Fraport AG · XETR:FRA
Fraport — H1 2001 Earnings Presentation
32 slides from Fraport's earnings presentation, Aug 23, 2001
Slide 1: Half Year Results Presentation to Analysts
Fraport AG Frankfurt Airport Services Worldwide Half Year Results Presentation to Analysts August, 23rd 2001 0
Slide 2: Disclaimer
Disclaimer This document has been prepared by Fraport AG Frankfurt Airport Services Worldwide solely for use at the analyst presentation held in connection with the interim report 30.06.2001 of Fraport. It is not to be reproduced or circulated to any person other than to whom it has been provided at
Slide 3: Fraport on Track Despite Weak Markets
Fraport on Track Despite Weak Markets • 5% increase in revenues • Stable EBITDA development • Impact of LH-strike and economic slowdown on PAX growth • IPO raised € 904m proceeds • Fraport will be included in MDax as of 24 September 2001 • Capacity expansion on time - Regional planning procedure wil
Slide 4: Business Mission
Business Mission By 2005, we will be one of the three most efficient and profitable airport groups world-wide Our major competitive advantage lies in our ability to consistently connect major transportation modes and offer attractive, integrated services to our customers 3
Slide 5: Strategy
Strategy Core Business Core Business Growth Business Expansion Consolidation • Exploit strong position in • Capacity expansion to • Leverage Fraport’s expertise Aviation and Ground secure medium-term growth beyond home location Services and competitive position • Acquire and operate airports • Foste
Slide 6: Significant Change in Our Shareholder Structure
Significant Change in Our Shareholder Structure Shareholders Pre IPO Shareholders Post IPO City of Fed. Republic Fed. Republic Frankfurt(1) of Germany Free Float of Germany 18.4% 28.9% 25.9% 29.0% 32.1% 45.2% 20.5% City of State of Hesse State of Hesse Frankfurt(1) 64.0m shares 90.1m shares Note: (1
Slide 7: Business Drivers at Frankfurt Airport
Business Drivers at Frankfurt Airport HY 1/2001 HY 1/2000 Growth PAX (m) 24.0 23.3 2.7% Air Freight (t 000) 744 749 (0.6%) Mail (t 000) 69 67 2.6% ATMs (000) 226 224 0.7% PAX / PAX-ATM (1) 116 114 1.5% MTOW (t 000) 12,679 12,210 3.8% Seat Load Factor 67.9% 68.2% Notes: (1) Calculation includes sched
Slide 8: PAX Development in Second Quarter Impacted by Lufthansa Strike
PAX Development in Second Quarter Impacted by Lufthansa Strike % PAX growth compared to same month of last year 12% 10% 8% 6% 4% 2% 0% -2% Jan 01 Feb 01 Mar 01 Apr 01 May 01 Jun 01 Jul 01 -4% -6% -8% -10% Frankfurt Heathrow Schiphol CDG Source: Rapid Data Exchange CDG: Jul 01 data not available 7
Slide 9: FRA Dominates German Airport Business
FRA Dominates German Airport Business FRA 23.340.174 FRA Others 34,5% Others 23.964.636 33.526.579 33.265.959 34,8% 49,5% 48,2% MUC MUC 10.874.616 11.730.506 16,1% 17,0% Airport Passengers HY 1/2000 Germany HY 1/2001 Source: ADV; total inbound+outbound+transit 8
Slide 10: Frankfurt Dominates German Freight Business
Frankfurt Dominates German Freight Business Others Others 299.067 t 308.413 t 26,9 % FRA 27,5 % FRA 748.923 t 744.477 t MUC 67,3 % 65.072 t MUC 67.065 t 66,5 % 5,8 % 6,0 % HY 1/2000 HY 1/2001 Cargo City South planned, built and marketed in record time Source: ADV 9
Slide 11: Efficient Use of Existing Runway System
Efficient Use of Existing Runway System • Fraport is keen to increase the coordinated movements per hour from 78 to 80 as from summer 2002 • Increase MTOW +3,8 % • Increase PAX/PAX-ATM from 114 to 116 10
Slide 12: Enhanced Catchment Area
Enhanced Catchment Area • High speed train link enhances catchment area (1) • Travel time from key cities (2) From To Frankfurt To Amsterdam Dusseldorf 1:08 1:40 Cologne 0:58 2:01 Amsterdam 2:48 - Munich 2:50 5:38 Stuttgart 1:12 4:00 Source: Deutsche Bahn Note: (1) 11m (35m) inhabitants (‘Einwohner’
Slide 13: Successful Implementation of Retail Strategy
Successful Implementation of Retail Strategy • Revenue increase of 11.5 % • End of July 12.600 sqm were in operation, about 14.000 sqm reaching by the end of 2001 • Foundation of the Joint Venture ARS (Airport Retail Solutions) together with ECE in August • Close co-operation with Schiphol 12
Slide 14: Stable Regulation of Airport Charges
Stable Regulation of Airport Charges • Annual renewal procedure: • Consultation with airline associations regarding planned fee structure • Filing of application with regulator • Regulator consults airlines, airline associations and other interest groups • EU principles for decisions: • cost-related
Slide 15: Capacity Expansion Process on Time
Capacity Expansion Process on Time Planning Approval Construction Operation 1997 Start of 2001 Regional • 2004 Completion • 2006 new runway discussions planning proce- of approval • 2007-2013 new process 1998 - 2000 dure will start on terminal in 3 phases Mediation 27 August 2001 • Start of construc
Slide 16: External Growth - Value Driven Strategy
