All you need to know about the Sydney Airport FY2017 results

Sydney Airport released its 2017 financial year results today. This included information on inbound tourism, capital expenditure, and outlook for FY2018. Blue Swan has pulled together all the key highlights from the results into an easy to read snapshot for your reference.

Results:

Sydney Airport reported (22-Aug-2017) financial highlights for six months ended 30-Jun-2017:

  • Total revenue: AUD714.2 million (USD538.6 million), +7.9% year-on-year;
    • Aeronautical: AUD320.6 million (USD241.8 million), +9.0%;
    • Aeronautical security: AUD43.6 million (USD32.9 million), +0.8%;
    • Retail: AUD162.6 million (USD122.6 million), +14.3%;
    • Property and car rental: AUD106.6 million (USD80.4 million), +3.3%;
    • Parking and ground transport: AUD77.1 million (USD58.1 million), +2.2%;
  • EBITDA: AUD577.0 million (USD435.2 million), +7.6%;
  • Net profit: AUD166.6 million (USD125.6 million), +4.4%;
  • Passenger numbers: 21.0 million, +3.6%;
    • Domestic: 13.2 million, +1.3%;
    • International: 7.7 million, +7.7%;
  • Total assets: AUD12,126 million (USD9145 million);
  • Cash and cash equivalents: AUD538.2 million (USD405.9 million);
  • Total liabilities: AUD11,269 million (USD8499 million).

*Based on the average conversion rate at AUD1 = USD0.754173

Sydney Airport notes inbound tourism market increase 10% in 1H2017

Sydney Airport MD and CEO Kerrie Mather noted “inbound tourism market has seen strong growth of nearly 10% for the half [1H2017] and the rolling 12 months, with excellent performance from a diverse range of major Asian markets, including China, India, Philippines, Indonesia, Japan and Vietnam”. The airport estimated an additional daily Airbus A380 services between China and Sydney will generate AUD451 million (USD358 million) p/a to New South Wales economy. The airport currently contributes AUD30.8 billion (USD24.4 billion) in economic activity p/a.

Sydney Airport announce capital expenditure for 2017

Sydney Airport utilised AUD161.4 million (USD128.2 million) of capital expenditure (capex) in 1H2017, with AUD250 million (USD198.6 million) more to be delivered in 2H2017.  The focus of the capex program over the half include:

  • Aeronautical capacity: upgauging aircraft parking bays, increasing bussing facilities and replacing and refurbishing our baggage facilities;
  • Airport access: new access road and pedestrian/cycle bridge in the international precinct;
  • Customer experience: upgrading bathrooms, community facilities, increased and upgraded gate lounge seating, expanded self-serve check in and bag drop facilities, arrivals concourse development, departures/emigration upgrades and further retail and food and beverage rollouts;
  • Business expansion: hotel development and acquisition.

The 2017 capex program is linked to an agreed 4.3% aeronautical price increase from 1-Jul-2017.

Sydney Airport upgrades 2017 distribution guidance to 34.5 cents per stapled security

Sydney Airport upgraded its 2017 distribution guidance from 33.5 cents to 34.5 cents per stapled security, reflecting a year-on-year increase of 11.3%. MD and CEO Kerrie Mather attributed the upgrade to “combined impact of strong business performance and excellent capital management outcomes, coupled with a positive outlook for the second half of 2017”. The increased distribution also represents a 10.4% CAGR over the five years from 2012.

Sydney Airport complete 122 leasing transactions in 1H2017

Sydney Airport completed approximately 122 leasing transactions in 1H2017. The airport’s property portfolio has over 650 leases with a 98.6% occupancy rate airport wide.

Sydney Airport: Low parking revenue growth in 1H2017 due to shift to other transport mode

Sydney Airport noted slower car parking revenue growth in 1H2017 was impacted by modal shift to train, increased ride sharing and limousine services, and lower domestic and Australian international outbound growth. However, the airport said this partly resulted in better ground transport performance. The airport received AUD77.1 million (USD61.2 million) from parking and ground transport services, a year-on-year increase of 2.2%. Meanwhile online reservations for car parking products continues to form a larger proportion of total revenues at 41%, supporting higher asset utilisation.