Interim report January-June 2013

Transcription

1 Interim report January-June

2 Interim report January-June Second quarter, April-June Swedavia s airports had 9 million (8.6) 1 passengers during the second quarter, an increase of 4.1 per cent Net revenue increased to SEK 1,348 M (1,248) Operating profit increased to SEK 263 M (237), and profit for the period increased to SEK 166 M (131) On June 4, Swedavia acquired GE Capital s outstanding shares in the real estate company Nordic Airport Properties (NAP) On June 17, Swedavia sold Sundsvall Härnösand Airport to the Municipalities of Sundsvall and Timrå First six months, January-June Swedavia s airports had 16.2 million (16.1) passengers during the first six months of the year, an increase of 0.9 per cent Net revenue increased to SEK 2,561 M (2,408) Operating profit increased to SEK 408 M (374), and profit for the period was SEK 230 M (192) Key financial data, Group 2 2 SEK M Jan-Dec Net revenue 1,348 1,248 2,561 2,408 4,965 Operating profit Operating margin, % Profit before tax Profit for the period Earnings per share, SEK Return on equity Return on capital employed 4, % Equity/assets, % Cash flow from operating activities ,493 Capital spending 1,566 2,164 1,759 2,440 3,418 Average number of employees 5 2,534 2,501 2,615 2,581 2, Figures in parentheses give a comparison for the corresponding period the previous year, excluding liquidity and financial position, where the comparison is with the opening balance for the previous year. Comparative figures for have been restated to conform with IAS 19 Employee benefits; see below Note 2. Return on equity: Profit after tax for a rolling twelve-month period as a percentage of equity on the balance sheet date for the period. Return on capital employed: Profit after financial income for a rolling twelve-month period as a percentage of capital employed on the balance sheet date for the period. Starting with Q, the average number of employees is calculated based on the number of hours worked recalculated for the average number of employees as the total number of hours worked divided by the standard working time as defined by the Swedish Accounting Standards Board. Historical data have been recalculated. SWEDAVIA INTERIM REPORT JANUARY-JUNE 2

3 More intercontinental routes enhance Sweden s access The first six months of the year showed modest growth in passenger volumes, in line with our expectations. The number of international passengers increased, which provides a basis for additional international routes, especially at Stockholm Arlanda Airport. So far this year, seven new intercontinental routes have also been launched or announced by our airline customers. Traffic and earnings trends During the period, the number of passengers at Swedavia s airports was up one per cent. The growth was mostly in international passengers, with an increase of three per cent. The strongest growth was in European traffic, where the number of passengers rose four per cent during the first six months of the year. During the same period, the number of domestic passengers fell three per cent. In our view, international traffic will continue to show growth while domestic traffic should stabilise. During the period, Swedavia s revenue increased six per cent to SEK 2,561 M (2,408), while operating profit increased to SEK 408 M (374). The period was dominated by major investments to meet growing demand for air travel and the growing demand for commercial services at our airports. More connections outside Europe On May 21 and June 20, Norwegian Air Shuttle launched long-haul service to New York and Bangkok, respectively. The two routes increase capacity to the most popular destinations outside Europe. Emirates Airline announced that it will launch service on September 4 between Stockholm Arlanda Airport and Dubai. One of Swedavia s big challenges going forward is to continue expanding Swedish access by encouraging airlines to set up routes to new international destinations. There is good potential that this work, which is based on collaboration between businesses, public-sector organisations, cities, regions, Swedavia and other important national and regional stakeholders, will be successful. A more flexible property portfolio After acquiring the holdings of GEGAC Viking AB, as of June 4 Swedavia is the sole owner of Nordic Airport Properties (NAP). With this acquisition, there is increased potential for Swedavia s customers to develop their operations in properties well suited to their needs. This results in a more flexible real estate portfolio for Swedavia and gives it a clearer position especially at Stockholm Arlanda Airport and Göteborg Landvetter Airport. We are thus also laying the foundation for continued development of the airport cities that are now taking shape and creating the conditions to encourage our partners continued investment in infrastructure in line with growing demand. Passenger-friendly terminals In April, the new Terminal 2 at Stockholm Arlanda Airport was inaugurated. In addition to the potential for our partners business and growth, it provides an attractive atmosphere for both business and leisure travellers, particularly through an expanded offering of commercial services in the form of shops and restaurants. In many cases, we now can also offer passengers products from global brands, such as Capi, Lavazza Espression and Victoria s Secret, since these companies have chosen our airports as their primary location for starting up operations in Scandinavia. These openings confirm the attractiveness of our international hubs Stockholm Arlanda Airport and Göteborg Landvetter Airport. As we modernise and develop our airports, passenger satisfaction is also increasing. This was most apparent at Göteborg Landvetter Airport, where we are now close to achieving our Group-wide target of 80 per cent satisfied passengers. Continued improvement in Swedavia s overall customer satisfaction is anticipated as the work to modernise Kiruna Airport, Luleå Airport and Umeå Airport reaches completion. Meanwhile, an expansion of Terminal 5 at Stockholm Arlanda Airport is being evaluated in light of the strong growth in leisure travel. Continued improvement in financial efficiency During the first six months of the year, Swedavia continued to refinance earlier bank loans with more efficient capital market funding. At the end of the June, two thirds of Swedavia s borrowings consisted of commercial paper and notes, which has lowered our financial expenses, thereby creating more efficient and flexible conditions for developing operations. Transfer of Sundsvall Härnösand Airport On June 17, Swedavia sold Sundsvall Härnösand Airport to the Municipalities of Sundsvall and Timrå. As a result, Swedavia now operates Sweden s national basic infrastructure of ten airports, from Malmö in the south to Kiruna in the north, as part of the company s task. Our primary focus is to create the best possible access to, from and within Sweden through continued business development at these ten airports. At the same time, we will continue to be a role model in sustainable development. Torborg Chetkovich President and CEO SWEDAVIA INTERIM REPORT JANUARY-JUNE 3

