Airports Company South Africa posts solid financial performance for the year ended 31-Mar-2010

Speaking at the release of the Group financial results, ACSA Finance Director Ms Priscillah Mabelane, said the solid set of results was achieved amid a decline in consolidated passenger numbers by 1,7% to 33 million, construction inflationary pressures and increases in borrowing costs in the first 9 months of the year.

Notwithstanding, she added, revenue grew by 12% to R3,5 billion, with the non-aeronautical revenue component (retail, advertising, parking, car rental, property and consultancy) rising by 7% to R1,83 billion, and normalised earnings before interest, tax, depreciation and amortisation (EBITDA) rising by 6% to R1,85 billion. Effective operational cost management also contributed positively to the earnings.

Passenger and aircraft traffic movements (ATMs) indicated a decline in numbers for the financial year under review, as compared to the previous year's performance. Consolidated figures declined by 1,7% in passenger traffic and 1,7% in aircraft movements.

Domestic passenger traffic declined by 2,1%, regional traffic grew by 1,3% and international passenger numbers declined by 0,9%. The strong low-cost carrier market continued its momentum, resulting in a growth of 3%, whilst the full service carrier market declined by 4%. An upward trend was evidenced during the latter part of the financial year, reflecting a positive growth of 4,2% during the last quarter's performance. Domestic passenger traffic comprised 70% of the segmented market, regional 3%, with the international share equaling 27%.

Compared to the previous financial year, domestic ATMs recorded a 3,6% decline, while regional and international performance reflected positive growth of 6,8% and 3,3% respectively. Unscheduled movements, which comprised 33% of the total ATMs, declined by 1,7%.

ACSA Managing Director, Ms Monhla Hlahla said the year under review also marked the completion of the R17 billion infrastructure programme, particularly characterised by the commissioning of the Central Terminal Buildings at Cape Town and O.R. Tambo International Airports, and the approaching completion of the R6,8 billion King Shaka International. The Group managed to raise all the funding required to support the infrastructure development programme successfully.

"These solid results and the accomplishment of our key strategic imperatives for the year - submission of tariff application, the commissioning of newly developed infrastructure and the finalisation of the World Cup operational plans - is a testament to the ACSA team's agility and resilience to manoeuvre through a difficult operating environment," Hlahla added.

An ongoing focus was placed on resolving the key matter of regulation policy whilst ensuring maximisation of commercial revenues. The recent appointment of a ministerial advisory committee is a positive step and ACSA looks forward to participating in the process of ensuring a fair and transparent outcome of the 2011-2015 Permission, and an enabling regulatory regime into the future.

Operational planning and preparations for the 2010 FIFA World Cup received the highest priority in the year under review. This once-in-a-lifetime opportunity was planned for through the successful co-ordination and efforts of multiple partners and stakeholders. These ranged across a broad spectrum from government departments, to security services, host city committees and multiple on-airport goods and services providers. We are especially pleased with the interest shown in the experience we gained by Brazil and the Ukraine to assist them with their forthcoming major events.

Hlahla points out that, looking forward, ACSA is placing emphasis on effective utilisation of the newly built infrastructure - sweating the assets - whilst at the same time developing a robust air traffic growth strategy in partnership with key stakeholders.

ACSA has gained invaluable experience in the development, and the readiness and testing requirements for commissioning a brand new, greenfield airport, as well as the decommissioning of Durban International. Additional skills gained through the management of major construction and its effects at operational airports, and the four years of airport management at Mumbai International, have equipped ACSA with a unique set of marketable skills. As with Brazil and the Ukraine, ACSA looks forward to the world tapping into its key lessons.

These skills and expertise will no doubt be leveraged to take advantage of concession, management and consultancy opportunities at airports across Africa and the world.

"I am pleased and very proud of this highly dedicated team, which rises up every single day to ensure that ACSA is the model, successful state-owned company it is today," Hlahla concluded.