24.2.2010
CPH: Strong finish to challenging year
Despite the downturn in the world economy during 2009, Copenhagen Airports A/S (CPH) succeeded in recovering the traffic lost following the bankruptcy of Sterling and, towards the end of the year, had more locally departing passengers than the year before. CPH is therefore reporting a profit that is in line with its forecasts. A new long-term charges agreement with the airlines and announced increases in the number of long-haul routes will strengthen the company going forward. CPH is working with its stakeholders on both sides of the Øresund strait to strengthen the awareness of the Øresund region abroad, which is a prerequisite for future growth both for the region and for the airport.
Passenger numbers at Copenhagen Airport dropped by 8.4% in 2009, which led to a 6% drop in revenue to DKK 2.9 billion. Excluding one-off items, profit after tax declined by 24% to DKK 645 million, primarily due to increased depreciation on assets due to the continuing high investment level and interest expense.
“We have seen a change for the better in travel patterns during the year. Many passengers chose to go on summer holidays in spite of the economic downturn, and we saw an increase in passenger numbers in the last quarter of the year. Moreover, Copenhagen Airport has now fully recovered the traffic lost following the Sterling bankruptcy in 2008 in terms of number of routes, driven especially by growth from Norwegian, Transavia, easyJet and Cimber Sterling,” said Brian Petersen, CEO of Copenhagen Airports A/S.
Strengthening the hubIn the course of 2009, CPH signed a new 5½-year agreement on the charges paid by airlines for use of the airport. Charges will be kept at the current levels until April 2011, after which they will increase by CPI+1% over the following four years. The charges agreement will benefit both CPH and the airlines, resulting in a stable period with defined charges for both CPH and the airlines.
The agreement also strengthens Copenhagen Airport’s position as a northern European hub, which is a prerequisite for increasing accessibility to the Øresund region. In the next few years, CPH will work closely with a number of organisations and stakeholders on both sides of the Øresund. Among other things, international awareness of the region will be strengthened through increased promotion of the Øresund region as a destination.
“When Delta Air Lines, Air Canada and Qatar Airways open their new routes to New York JFK, Toronto and Doha, respectively, in 2010, Copenhagen will have 18 intercontinental routes, the highest number since the turn of the century. The three new routes represent an important step in the efforts to strengthen our position as a hub and in increasing accessibility to the Øresund region. The collaboration across the Øresund is to ensure that we continue to be successful in attracting new routes, thereby benefiting tourism as well as trade and industry, ”said Brian Petersen.
A high level of capital investmentCPH maintained a high level of investment in 2009 with investments primarily in the construction of the new low-cost pier, CPH Swift, renovation of Pier C which is primarily used for long-haul flights, renovation of the north-end of Terminal 3, renovation of toilets and a number of upgrades to IT systems and information screens in the check-in area.
CPH will continue the high investment level in 2010, not least in connection with the construction of CPH Swift, which will provide airport facilities designed to meet the needs of the steadily growing number of low-cost airlines.
“If CPH is to hold its own against strong international competition, we must focus on strengthening our transfer product and concurrently cater to the demands of low-cost airlines. The low cost airlines in particular have changed people’s travel habits, and in order for CPH to exploit the great potential and attract more low cost airlines, we must have a product adapted to their needs. CPH Swift is therefore necessary if we are to be an attractive airport to low cost airlines,” said Brian Petersen about CPH Swift, which is expected to open towards the end of the year.
OutlookWhilst challenges remain in 2010, CPH forecasts an increase in the number of passengers, which is expected to have a positive impact on revenue. Earnings are expected to be slightly below the 2009 level due to increased depreciation on assets due to a continuing high level of investments and financing costs.