4 Important events April-June The new Terminal 2 at Stockholm Arlanda Airport was inaugurated on April 23. The terminal has been expanded by more than 2,000 square metres and can now offer rapid, smooth flows as well as a broad range of venues for shopping, food and beverages. On June 4, Swedavia acquired the outstanding shares and participation rights in the real estate company NAP from GEGAC Viking AB. NAP owns and administers buildings and leases at Stockholm Arlanda Airport, Göteborg Landvetter Airport and Malmö Airport. In all, the company holds the equivalent of 81,000 square metres of cargo terminals and office space as well as about 100,000 square metres of apron area. The acquisition strengthens Swedavia s position and creates new opportunities for property development at these airports. On June 17, Swedavia sold Sundsvall Härnösand Airport to the Municipalities of Sundsvall and Timrå. As a result, Swedavia now operates Sweden s national basic infrastructure of ten airports, from Malmö in the south to Kiruna in the north, as part of the company s task. During the period, the Director of Human Resources, Charlotta Hyldal, resigned from Swedavia, thus stepping down from her executive management position. Recruitment of a new HR Director is underway, and until her replacement takes over, the Procurement Director, Anders Hjertman, will also assume the position of acting HR Director. In May, Swedavia issued two 3-year notes totalling SEK 700 M as well as a 5-year note totalling SEK 500 M. January-June The new international departure hall at Göteborg Landvetter Airport was officially inaugurated on February 19. The departure hall has 1,000 square metres of new space with a new shopping thoroughfare, a wider range of restaurants and shops on offer, and a brand-new environment that meets the highest international standards. Construction was underway for about a year, and new commercial venues gradually opened up during this time. The refurbishment of the new departure hall, combined with the new security checkpoint for international passengers inaugurated a year ago, is the biggest change to take place at the airport since it opened in During the first quarter, Swedavia strengthened its executive management team. Lars Johansson, most recently at TV4 AB, took over as the new CFO on March 18. Karl Wistrand, deputy CEO and formerly CFO of Swedavia, assumed the position of CEO of Swedavia Real Estate on February 4,. He retains his position as deputy CEO of Swedavia AB and is responsible for pricing strategy as well as the Group s overall business development. During the first six months of the year, Swedavia continued to refinance previous bank loans with more efficient capital market funding through commercial paper and corporate notes. The notes are listed on the NASDAQ OMX Stockholm exchange. Events after the balance sheet date There are no important events to report. SWEDAVIA INTERIM REPORT JANUARY-JUNE 4

