Fraport reports FY 2016 financial results

Fraport AG has reported a successful 2016 business year (ending December 31), marked by a record financial result achieved despite challenging framework conditions for the aviation industry and slightly declining traffic at the Group´s Frankfurt Airport home base, the company said.

Group revenue declined by 0.5% year-on-year to EUR 2.59bn. Adjusting for changes in the scope of consolidation due to the sale of shares in Fraport Cargo Services (FCS) and the disposal of the Air-Transport IT Services subsidiary, Group revenue would have risen by EUR 46.2m or 1.8%. This resulting increase in revenue (on an adjusted basis) was stimulated in particular by the ongoing growth at the Group´s airports in Lima (Peru) and Varna and Burgas (Bulgaria), as well as at the Fraport USA subsidiary, and by revenue gained from property sales.

The Group´s operating profit or EBITDA advanced by 24.2%, reaching a new record high of EUR 1.05bn. This strong growth was supported by the compensation payment received for the Manila terminal project, which boosted EBITDA by EUR 198.8m. Fraport´s successful sale of a 10.5% share in Thalita Trading Ltd., the owner of the operating company of Pulkovo Airport in St. Petersburg (Russia), contributed another EUR 40.1m to EBITDA.

Adjusting for these effects and the creation of provisions for a personnel-restructuring program, the Group´s EBITDA would have remained on the previous year´s level of about EUR 853m. Although this adjusted EBITDA was curbed by previous year´s weaker traffic performance and a slowdown in FRA´s retail business, reflecting lower spending by passengers, the Group´s external business also had a compensating positive effect on EBITDA.

The Group result (net profit) increased by 34.8% to EUR 400.3m. Without the aforementioned effects and unscheduled depreciation and amortization, Fraport´s Group result would only have reached about EUR 296m. In contrast, operating cash flow declined by 10.6% to EUR 583.2m. Likewise, free cash flow contracted by 23.3% to EUR 301.7m, also due to ongoing construction of Frankfurt Airport´s future Terminal 3.

Traffic at the company´s Frankfurt Airport (FRA) home-base slightly declined by 0.4% to approximately 61 million passengers in 2016. This was, in particular, a result of the relatively weak spring and summer months characterized by markedly restrained travel bookings in the wake of geopolitical uncertainties. In the last quarter of 2016, traffic figures noticeably rebounded, even reaching a new December monthly record. Cargo tonnage expanded by 1.8% to some 2.1 million metric tons, helped by the economic recovery in summer 2016.

Fraport´s international portfolio of airports displayed mixed results in 2016. The strong 30.9% decline in traffic at Antalya Airport (AYT) in Turkey – which was impacted by the country´s geopolitical and security situation – could be largely offset by the traffic performance of Group airports at other locations. Strong growth was recorded in particular at Lima Airport (LIM) in Peru (up 10.1%), Burgas Airport (BOJ) and Varna Airport (VAR) on the Bulgarian Black Sea coast (up 22.0% and 20.8%, respectively), and Xi´an Airport (XIY) in China (up 12.2%).

Fraport AG is the the owner and manager of Frankfurt Airport.