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MALAYSIA AIRPORTS RECORDS HISTORICAL HIGH REVENUE, EBITDA AND PASSENGER TRAFFIC FOR FY16

28 February 2017

Key Highlights 

                                                

• This year saw Malaysia Airports charting a few firsts:

   - The Group registered RM4.2 billion in revenue, an increase  of 7.8%  in FY1

   - Malaysia operations achieved RM1 billion EBITDA mark. Normalised EBITDA[1] for the Group increased by 8.2% to           RM1.7 billion for the same period

   - Group’s passenger traffic up by 5.8% to 118.6 million. KLIA grew 7.6%, surpassing 50 million passenger traffic. 

• Extension for Operating Agreements granted for an additional 35 years to 2069

• Malaysia Airports Board of Directors recommends a final dividend of 6 sen per share for FY16 


SEPANG – Malaysia Airports Holdings Berhad (the Group) reported revenue of RM4,172.8 million and earnings before interest, tax, depreciation and amortisation (EBITDA) of RM1,709.9 million for the financial year ended 31 December 2016 (FY16). Both the Group’s revenue and normalised EBITDA increased by 7.8% and 8.2% respectively when compared to the financial year ended 31 December 2015 (FY15). The all-time record high results were achieved despite the challenging global and domestic market conditions.


With the combined operating performance of Istanbul Sabiha Gokcen International Airport, the Group’s network of airports handled 118.6 million passengers in FY16, representing a 5.8% growth over FY15. Over the same period, the Group’s normalised profit before tax[2] (Normalised PBT) grew 27.0x to RM183.3 million while profit after tax rose to RM73.2 million from a normalised profit after tax2 (Normalised PAT) of RM0.7 million in FY15. Taking into account the impact of the one-off and exceptional costs in the prior year, the Group’s EBITDA, profit before tax and profit after tax still grew by 1.8%, 299.2% and 82.4% respectively.


The Board of Directors recommend a final dividend of 6 sen per share is proposed for FY16. Together with the earlier interim dividend of 4 sen per share, the total dividend for the year is 10 sen per share.


Malaysia Operations Review


Passenger traffic at the Group’s 39 airports in Malaysia stood at 89.0 million for FY16, a 6.1% growth over FY15, exceeding the forecast growth of 2.5%. KLIA recorded a 7.6% passenger growth for the period while other airports in Malaysia recorded an aggregate growth of 4.1%. The average load factor for the period increased by 4.3 percentage points to 74.8% in December 2016.


The Malaysia operations recorded revenue of RM3,099.3 million in FY16, up by 9.3% over FY15, with both aeronautical and non-aeronautical revenue growing by 8.6% and 7.6% respectively. The improvement in aeronautical revenue to RM1,563.9 million is mainly attributed to the 8.1% rise in international passenger traffic, relocation of Malindo to KLIA Main and consolidation of operations at Kota Kinabalu International Airport. Meanwhile, retail and rental revenue continue to achieve a strong growth of 10.0% and 7.1% respectively, cumulating in non-aeronautical revenue of RM1,850.2 million for the year. As a result, normalised EBITDA for Malaysia operations rose by 16.0% to RM1,000.0 million (or by 4.1% when including the one-off gains and exceptional costs that were recorded in FY15)


Based on current trend, the Group foresees that this trajectory of growth can be maintained.


Overseas Operations Review


Passenger traffic at Istanbul SGIA grew 4.8% to 29.6 million passengers in FY16. Revenue from the Turkey operations grew by 4.3% to RM958.8 million for the same period while EBITDA rose 2.7% to RM719.1 million on the back of the resilient growth in passenger movements. Revenue from the operations in Doha, Qatar, dipped slightly by 0.7% to RM114.7 million during the same period.


Outlook


Malaysia Operations


Traffic growth of 6.1% for the Group’s Malaysian airports in 2016 is an indication of continuing latent demand for air travel. It is encouraging to note that international passenger growth momentum year-on-year had picked up in the second half of 2016, improving from 5.0% in the first half to 11.0% in the second half. The Malaysia passenger traffic in 2017 is expected to perform well in view of the upward trend in the second half of 2016.


Overseas Operations


2016 was a challenging year with Istanbul SGIA’s passenger traffic negatively affected by the spate of security incidents and visa restrictions. We anticipate growth in the near term to be moderate and predominantly outbound driven.  Malaysia Airports remains committed to its investment in Turkey and will continue focusing on revenue optimisation and operational efficiency to facilitate growth.


Overview


Malaysia Airports Managing Director, Datuk Badlisham Ghazali commenting on the outlook for the year, “The Group began 2017 with a positive start as KLIA welcomed several new carriers in the first two months. The further increase in seat capacity offered by Malindo, the AirAsia Group and Malaysia Airlines for the immediate future also provides a positive outlook for 2017. Malaysia will also be hosting the Visit Asean@50 Campaign in conjunction with the Kuala Lumpur 2017 Sea Games, while the continued initiatives by the Government and Malaysia Airports to attract more guests from China and India also bodes well for inbound tourism to the country.”


Malaysia Airports has also moved another step closer to the fulfilment of its vision when the Group received government approval for the extension of its Operating Agreements in Malaysia for an additional period of 35 years to 2069. The Group and several Government agencies are finalising the terms and conditions in relation to  the Operating Agreements . Datuk Badlisham further adds, “This will allow Malaysia Airports to optimise its growth potential and expand from a core airport to that of a complete, synergistic aviation ecosystem which include KLIA Aeropolis development that provides best-in-class connectivity, speed, and agility.”


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