- Airline passenger traffic recovery leads to strong revenue growth in first 9 months of 2021.
- Demand for holiday travel during the summer months was relatively strong.
- The result has improved due to financial compensation received for pandemic-related losses incurred at various Group airports.
The Fraport global airport company achieved a significant increase in revenue and the Group result (net profit) during both the third quarter and the first nine months (ended September 30) of the 2021 business year. Factors contributing to this increase included a positive operational performance and several one-off effects. Forecasts for the upcoming winter season are also optimistic. Therefore, Fraport has revised its full-year outlook for revenue and other key financial figures slightly upwards. Traffic development at Frankfurt Airport is forecast to reach the upper area of the expected performance range, between under 20 million to 25 million passengers.
Fraport CEO, Dr. Stefan Schulte, explained: “Following the massive losses experienced in 2020 and the resulting sharp rise in debt, we are now seeing brighter prospects ahead. Demand for holiday travel during the summer months was relatively strong. Moreover, our result has improved due to financial compensation received for pandemic-related losses incurred at various Group airports. Now, we are also expecting intercontinental traffic to gradually recover – supported by the recent re-opening of the U.S. borders. Consequently, we are a bit more optimistic about the winter season than we were just a few months ago. Nevertheless, it is still a long way ahead until we reach pre-pandemic passenger levels again and are able to reduce our debt significantly.”
Third quarter: revenue and net profit grow strongly
Boosted by a noticeable recovery in holiday travel during the summer season, revenue soared in the third quarter of 2021 by 79.5 percent to €633.8 million compared to €353.1 million in the same quarter in 2020 (both values have been adjusted for IFRIC 12 related contract revenue from construction and expansion measures at Fraport’s subsidiaries worldwide). EBITDA rose to €288.6 million in the third quarter, up from minus €250.3 million in Q3/2020. However, this gain also reflects a number of one-off effects: In the third quarter of 2020, earnings were negatively impacted by the creation of provisions for personnel-reduction measures totaling €279.5 million. This year, in turn, a positive contribution in the third quarter came from COVID-related compensation to our subsidiaries in the U.S., Slovenia and Greece – which boosted the Group’s “Other Income” by some €30 million. Adjusting for these one-off effects, Fraport still posted strong EBITDA growth of 785.6 percent to €258.6 million in the third quarter of 2021, versus €29.2 million in the same period last year. The Group result – or net profit – grew to €102.6 million in Q3/2021 (including the aforementioned one-off effects), compared to minus €305.8 million in Q3/2020.
First nine months of 2021: Fraport achieves solid operating result, supported by positive one-off effects
During the first nine months of the current year, Group revenue rose by 18.3 percent year-on-year to nearly €1.4 billion (excluding IFRIC 12 effects). Along with passenger growth outside of Frankfurt, revenue was positively impacted by an agreement reached in the first quarter of 2021 between Fraport and the German Federal Police (Bundespolizei) for remuneration of aviation security services provided by Fraport previously. The agreement generated extra revenue of €57.8 million. Other one-off effects also had a positive impact on the income side: These included compensation from the German and State of Hesse governments granted to Fraport for maintaining Frankfurt Airport’s operational readiness during lockdown, as well as pandemic compensation to the Group’s subsidiaries in Greece, the U.S. and Slovenia – which contributed a total of €275.1 million to Fraport’s “Other Income”. Combined with the remuneration payment from the German Federal Police, these non-recurring effects contributed a total of €332.9 million to other income, with a corresponding positive effect on the operating result (EBITDA).