External Growth - Value Driven Strategy • Exploiting core skills and expertise beyond home location: Airport Management Strategy Airport Services Strategy Cherry picking • Flight and terminal operations • Quality approach at selected locations with stable competitive environment Hub strategy • Equit
Slide 17: Positive Development of International Airport Management Projects
Positive Development of International Airport Management Projects • Pax growth of 37% in the first half of 2001 • Cost reduction and efficiency improvement programme on its way • Merger of FHG and HUH completed on July 24th • Pax growth of 46% in the first half of 2001 • EBITDA more than tripled to
Slide 18: Group Financials and Business Segments
Group Financials and Business Segments 17
Slide 19: Key Financial Highlights
Key Financial Highlights • 5 % revenue growth • Stable EBITDA development due to higher costs • Cash inflow from operations (€ 140m) exceeds cash outflow from investments (€ 122m) • IPO increased equity ratio to almost 50 % and reduced gearing to 21% • Strong performance of Business Segment Non-Avia
Slide 20: Profit & Loss Statement
Profit & Loss Statement €m HY 1/2001 HY 1/2000 Growth Revenues 756.9 721.2 5.0% • Significant revenue growth Total Revenues(1) 805.0 739.5 8.9% Staff costs 346.7 314.2 10.3% • Increase in other operating expenses Cost of materials 130.0 123.5 5.3% mainly due to special effects Other operating expens
Slide 21: Revenue Growth
Revenue Growth Group Revenues (€ m)(1) • All segments contributed to + 5% 757 revenue growth 721 750 3% 3% • Increase in PAX (+2.7%) and 25% MTOW (+3.8%) 24% 500 • Tariff increase for airport and infrastructure services 35% 33% • Strong increase in Non- 250 Aviation Revenues 38% 39% • Increased cont
Slide 22: Employee Efficiency
Employee Efficiency Staff Costs (€ m) • 10 % increase in staff costs 42.5% • Non-Aviation and Ground 400 41.7% Handling with highest 11 contributions to increase in 300 staff costs 336 • Almost € 11m can be 314 200 considered as special effects 100 • Employee efficiency (1) improved to 41.7% adjuste
Slide 23: Increase in Non-Staff Costs Due to Special Factors
Increase in Non-Staff Costs Due to Special Factors Non-Staff Costs (€ m) • Non-staff costs comprise material 300 costs and other operating costs + 19% 255 • Increase in other operating costs 215 due to special effects 200 125 - € 29m unrealized currency 91 losses - € 10m one-off costs 100 130 124 0
Slide 24: Stable EBITDA and Positive Net Income Development
Stable EBITDA and Positive Net Income Development EBITDA (€ m) Net Income (€ m) • Stable EBITDA development above 300 50 € 200m + 43% 250 - 3% 40 • EBITDA margin(1) 200 decreased from 29% 39 211 30 to 27% 205 150 27 20 • Strong growth in Net 100 Income 10 50 • Average tax rate on a 0 0 group level d
Slide 25: Net Investments Covered By Cash Flow From Operations
Net Investments Covered By Cash Flow From Operations Cash inflow from operations (€ m) • Strong increase in operating cash flow to 200 + 30% € 140 m 150 140 • Operating cash flow / Revenues amounts 100 108 to 18.5% in the first half of 2001 (compared 50 to 15.0% in the first half of 2000) 0 HY 1/200
Slide 26: Balance Sheet
Balance Sheet (€ m) 30.06.01 31.12.00 Growth IPO impact: Fixed assets 2,762 2,729 1% Current assets 1,041 270 286% • Total IPO proceeds: € 904m Total Assets 3,848 3,043 26% • Total IPO costs: € 46m • Net proceeds: € 858m Equity 1,906 1,019 87% Debt (1) 1,219 1,268 (4%) • Short term use of proceeds E
Slide 27: Segment Overview – Business Activities and Revenues
Segment Overview – Business Activities and Revenues Aviation Non-Aviation Retail Flight Operations Property Terminal Management Car Parking Management € 201m € 311m € 23m € 270m Ground Handling Other Landside: Energy - Passenger Services IT Services - Cargo Services Miscellaneous Airside - Ramp Serv
Slide 28: Financials - Aviation
Financials - Aviation €m HY 1/2001 HY 1/2000 Growth External Revenues 311.2 279.1 11.5% • Revenue growth at Frankfurt location reflects Total Revenues(1) 322.9 293.1 10.2% • PAX growth of 2.7% • MTOW growth of 3.8% EBITDA(2) 16.2 31.2 (48.1%) • average tariff increase of 3% EBITDA margin(3) 5.0% 10.
Slide 29: Financials - Ground Handling
Financials - Ground Handling €m HY 1/2001 HY 1/2000 Growth External Revenues 269.9 263.7 2.4% • Only moderate revenue growth • Decrease in EBITDA due to: Total Revenues(1) 292.0 284.7 2.6% • increase in No. of employees due to higher EBITDA(2) 2.2 16.7 (86.8%) expected traffic • employee incentive E
Slide 30: Financials - Non-Aviation
Financials - Non-Aviation €m HY 1/2001 HY 1/2000 Growth • Strong increase in external External Revenues 201.0 177.4 13.3% revenues: Total Revenues(1) 396.1 347.1 14.1% • successful retail strategy • increasing contribution EBITDA(2) 174.9 152.8 14.5% from subsidiaries • Stable EBITDA margin at high
Slide 31: Financials - Other
Financials - Other €m HY 1/2001 HY 1/2000 Growth External Revenues 22.9 19.3 18.7% • Positive development of revenues Total Revenues(1) 86.2 75.8 13.7% • Stable EBITDA margin around 13% EBITDA(2) 11.5 9.8 17.3% EBITDA margin(3) 13.3% 12.9% EBIT 4.2 3.7 13.5% Notes: (1) incl. intersegment revenues (2
Slide 32: Outlook
Outlook 31