Flughafen Zurich Ag · SIX:FHZN
Flughafen Zurich — Investor Day (September 2023)
88 slides from Flughafen Zurich's investor day presentation, Sep 4, 2023
Slide 1: Investor Day 2023 – Tour d’Horizon
Investor Day 2023 Tour d’Horizon Josef Felder, Chairman September 4th, 2023
Slide 2: Investor Day Program
Investor Day Program What to expect of today? 09:30 Tour d’Horizon Chairman 10:15 Strategic Topics CEO Bathroom Break 11:00 Update Noida MD International 11:30 Financial Outlook CFO Lunch Break 13:00 Breakout session I 14:00 Breakout session II Coffee Break 15:15 Breakout session III 16:00 End of ev
Slide 3: Content – Tour d’Horizon
Content Tour d’Horizon 1 Historical Context 2 Our Mandate / Purpose 3 Governance 4 Q&A 3
Slide 4: Historical Context
Historical Context Zurich Airport
Slide 5: For years we have been moving people and goods
1948 1953 For 1970 2001 1980 2020 75 years we have been moving people and goods
Slide 6: Working for all stakeholders
Working for all stakeholders A successful story since privatization more than 20 years ago 2000 2008 2020 Listing (IPO) of Opening of greenfield airport constructed Covid-19 with significant shares on the by Zurich Airport in Bangalore, India impact on all airports SIX Swiss Exchange; 2016 2019 Gran
Slide 7: Long-term shareholder returns
Long-term shareholder returns Excellent share price performance after survival of Swissair grounding • Consecutive increase of ordinary dividend from FY2005 until FY2018 CHF 223 • Suspension of dividend due to Covid-19 from FY2019 to FY2021 • Intention to become a reliable and attractive dividend pa
Slide 8: Our Mandate / Purpose
Our Mandate / Purpose Zurich Airport
Slide 9: Core mandate: operating the airport in accordance with our mandate
Core mandate Operating the airport in accordance with our mandate The aviation policy outlines the Swiss Federal Council's expectations of Zurich Airport as follows: “To satisfy the demand for direct connections to the world's major cities” Concession until 2051, Airport legislation, regulator (FOCA
Slide 10: We connect Switzerland to the world
We connect Switzerland to the world Reaching almost every place on earth 192 Direct connections to and from Zurich 59 Scheduled and charter airlines Oslo Stockholm Calgary London Warsaw Dublin Vancouver Vienna Chicago Montreal San Francisco New York Los Angeles Madrid Malta Seoul Washington Tokyo Or
Slide 11: The company’s purpose
The company’s purpose Strategy and values Shareholder value ad operating mandate 11
Slide 12: Governance
Governance Zurich Airport
Slide 13: Growth in light of conflicting interests
Growth in light of conflicting interests Balancing requirements / desires of many parties Public Politics & Regulator Safety & Security, Complexity Noise and Cost/Utility Environment Economy Shareholders & (Capacity) Capital market Neighbours & Regions 13
Slide 14: Shareholder structure
Shareholder structure Participation and role of the Canton of Zurich and the City of Zurich Shareholder Structure1 Role of Canton and City of Zurich Airport Act of the Canton of Zurich2: • §8 Canton is obliged to retain at least 33.3 percent plus one share of the share capital of Zurich Airport Ltd.
Slide 15: The Board of Directors
The Board of Directors Composition of elected and delegated members elected Josef Felder delegated Chairman Vincent Guglielmo Beatrix Frey- Stephan Claudia Corine Carmen Albers Brentel Eigenmann Gemkow Pletscher Mauch Walker Späh Canton of Zurich Independent Canton of Zurich Independent Independent
Slide 16: Q&A
16 Q&A Zurich Airport
Slide 17: Update on Strategic Topics
Investor Day 2023 Update on Strategic Topics Lukas Brosi, Chief Executive Officer September 4th, 2023
Slide 18: Content
Content Update on Strategic Topics 1 Strategy Overview 2 Recovery in core business 3 Focus Topics 4 Sustainability 5 Goals 6 Q&A 18
Slide 19: Strategy Overview
Strategy Overview Zurich Airport
Slide 20: Our business model based on four pillars
Zurich Airport Our business model based on four pillars Strategic International Aviation ZRH Commercial ZRH Real Estate ZRH Landscape Business Largest Swiss Airport Strong Contribution Strengthened Portfolio Active in Emerging Achieve- • Approximately 30 million • Leading commercial centers • Purcha
Slide 21: Strong recovery in core business
Strong recovery in core business 21
Slide 22: Offered seats summer 2023 vs. 2019: Top markets Europe
Offered seats summer 2023 vs. 2019: Top 10 markets Europe Southern Europe destinations with capacity buildup in 2023 Offered Seats 2023 vs. 2019 in % Highlights • Summer timetable capacity only slightly below pre-crisis levels • «Warm water destinations» United Offered Seats Europe Kingdom with incr
