date: 27/09/2018 04:24:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Sharenet Sites 