5 Passenger trends April-June The number of passengers increased about four per cent during the second quarter of the year, as a result of significant increases in capacity by airlines and sustained sharp growth in demand. Adjusted for calendar effects, the comparable increase in passenger volume was three per cent, with international traffic increasing five per cent and no change in domestic traffic. The growth in international traffic means that a new alltime record was set for the third straight year. Since the market bottomed during the financial crisis in 2009, volume has risen almost 35 per cent. This trend is characterised by very strong demand, with the number of passengers increasing at the same rate as available capacity. That means the average cabin factor is relatively constant and, adjusted for the calendar effects above, is at a record level for both international and domestic traffic. The growth in international traffic is driven largely by increases in scheduled European service at Stockholm Arlanda Airport, Göteborg Landvetter Airport and Malmö Airport. Five destinations together account for over half of this growth London, Berlin, Istanbul, Paris and Barcelona. With the exception of Istanbul, these destinations have three airlines competing at Swedavia s airports; Berlin has as many as four competitors serving the route from Stockholm Arlanda Airport. For some airports, such as Umeå Airport, Luleå Airport and Visby Airport, charter operations also contributed to increases in international traffic. Declines in international traffic were only noted at Bromma Stockholm Airport, where the number of international routes fell compared to last year. January-June The first six months of the year were characterised by a weaker first quarter and a strong second quarter. International traffic was up one per cent in the first quarter and five per cent in the second quarter, which means an increase of three per cent for the first six months of the year. Domestic traffic also saw gains, with a decrease of about five per cent in the first quarter improving to an increase of about two per cent in the second quarter. The acceleration in traffic growth began in conjunction with the switch to the summer timetable at the end of March, when the number of passengers quickly reached the same rate of growth as the airlines rate of capacity expansion. Passenger volumes Swedavia s eleven airports. April-June and January-June 6) Number of passengers, Passengers Change in percent Number of passengers, Change in percent International 5,614,000 5,325, % 9,902,000 9,581, % Domestic 3,375,000 3,309, % 6,309,000 6,482, % Total 8,989,000 8,634, % 16,211,000 16,063, % 6 Compared to the same period in. Sundsvall Härnösand Airport is included in passenger statistics up until the date of sale. SWEDAVIA INTERIM REPORT JANUARY-JUNE 5

6 Economic overview Consolidated net revenue and profit April-June Consolidated net revenue for the second quarter totalled SEK 1,348 M (1,248), an increase of 8 per cent. Operating profit totalled SEK 263 M (237), an increase of 11 per cent. The operating margin was 19.5 per cent (19.0). Profit before tax was SEK 211 M (184). Profit for the period totalled SEK 166 M (131). Net revenue was up SEK 100 M compared to the same period in. SEK 80 M of this increase is rental income from Real Estate operations, which started up in Q3. That means revenue from Airport Operations increased SEK 20 M. The increase in passengers led to an increase of SEK 7 M in aviation revenue, SEK 15 M in car parking revenue and SEK 8 M in revenue from retail operations. Other rental income increased SEK 4 M. However, the sale of conference operations at Stockholm Arlanda Airport last year meant a fall in revenue of SEK 10 M compared to the previous year. External costs were up SEK 35 M during the second quarter compared to last year. SEK 13 M of this increase consists of costs attributable to Real Estate so the comparable increase in costs was SEK 22 M. This is explained mostly by an increase in consulting fees, mainly for IT, as a result of the division of LFV into two separate entities, as well as some non-recurring costs. Staff expenses increased SEK 7 M, with SEK 1 M of this attributable to Real Estate. Adjusted for a revaluation of pension expenses last year in accordance with IAS, the comparable cost increased SEK 2 M. Staff expenses thus increased less than is explained by salary increases, which is a result of there being fewer employees. Depreciation and amortisation increased SEK 33 M, with SEK 21 M of this attributable to Real Estate. The rest can be attributed to the increased rate of capital spending in Airport Operations. Operating profit was SEK 26 M higher than for the same period in. Real Estate accounts for SEK 45 M of this, which means that operating profit from comparable operations fell SEK 15 M after adjustments for non-recurring costs attributable to a revaluation in pensions under IAS 19 in. Net financial items totalled SEK -52 M (-53). Interest expenses increased during the period compared to last year as a result of increased external borrowings for Real Estate. The increase in interest expenses, however, was partly offset by new, more effective funding. Capital spending During the second quarter, investments totalled SEK 1,566 M (2,164). The single largest investment during the period, SEK 1,284 M, is attributable to the acquisition of outstanding shares in NAP. Cash flow Cash flow for the second quarter totalled SEK 146 M (178). Cash flow from operating activities was SEK 459 M (507). Investing activities used cash of SEK -1,389 M (-2,170) while financing activities contributed cash of SEK 1,076 M (1,841). Employees The average number of employees during the second quarter was 2,534 (2,501). January-June Consolidated net revenue for the first six months totalled SEK 2,561 M (2,408), an increase of 6.3 per cent. Operating profit totalled SEK 408 M (374), an increase of 9.2 per cent. The operating margin was 15.9 per cent (15.5). Profit before tax was SEK 294 M (267). Profit for the period totalled SEK 230 M (192). Net revenue was up SEK 153 M compared to the same period in. SEK 141 M of this increase is rental income from Real Estate operations, which started up in Q3. That means comparable revenue increased SEK 12 M. The increase consists largely of car parking revenue and rental income from retail, food and beverage operations, which was up SEK 26 M, driven by higher passenger volume. However, the sale of conference operations at Stockholm Arlanda Airport last year entailed a fall in revenue of SEK 20 M compared to the previous year. External costs increased SEK 56 M during the first six months of the year compared to. SEK 28 M of this increase consists of costs attributable to Real Estate, equivalent to an increase in costs of 3 per cent. Staff expenses increased SEK 16 M compared to, with SEK 4 M of this attributable to Real Estate. Adjusted for pension expenses last year, the comparable figure for staff expenses is SEK 4 M higher. The average number of employees fell compared to last year. Depreciation and amortisation increased SEK 47 M, with SEK 33 M of this attributable to Real Estate. The remaining increase can be attributed to the increased rate of capital spending in the Airport Operations segment. Operating profit was SEK 34 M higher than for the same period last year. Of this total, Real Estate 76 M, which means that comparable operating profits from airport operations decreased by 42 M. Net financial items totalled SEK -114 M (-107). Interest expenses increased during the period compared to last year as a result of increased external borrowings for Real Estate. The increase in interest expenses, however, was partly offset by new, more efficient funding. Capital spending During the first six months of the year, investments totalled SEK 1,759 M (2,440). The single largest SWEDAVIA INTERIM REPORT JANUARY-JUNE 6