Slide 23: Offered seats summer 2023 vs. 2019: Intercontinental markets
Offered seats summer 2023 vs. 2019: Intercontinental markets China traffic still suffering from after-effects of late re-opening Offered Seats 2023 vs. 2019 in % Highlights • Recovery well Canada advanced in most (102%) intercontinental United Israel markets States China • Significant recovery (102%
Slide 24: Challenges
Challenges Faster than expected traffic recovery comes with new challenges Operational challenges Shareholder • Due to faster recovery than expected,value staff shortages throughout the whole airport ad operating mandate system have occurred • Longer queue times on average than pre-Covid; normalised
Slide 25: Focus Topics
Focus Topics Zurich Airport
Slide 26: The Circle
The Circle Minor adjustments needed The Circle had its official opening in November 2020, shortly after the pandemic broke out. Since then, most modules of the Circle have performed very well or better than expected, while others are not living up to the initial plans. Hence, a review concluded the
Slide 27: Runway Extensions
Runway Extensions Increased margin of safety for runways 28 and 32 More safety More punctuality More night rest No increase of capacity 27
Slide 28: Selection of other current projects in Zurich
Selection of other current projects in Zurich Working on all different fronts to optimize and improve our infrastructure Development of Landside New Baggage Sorting Zone West Terminal Projects Passenger Zones System • Create space for the • Airport-wide • Area for 14 stands for • Digitalization in g
Slide 29: ZRH Innovation Hub
ZRH Innovation Hub Strategy to be developed until end of year • The culture of innovation within the airport system should be strengthened and the «ZRH Innovation Hub» is to be founded • Focus: on customer experiences (passengers, shoppers, tenants) and efficiency for the benefit of Zurich Airport L
Slide 30: Expedite our digitalization process
Expedite our digitalization process ZRH3 as an example of the ZRH Innovation Hub • Achieving operational optimization of Shareholder value the overall system through data ad operating mandate exchange and analysis • Interfaces to important airport partners • Goal to increase capacity, safety and eff
Slide 31: Sustainability
Sustainability Zurich Airport
Slide 32: Sustainability at Zurich Airport
Sustainability at Zurich Airport Dual strategy • Reach net zero targets for Scopes 1 and 2 for Zurich Airport Ltd. at Zurich Airport • Reduction strategy is based on priority: 1. «Reduction»: Using less fuels and electricity 2. «Efficiency»: Increase efficiency in the use of fuel and electricity 3.
Slide 33: Goals
Goals Zurich Airport
Slide 34: Proven strategy only needs small changes
Proven strategy only needs small changes Focus on passenger convenience, quality of stay and innovation Existing strategy is clear and has proven itself through the crisis. Major strategic adjustments are not necessary. Goal: Intention to be among the top airports in Europe in the physical and virtu
Slide 35: Q&A
35 Q&A Zurich Airport
Slide 36: Project Update Noida incl. Financial Guidance
Investor Day 2023 Project Update Noida incl. Financial Guidance Daniel Bircher, MD International September 4th, 2023
Slide 37: Content
Content Project Update Noida 1 International Business 2 Noida International Airport 3 Conclusion 4 Q&A 37
Slide 38: International Business
38 International Business Zurich Airport
Slide 39: International Business Overview
International Business Overview Curaçao O&M, shareholding Bogotá Belo Horizonte O&M Noida (Delhi) shareholding shareholding Natal shareholding Vitória shareholding Iquique O&M, shareholding Macaé shareholding Antofagasta Regional Office O&M, shareholding Zurich Airport Latin America, Rio de Janeiro
Slide 40: Current portfolio of ten airports
International Business Current portfolio of ten airports Florianópolis International Airport, Brazil 2 regional airports in Brazil Natal International Airport, Brazil Belo Horizonte Int’l Airport, Brazil • 3.9 million passengers in 2019 • Vitória and Macaé (Southeast of Brazil) • 2.3 million passeng
Slide 41: Portfolio key strengths
International Business Portfolio key strengths • Geographic diversification: Focus on Brazil and India with significant development potential. Emerging Market • Portfolio diversification: Mix of brownfield and greenfield assets. Focus • Brazil: Largest aviation market in Latam (218 million passenger
Slide 42: Sustainability achievements
International Business Sustainability achievements Sustainable Airports Award1 1st: Macaé 1st: Florianópolis 2nd: Vitória Category: up to 0.2m passengers per year Category: up to 5m passengers per year 1 Awarded by ANAC, National Civil Aviation Agency of Brazil 42
