HONG KONG. Retail licences and advertising revenue surged by +23.2% year-on-year at Hong Kong International Airport (HKIA), hitting HK$6,155 million (US$794 million) in the 12 months to 31 March 2014. The results were reported by Airport Authority Hong Kong today.
Retail licences and advertising represented 41.6% of turnover in the year and contributed more than half of all turnover growth. AAHK said: “This increase was a result of the full-year effect of new anchor licences awarded in the last fiscal year; better sales performance in the luxury brands and specialty and commercial catering categories; the opening of a mega shop; higher advertising revenue from new clients and categories; and joint promotional initiatives with major brands and China UnionPay.”
Other terminal commercial revenue mainly represents income from leasing offices and airport lounges to airlines and other tenants. This category grew +7.8%, to HK$1,103 million (US$142 million), largely due to a property index adjustment in rental rates during the fiscal year.
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Overall, group revenue and profit attributable to the equity shareholder surged +12.8% and +14.9% respectively, to HK$14,810 million (US$1.9 billion) and HK$6,454 million (US$832 million). Earnings before interest, taxes, depreciation and amortisation (EBITDA) also increased +12.3% year on year to HK$9,938 million (US$1.28 billion).
AAHK said the robust top- and bottom-line increases were attributed mainly to growing traffic, higher retail concessions revenue and effective cost controls. During the year, passenger volume and aircraft movements set new records of 60.7 million and 377,476 movements respectively, representing year-on-year growth of +6.1% and +6.3%.
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Chanel’s new two-storey mega-shop is one of the central features of the luxury zone at HKIA |
Cross-boundary passenger trips between Hong Kong International Airport (HKIA) and destinations across the Pearl River Delta also saw steady growth, with approximately 2.7 million passengers travelling via SkyPier and two million passengers using the limousine and coach services. These figures represented gains of +1.7% and +1% respectively compared to the last fiscal year.
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AAHK Chief Executive Officer Stanley Hui Hon-chung said: “Air traffic at HKIA is growing much faster than the projections made in HKIA Master Plan 2030. We expect that the global economic recovery and robust regional growth will continue to drive traffic demand at a moderate rate. As a result, the two-runway system at HKIA will likely reach its capacity in a few years’ time.
“To increase ground handling capacity for the immediate and medium terms, we have been pushing ahead with our Midfield development and west apron expansion projects. An investment of more than HK$12 billion, these two projects will add a total of 48 parking stands and allow HKIA to serve an additional 10 million passengers a year,” added Hui.
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Executive Director, Finance William Lo Chi-chung said: “We are very happy with our record-breaking performance for fiscal 2013/2014. This year we will face a number of challenges, like slower retail sales due to the high revenue base we set, the sluggish local retail market, increased operating expenses to maintain our excellent service levels, and ongoing investments in much-needed capacity enhancements.”
To capitalise on business opportunities arising from developments such as the Hong Kong-Zhuhai-Macao Bridge and the Tuen Mun-Chek Lap Kok Link – all of which will commence operations in the next few years – AAHK is mapping out development plans for the North Commercial District (NCD). The first phase of the NCD development will be a hotel with more than 1,000 rooms, and a master plan for the entire district is expected to be completed this year.
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