7 investment during the period, SEK 1,284 M, is attributable to the acquisition of outstanding shares in NAP. Cash flow Cash flow for the first six months of the year totalled SEK 132 M (152). Cash flow from operating activities was SEK 441 M (674). Investing activities used cash of SEK -1,590 M (-2,446) while financing activities contributed cash of SEK 1,281 M (1,924). Employees The average number of employees during the first six months of the year was 2,615 (2,581). Liquidity and financial position Consolidated equity at the end of June was SEK 4,608 M (4,300), and the Group s equity/asset ratio was 28.5 per cent (29.1), This ratio decreased as a result of increased external borrowings to fund the acquisition of NAP. At the end of June, Swedavia had unutilised credit facilities totalling SEK 710 M divided into loan commitments of SEK 500 M and unused overdraft facilities of SEK 210 M. During the first six months of the year, Swedavia issued commercial paper and notes totalling SEK 4,878 M. The proceeds refinance earlier bank loans. In all, Swedavia s borrowings have increased SEK 1,291 M in to SEK 8,944 M. Of this, SEK 919 M is attributable to NAP s existing borrowings. Acquisitions and divestments On June 4, Swedavia acquired the outstanding shares and participation rights in the real estate company NAP from GEGAC Viking AB. NAP owns and administers buildings and leases at Stockholm Arlanda Airport, Göteborg Landvetter Airport and Malmö Airport. In all, the company holds the equivalent of 81,000 square metres of cargo terminals and office space as well as about 100,000 square metres of apron area. The acquisition strengthens Swedavia s position and creates new opportunities for property development at these airports. On June 17, Sundsvall Härnösand Airport was sold to the Municipalities of Sundsvall and Timrå. implementing its strategies. Swedavia works continuously to map, monitor and manage risks in its operations. Swedavia s significant risks are described in the Annual Report on page 47 and in Note 33 on pages Swedavia performs risk analyses regularly which are reported to the Board of Directors on a quarterly basis. The greatest risk for Swedavia concerns the environmental permit for Stockholm Arlanda Airport. The period was dominated by continued economic uncertainty. However, passenger volumes increased, particularly for international passengers. Swedavia believes that the general economic trend remains uncertain, which could have an adverse effect on Swedavia in the form of reduced demand for air travel and thus lower revenue. Ongoing litigation and disputes Swedavia is a party to ongoing litigation and disputes. The disputes have arisen as part of the day-to-day operations Swedavia carries out. Legal proceedings and disputes are unpredictable by nature, and the actual outcome may differ from the assessments that Swedavia has made. Events after the balance sheet date There have been no important events since the balance sheet date. Parent Company Net revenue and profit April-June The Parent Company s net revenue for the second quarter totalled SEK 1,266 M (1,245). Operating profit was SEK 192 M (219). The operating margin was 15.2 per cent (17.6). Profit before tax was SEK 161 M (180). Profit for the period was SEK 130 M (134). January-June The Parent Company s net revenue for the first six months of the year totalled SEK 2,418 M (2,406). Operating profit was SEK 299 M (340). The operating margin was 12.4 per cent (14.1). Profit before tax was SEK 231 M (233). Profit for the period was SEK 188 M (172). Risks and uncertainty factors Risk is defined here as an event that affects the Group s prospects of achieving its operational goals and SWEDAVIA INTERIM REPORT JANUARY-JUNE 7