Slide 43: Noida International Airport
Noida International Airport 43
Slide 44: Noida: Beginning / Situation
Noida: Beginning / Situation 44
Slide 45: Evolvement of project and business plan(s)
Noida International Airport Evolvement of project and business plan(s) 2019 2020 2021 2022 2023 • Elected as • Signed • Secured • Selected Tata • Award of sub- selected concession financing Projects Ltd. concession to bidder for agreement in from State as EPC1 Air India SATS concession to October 20
Slide 46: India aviation environment
India Aviation environment All India passenger traffic growth1 Fleet size of major Indian Carriers2 Approx. 1,700 aircraft on order 974 490 323 143 238 56 65 IndiGo TATA Group SpiceJet Akasa Air Current Fleet Size Orders Noida Airport is well positioned to meet the expected significant traffic deman
Slide 47: Noida International Airport Overview
Noida International Airport Overview A 40-Year Concession Capacity 12m Pax in 2024 To design, build and operate Phase 1 capacity for 12m a new greenfield annual passengers when international airport the airport opens at end for western of 2024. Grow to over Uttar Pradesh and National Capital 70m ann
Slide 48: To serve the travel needs of Uttar Pradesh and North India
Noida International Airport To serve the travel needs of the State of Uttar Pradesh and North India By road By air • Estimated population of 60-95 million within 120 minutes of travel time to Noida Airport • Serve as the primary international airport for major cities such as Noida, Meerut, Ghaziabad
Slide 49: Be the preferred gateway for tourism, business and cargo
Noida International Airport Be the preferred gateway for tourism, business and cargo • Gateway to pilgrimage and tourist destinations: Garhmukteswar − Agra is popular for the Taj Mahal (around 130 kilometers from Noida Airport). One of Hastinapur the 7 wonders of the world and attracts Ghaziabad Mee
Slide 50: Noida: Current Status
Noida: Current Status Zurich Airport
Slide 51: Masterplan phase I – initial layout
Noida International Airport Masterplan phase I – what will the initial layout look like? 51
Slide 52: Satellite Image
Satellite Image
Slide 53: Noida construction progress
Noida International Airport Construction progress Passenger Terminal Building Runway / Taxiway • Construction on track • Currently, Tata has mobilized around 6,000 workers on site • Commencement of installation, testing and commissioning of terminal and airside works by early 2024 Air Traffic Contro
Slide 54: Noida: Business plan
Noida: Business plan Zurich Airport
Slide 55: Financial guidance
Noida International Airport Financial guidance • Timeline: Tariff filing will be handed in in Q4 2023. After review of the regulator (AERA1), the tariff filing will be in public domain. • Control period(s): The tariff filing will only be for the first control period (5 years); however, the Process f
Slide 56: Financial guidance: traffic expectations
Noida International Airport Financial guidance: traffic expectations1 – clearly above bid estimate2 First control period Second control period 37.2 33.7 3.3 Expected to exceed already capacity of Phase I 29.7 2.8 First full year of traffic: 26.0 April 2025 to March 2026 22.2 (Indian financial year)
Slide 57: Financial guidance: Revenue and EBITDA estimate
Noida International Airport Financial guidance: Revenue and EBITDA estimate1 • At beginning, share of non-aviation revenues of total revenues is expected to be low (~20-25%) Estimated kick-in of EBITDA of around CHF 120m 55'917 • Mid- to longer-term increase of share of non- concession fee (initiall
Slide 58: Noida: Outlook
Noida: Outlook Zurich Airport
Slide 59: Forecourt
Forecourt
Slide 60: Departure Hall
Departure Hall
Slide 61: Security Check
Security Check
Slide 62: Immigration
Immigration
Slide 63: Full Phase I
Full Phase I
Slide 64: Short-term outlook
Noida International Airport Short-term outlook • Hand in tariff filing in Q4 2023 • Award of additional sub-concessions: − Into-plane fueling − Ground handling − F&B, retail, Duty free and other commercial concessions • Framework for airlines (aviation marketing) • Construction development: Commence
Slide 65: Long-term outlook – Delhi Region Airport System
Noida International Airport Long-term outlook – Delhi Region Airport System Delhi region to show strong passenger growth in the years to come Passengers handled by existing Indira Gandhi International Airport (IGI) 65 Source: Landrum & Brown analysis
Slide 66: Masterplan phase IV
Noida International Airport Masterplan phase IV – how does the airport may look like in a few decades? 66
Slide 67: Conclusion
67 Conclusion Zurich Airport
Slide 68: Conclusion: Noida is a key piece for the international strategy
