Key FY17 Highlights
- Group revenue stood at RM4,652.3 million, 11.5% higher than FY16
- EBITDA for the Group increased by 11.8% to RM1,910.9 million
- Group net earnings grew 224.0% to RM237.1 million
- Passenger traffic for the Group’s network of airports grew by 7.8% to 127.9 million passengers
- Malaysia Airports Board of Directors recommends a final dividend of 7 sen per share for FY17
- Launch of the Digital Free Trade Zone a game changer for KLIA Aeropolis
- Tourism Malaysia partnership strengthened to court more international tourists arrivals
SEPANG – Malaysia Airports Holdings Berhad (the Group) reported revenue of RM4,652.3 million and earnings before interest, tax, depreciation and amortisation (EBITDA) of RM1,910.9 million for the financial year ended 31 December 2017 (FY17). Both the Group’s revenue and EBITDA increased by 11.5% and 11.8% respectively when compared to the financial year ended 31 December 2016 (FY16). The Group surpassed its headline financial Key Performance Indicators for FY17 of RM1,796.6 million by 6.4%.
The Group’s profit before tax (PBT) grew by 82.4% to RM334.5 million while net earnings increased by 224.0% to RM237.1 million over the same period. With the combined operating performance of Istanbul Sabiha Gokcen International Airport (SGIA), the Group’s network of airports handled 127.9 million passengers in FY17, representing a 7.8% growth over FY16.
The Board of Directors recommends a final dividend of 8 sen per share for FY17. Together with the earlier interim dividend of 5 sen per share, the total dividend for the year is 13 sen per share (FY16: 10 sen per share).
Operations Review
Passenger traffic for Malaysia operations grew by 8.5% to 96.5 million passengers in FY17, surpassing the 90 million passengers mark for the first time. Kuala Lumpur International Airport (KLIA) recorded an 11.2% growth in passenger traffic to 58.5 million passengers for the same period while other airports in Malaysia recorded an aggregate growth of 4.6% to 38.0 million passengers. Malaysia Airports reached another milestone when its international passenger market share in Malaysia exceeded 50% of overall traffic in FY17.
The Group’s Malaysia operations posted revenue of RM3,429.1 million in FY17, up by 10.6% over FY16. Revenue from both aeronautical and non-aeronautical segments grew by 8.0% and 13.4% respectively. The improvement in aeronautical revenue is mainly attributable to the 14.1% rise in overall international passenger traffic. Retail and commercial revenue continue to achieve a double-digit growth of 15.4% and 11.3% to RM853.7 million and RM734.6 million respectively. Owing to the stronger revenue contributions, EBITDA for Malaysia operations rose by 11.6% to RM1,116.1 million.
Istanbul SGIA recorded 31.3 million passengers in FY17, an improvement of 5.6% over FY16. Revenue from Turkey operations for the same period rose by 13.2% to RM1,085.7 million while EBITDA for the period amounted to RM780.9 million or 8.6% higher than FY16. Revenue from the Group’s project and repair maintenance operations in Doha, Qatar increased by 19.9% to RM137.5 million in FY17.
Outlook
International passenger movements for the China, India and South East Asia sectors are expected to make up 75% of international traffic in 2018. Based on prevailing economic conditions and additional seat capacity offered by airlines, Malaysia passenger traffic is expected to grow by 6.3% in 2018 with international and domestic passenger traffic growing at 8.3% and 4.2% respectively.
Meanwhile, Istanbul SGIA is expected to register 34 million passenger movements in 2018 in line with the stable economic growth in Turkey.
Commentary
On 3 November 2017, the KLIA Aeropolis Digital Free Trade Zone (DFTZ) Park was officially launched by the Prime Minister, Dato’ Sri Mohd Najib Tun Abdul Razak, and Alibaba Group Holding Ltd Founder and Executive Chairman, Jack Ma. Equipped with the latest technology, the DFTZ Park in KLIA Aeropolis will serve as a cluster of facilities for customs clearance, warehousing and logistics to facilitate and accelerate double digit growth of trans-shipment air cargo volumes thus, positioning KLIA Aeropolis as a leading eCommerce trans-shipment hub.
The Group had also entered into a strategic tie-up with Malaysia Tourism Promotion Board (Tourism Malaysia) as the country prepares early for the Visit Malaysia Year 2020 campaign. On 8 November 2017, the Group signed a Memorandum of Understanding (MoU) with Tourism Malaysia to promote inbound traffic globally, focussing on tourists from India, China and Europe. The Group’s Managing Director, Datuk Badlisham Ghazali, commented, “This unique initiative will yield greater tourism impact as well as a significant milestone for both parties in the development of inbound tourism and in developing our international gateways, especially KLIA.”
2018 holds the promise of being another exciting year for the Group as it remains committed in delivering high quality services to its stakeholders by embedding a customer-centric culture in airport operations. This is in line with the Total Airport Experience initiative under Runway to Success 2020, in enhancing the airport experience across all touchpoints for its stakeholders