- The Group recorded an increase in revenue by 9.1% to RM3.1 billion for 9M16
- Normalised EBITDA[1] for the Group increased by 16.6% to RM1,337.3 million for the same period
- Interim dividend of 4 sen for the financial year ending 31 December 2016 declared in July
- 9M16 passenger traffic up by 4.8% to 87.7 million, Malaysia traffic exceeding expectations
- Improved average load factors and positive airline seat capacity for 4Q16 bodes well for overall passenger traffic for the year
SEPANG – Malaysia Airports Holdings Berhad (the Group) reported revenue of RM3.1 billion and earnings before interest, tax, depreciation and amortisation (EBITDA) of RM1,337.3 million for the nine months ended 30 September 2016 (9M16). Both the Group’s revenue and normalised EBITDA increased by 9.1% and 16.6% respectively when compared to the nine months ended 30 September 2015 (9M15). The EBITDA achieved represented 77.9% of its annual EBITDA target for the full year ending 2016.
With the combined operating performance of Istanbul Sabiha Gokcen International Airport, the Group’s system of airports handled 87.7 million passengers in 9M16, representing a 4.8% growth over 9M15. Over the same period, the Group’s normalised profit before tax[2] (Normalised PBT) grew 5.9x to RM98.7 million while profit after tax rose to RM36.0 million from a normalised loss after tax2(Normalised LAT) of RM5.2 million in 9M15.
Malaysia Operations
Passenger movements at the Group’s 39 airports in Malaysia stood at 65.1 million for 9M16, a 4.4% growth over 9M15. KLIA recorded a 5.9% passenger growth for the period while other airports in Malaysia recorded an aggregate growth of 2.4%. The average load factor for the period increased by 5.9 percentage points to 74.7% in September 2016.
The Malaysia operations recorded revenue of RM2,271.6 million in 9M16, up by 10.4% over 9M15, with both aeronautical and non-aeronautical revenue growing by 10.8%. The improvement in aeronautical revenue to RM1,151.0 million is mainly attributed to the 6.7% rise in international passenger movements for the period. Meanwhile, retail and rental revenue continue to achieve double digit growth of 11.3% and 10.2% respectively, cumulating in non-aeronautical revenue of RM1,026.7 million for the 9 month period. As a result, normalised EBITDA for Malaysia operations rose by 27.6% to RM786.9 million.
Overseas Operations
Passenger movements at ISG grew 5.9% to 22.5 million passengers in 9M16. Revenue from the Turkey operations grew by 6.5% to RM727.7 million for the same period while EBITDA rose 4.7% to RM540.3 million on the back of the resilient growth in passenger movements. Revenue from the operations in Doha, Qatar, remained flat at RM93.4 million during the same period.
Outlook
Malaysia Operations
The 12.3% overall passenger growth for the month of September was the first double-digit growth for 2016 with 10 airports registering between 11-25% growth. Both local and foreign carriers continued with impressive growth at KLIA in the third quarter with most sectors to North Asia and the Middle East recording more than 10% growth, including China, Japan, Qatar and Turkey. Similarly, the India and Singapore sectors also registered double digit growth for the period. The Group’s passenger traffic for fourth quarter is likely to outperform the rest of the year due to improved load factors and increase airline seat capacity.
Overseas Operations
Daily passenger movements from the Turkey operations has since stabilised and exceeded the levels prior to incidences in June and July with significant improvements noted particularly in September 2016. We anticipate growth in the near term to be predominantly domestic driven as sentiment continues to recover.
The Group had recently secured a 3 year extension for its facility management services at the Hamad International Airport, Doha, Qatar. The contract extension, valued at QAR163.9 million or equivalent to RM180.8 million, bodes well for the Group’s overseas opportunities which contributes significantly to the Group’s growth.
Malaysia Airports’ has recently begun several initiatives as part of providing the Total Airport Experience (TAE), a key strategic priority around under Runway to Success 2020. These initiatives include the introduction of KLIA Premier Access, new airport & retail leaflet guides, better WiFi services and enhanced wayfinding amongst others. TAE is aimed at reimagining the airport experience by enhancing the passenger journey across all the touchpoints, delivering better airport-retailer and airport-airline relationship as well as transforming Malaysia Airports into a customer-centric organisation.
[1] Normalised EBITDA is after excluding the impact of one-off gains from the 10% Delhi stake disposal and realised FX gain on settlement of bridging loan (one-off gains) in 9M15
[2] Normalised PBT and Normalised LAT is after excluding the impact of one-off gains and the associated premium on debenture arising from the Delhi stake disposal in 9M15