Conclusion Noida is a key piece for the international strategy • International Business is one of the strategic pillars with sustainable growth Shareholder value potential for Zurich Airport Group ad operating mandate • International Business is expected to provide meaningful, stable and long-term r
Slide 69: Q&A
69 Q&A Zurich Airport
Slide 70: Financial Outlook
Investor Day 2023 Financial Outlook Kevin Fleck, Chief Financial Officer September 4th, 2023
Slide 71: Content
Content Financial Outlook 1 Financial Development Group 2 Costs (OPEX) 3 Capital Allocation 4 Mid-term EBITDA guidance 5 Conclusion 6 Q&A 71
Slide 72: Financial Development of Group
Financial Development of Group 72
Slide 73: Financial development of group
Financial development of group Revenue and EBITDA development since privatization Decision to increase Priora CAGR1 Revenue EBITDA GDP CH2 Pax ZRH CPI CH3 Total Revenue EBITDA international footprint purchase 2000-2019 4.5% 5.1% 2.2% 1.7% 0.4% 2000-2022 3.1% 3.7% 2.3% 0.0% 0.5% Record year Covid-19
Slide 74: Revenue split
Revenue split Development of the different revenue streams 2000 2000 2010 2010 2019 2019 2022 2022 10% 8% 14% 21% 10% 17% CHF CHF CHF CHF 48% 522.5m 53% 21% 851.6m 1,210.1m 55% 1,023.5m 63% 22% 21% 23% Aviation Commercial & Parking Real Estate Services International Non-Aviation With further diversi
Slide 75: Costs (OPEX)
Costs (OPEX) Zurich Airport
Slide 76: Cost control group
Cost control group High operating leverage with a substantial share of fixed costs CHF484m CHF485m CHF445m CHF455m CHF451m 46 41 41 39 CHF401m 33 45 44 CHF370m 35 38 43 39 41 43 35 38 30 39 40 34 120 121 122 118 105 94 85 197 201 211 216 197 179 171 2016¹ 2017¹ 2018¹ 2019 2020 2021 2022 Personnel ex
Slide 77: Capital Allocation
Capital Allocation Zurich Airport
Slide 78: Capital allocation: mid-term priorities
Capital allocation Mid-term priorities Capital allocation focused on value creation CAPEX ZRH • Executing on (delayed) projects in Zurich. Balanced Approach • Balance • Reinstated dividend payments with Debt Reduction / profitability, risk and expected pay-out of remaining capital Dividend contribut
Slide 79: CAPEX roadmap at Zurich Airport
CAPEX roadmap at Zurich Airport Largest projects in pipeline for next ten years Project Name up to 5 years 5 to 10 years 10+ years Baggage sorting system (Zone A) ~CHF 400m1 Development of landside passenger zones ~CHF 250m1 Stands (mainly Zone West) ~CHF 100m1 Main airport complex development ~CHF
Slide 80: CAPEX roadmap at Zurich Airport
CAPEX roadmap at Zurich Airport Investments expected to increase towards the end of decade New Dock A may lead to Completion of baggage pick up in CAPEX handling system FY2023 Guidance of 367 around CHF 200m 332 317 208 170 Completion of development landside passenger zones Runway extensions FY2018
Slide 81: Mid-term CAPEX roadmap outlook
Mid-term CAPEX roadmap outlook Group and international Group CAPEX 2023-20251 ~45% ~55% Zurich International Group CAPEX 2023-2025 Brazil Chile India • For the next three years, • Florianópolis: Limited • Antofagasta: No notable • Delhi Noida: Total international will show a CAPEX expected going inf
Slide 82: Dividend guidance
Dividend guidance What to expect mid-term? 6.9 6.4 6.5 For Financial Year 2018, i.e. payment in 2019 3.2 3.2 3.2 3.5 1.1 Dividend suspension 3.7 due to Covid-19 3.2 3.3 2.4 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023e FY2024e Ordinary Dividend per Share Additional Dividend per Share Rein
Slide 83: Mid-term EBITDA Guidance
Mid-term EBITDA Guidance Zurich Airport
Slide 84: Situation after recovery: incremental CHF 100m EBITDA guidance
Situation after recovery (2019 vs. full traffic recovery1) Incremental CHF 100m EBITDA guidance confirmed plus approx. CHF 100m ~CHF 50m Additional contribution International (mainly driven by Noida and ~CHF 20m Brazil) Priora real estate ~CHF 30m The Circle CHF 642m With traffic at pre-crisis level
Slide 85: Conclusion
85 Conclusion Zurich Airport
Slide 86: Conclusion: Building on our strong financial base
Conclusion Building on our strong financial base • Zurich Airport Ltd. is a very solvent company with a strong cash flow profile allowing to fund a good part of its investments internally Shareholder value ad operating mandate • Although costs are managed closely, they will increase going forward an
Slide 87: Q&A
87 Q&A Zurich Airport
Slide 88: Disclaimer
Disclaimer Forward-looking statements This document has been prepared by Flughafen Zürich AG for use in this presentation. The information contained in this document has not been independently verified. No representation or warranty – whether express or implied – is made as to, and no reliance shoul