Aelia alliance prospers as Aéroports de Paris posts robust 2007 figures for retail and F&B – 14/02/08
Source: ©The Moodie Report
By Martin Moodie
FRANCE. Aéroports de Paris today revealed strong revenue growth for 2007, highlighted by an outstanding showing from its airside retail and food & beverage business and, in particular, its joint venture partnership with Aelia.
Against a backdrop of a +10.4% increase in group consolidated revenues to €2,292.4 million, commercial revenues (shops, bars & restaurants, car rentals and advertising) increased by +9.1% to €230 million.
Shops in restricted areas reported buoyant revenues, up +12.5%, thanks to strong passenger traffic growth and a net increase in business. ADP said: “These strong performances illustrate the pertinence of the Aéroports de Paris programme of expanding retail areas. The shops in La Galerie Parisienne reported excellent performances.”
Source: Aéroports de Paris
The strong growth in bar and restaurant revenues was reflected by +13.6% growth for the year.
Other activities (subsidiaries and joint ventures) reported very strong revenue growth, up +44.4% to €326.9 million. The joint venture with travel retailer Aelia, Société de Distribution Aéroportuaire (SDA), posted a +63.9% rise in contribution to €163.6 million (ADP’s share).
"Our strong revenue growth validates the pertinence of our strategy, which aims to make our airports more attractive and to develop our retail and real estate activities"
Chairman and CEO
Aéroports de Paris
The partnership operates shops specialising in alcohol, tobacco, perfume and cosmetics in all of the Aéroports de Paris terminals as well as the gourmet food shops in Terminal 2F.
Its scope of business (excluding gourmet food) was expanded to Terminal 3 at Paris-Charles de Gaulle on 1 November 2006 and to the two terminals at Paris-Orly (Orly Sud and Orly Ouest) on 1 January 2007, creating a consolidation effect of +46.7%. Excluding this consolidation effect, SDA's contribution rose +17.2%, thanks to buoyant sales in shops located in restricted areas.
A vintage year: Galerie Parisienne's high-end offer has helped drive the SDA alliance to new heights
Rental revenues from leasing space in air terminals rose +17.4% to €82.7 million over the full year. This robust performance was due to the indexation of prices to the cost of construction index, up +7.05% since 1 January 2007, and to the leasing of new retail areas in airport terminals, notably La Galerie Parisienne in Paris-Charles de Gaulle airport in the second half of 2007.
Car park and access revenues rose +4.5% to €150.4 million despite the loss of a subsidy from the Ile de France transport union (STIF), which was eliminated with the start-up of the CDG Val automatic shuttle on 1 April 2007. Excluding the STIF effect, the healthy growth of this activity was confirmed, up +9.5%, buoyed by the ongoing increase in hourly revenues and subscriptions.
Revenue growth, both commercially and overall, far outstripped passenger traffic growth of +4.7% year-on-year.
Aéroports de Paris Chairman and CEO Pierre Graff said: "For the fourth consecutive year, Aéroports de Paris is the leader among Europe's three largest airports in terms of traffic growth. Our strong revenue growth validates the pertinence of our strategy, which aims to make our airports more attractive and to develop our retail and real estate activities.
“Internationally, we continue to be commercially successful in a fiercely competitive environment, confirming the excellent reputation and solid expertise of our subsidiaries, ADPi and Aéroports de Paris Management."
Aéroports de Paris Management, the airport management subsidiary with stakes in other airport companies, generated revenues of €10.6 million, up +32.8%. The subsidiary benefited from the signing of new contracts and investment in minority stakes, notably a 25-year operating contract for the Queen Alia airport in Amman, Jordan, and a management contract for the Hajj Terminal of the Jeddah airport.
SOLID TRAFFIC GROWTH
ADP handled 86.4 million passengers in 2007, a record high. Traffic growth was particularly strong at Paris-Charles de Gaulle airport, up +5.4% to 59.9 million passengers, while Paris-Orly airport posted a +3.2% gain to 26.4 million.
During the year, passenger traffic reached a peak in March, and the summer season was also very strong: passenger traffic rose +6.2% in July, +8.0% in August and +5.4% in September, bolstered, for this last month, by the Rugby World Cup games [and for October by departing Kiwis –ED]. Labour unrest in the air transport sector had an estimated impact of 25 basis points on annual passenger traffic growth, two thirds due to strikes in October and a third to those in December.
ADP said: “In terms of traffic growth, this performance places Aéroports de Paris among the leaders of Europe's top five airports, and for the fourth consecutive year, it ranked number one among Europe’s three largest airports.”
Buoyant European and international traffic
In 2007, passenger traffic was once again driven by very strong growth in European traffic, up +7%, building on the +8.3% growth reported in 2006. This was mainly due to the boom in low cost carriers, which increased +27.5% at Aéroports de Paris airports in 2007, and accounted for 11% of Parisian traffic at the end of the year.
In Europe, ADP’s traffic by low cost carriers increased +41.7% with the countries in the Schengen area, where most of the main cities served by these airlines are located (for example, Nice, Milan and Barcelona). But the strongest growth in European traffic was with Spain, up +15.2% and Italy, up +12.1%.
Traffic to other international destinations, including many sources of future growth, increased +5.9%. The biggest contributors to growth in 2007 were Africa (+7.8%), buoyed by a surge in North African traffic, and the Middle East (+14.7%), thanks to the dynamic growth of local airlines serving Dubai, Bahrain and Qatar. Latin America also reported strong traffic growth, up +6.9%, thanks to the rapid development of traffic with Brazil and the impact of September’s Rugby World Cup games on traffic with Argentina.
Traffic with the French overseas territories rebounded +6.1% after a tough year in 2006. The Asia Pacific region reported milder growth of +1.6%, reflecting “feeble” growth with India and Singapore, but buoyant traffic with China, up +6.2%. Traffic in the mature North American market rose a satisfactory +2.9%.
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