Strong commercial results drive revenues at Malaysia Airports

MALAYSIA. Malaysia Airports Holdings Berhad (MAHB) posted a +13.6% year-on-year surge in revenues for the first nine months of 2010, to RM1,318.48 million (US$427.7 million), with commercial activities playing a significant role in the performance.

EBITDA grew by +10.7% to RM498.91 million (US$161.8 million) though pre-tax profits dipped -9.5% to RM291.40 million (US$94.5 million) in the period.

Revenues at MAHB’s own retail business, principally through its wholly owned Eraman duty free division, climbed by +19.2% to RM294.95 million (US$95.6 million) from the corresponding period last year, mainly through a big increase in passenger volume.

The revenue from rental of space, advertising and other commercial activities grew by +14.8% to RM292.37 million (US$94.8 million), contributed mainly by higher rental as a result of an increase in the number of outlets and concessionaires at the Satellite Building and Low Cost Carrier Terminal (LCCT).

This followed an increase in commercial space after the expansion of the LCCT in April 2009 and subsequently the completion of the Satellite Retail Optimisation Programme (SROP) in November 2009.

MAHB Managing Director Tan Sri Bashir Ahmad Abdul Majid said: “The increase in [total] revenue was attributed to stronger results from the airport operations segment, driven by strong recovery in air travel demand.

“Total passenger volume for the first nine months was 42.31 million – +15.1% higher than the corresponding period last year, when the international and domestic passenger movements grew by +25.2% and +7% respectively.

“Following higher passenger numbers, revenue generated by our airport operations segment improved by +14.9%. Aeronautical revenue grew +13.1% and our non-aeronautical revenue recorded growth of +17.0%, underpinned by growth in retail business and higher rental revenue derived from additional commercial space.”

Commenting on the new low-cost terminal in construction, Tan Sri Bashir said: “KLIA2, being the largest purpose-built dedicated terminal for low-cost carriers in the world, is the critical ingredient for the full realisation of KLIA as the Next Generation Hub (NGH). The NGH will provide connectivity for both legacy and low-cost airlines, and for domestic and international travel. This not only emphasises our commitment and support for low fare travel, but more so our conviction that this will take us to the next level of growth in air travel demand.

“IATA has reported that the industry recovery has been stronger and faster than anyone predicted, with Asia Pacific, which has eclipsed North America as the world’s largest air travel market, continuing to outperform the rest of the world. With MAHB’s encouraging financial performance, we are optimistic of a better year ending 2010.”

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