8 Financial data for Swedavia Consolidated income statement Amounts in SEK M Note 6) 6) Jan-Dec Net revenue 3,8 1,348 1,248 2,561 2,408 4,965 Operating costs External costs ,890 Staff expenses ,394 Depreciation/amortisation and impairment losses on tangible fixed and intangible noncurrent assets, Operating profit Income from financial investments Profit on holdings in associated companies Interest income and similar items Interest expenses and similar items Income from financial investments Tax Profit for the period Attributable to non-controlling interests Earnings per share Earnings per share before and after dilution, SEK The number of shares is 1,441,403,026 for all periods Consolidated statement of comprehensive income Note 6 6 Jan-Dec Profit for the period Other comprehensive income Items that can be reclassified in the income statement Fair value changes in cash flow hedges for the period Tax Items that cannot be reclassified in the income statement Revaluation of defined benefit pensions Tax Total other comprehensive income, net after tax Total profit for the period Attributable to non-controlling interests Comparative figures for have been restated in conformity with IAS 19 Employee benefits; see Note 2 below. SWEDAVIA INTERIM REPORT JANUARY-JUNE 8

9 Consolidated balance sheet Amounts in SEK M Note ASSETS NON-CURRENT ASSETS Intangible non-current assets Goodwill Other intangible non-current assets Total intangible non-current assets Tangible fixed assets Buildings and land 8,715 6,699 7,585 Field structures 2,265 2,386 2,412 Biological assets, standing timber Electrical installations, vehicles and equipment 1,931 1,909 1,999 New construction in progress related to tangible fixed assets 1,348 1, Total tangible fixed assets 14,350 12,539 13,040 Financial non-current assets Holdings in associated companies Other non-current receivables Derivative instruments Deferred tax credit Total financial non-current assets Total non-current assets 14,940 13,252 13,708 CURRENT ASSETS Materials and stocks Current receivables Trade receivables Receivables from associated companies Tax assets Other receivables Prepaid expenses and accrued income Cash and bank holdings Total current assets 1,223 1,042 1,080 TOTAL ASSETS 16,163 14,294 14,788 SWEDAVIA INTERIM REPORT JANUARY-JUNE 9

10 Consolidated balance sheet (cont.) Amounts in SEK M Note EQUITY AND LIABILITIES Equity Share capital (1,441,403,026 shares) 1,441 1,441 1,441 Other paid-in capital 2,62 2,162 2,162 Hedge reserve Retained earnings 1, Total equity attributable to the Parent Company s shareholders 4,602 4,159 4,290 Total equity Total equity 4,608 4,164 4,300 Non-current liabilities Provisions for pensions and similar obligations Provisions for deferred tax Other provisions Liabilities to credit institutions 6,296 3,200 3,000 Derivative instruments Liabilities to leasing companies Other non-current liabilities Total non-current liabilities 7,688 4,461 4,413 Short-term liabilities Interest-bearing liabilities Liabilities to credit institutions 2,648 4,543 4,653 Liabilities to leasing companies Non-interest-bearing liabilities Derivative instruments Trade liabilities Liabilities to associated companies Other liabilities Accrued expenses and prepaid income Total short-term liabilities 3,867 5,669 6,075 TOTAL EQUITY AND LIABILITIES 16,163 14,294 14,788 Assets pledged and contingent liabilities Amounts in SEK M Note Assets pledged Contingent liabilities SWEDAVIA INTERIM REPORT JANUARY-JUNE 10

11 Changes in equity Amounts in SEK M Other paid-in Share capital capital Hedge reserve RetainedNon-controlling earnings interest Total capital GROUP Equity, opening balance 1,441 2, ,300 Dividend paid Transfer Total profit for the period Equity, closing balance ,441 2, , ,608 Consolidated cash flow statement Amounts in SEK M Note Jan-Dec Operating activities Income from financial investments Adjustments for items not included Cash flow from operating activities before changes in working capital Cash flow from changes in working capital ,188 Increase( )/Decrease(+) in inventories Increase( )/Decrease(+) in operating receivables Increase(+)/Decrease( ) in operating liabilities Cash flow from operating activities ,493 Investing activities Acquisition/divestment of intangible noncurrent assets Acquisition/divestment of tangible fixed assets -1,480-2,170-1,676-2,446-3,383 Acquisition/divestment of financial assets Cash flow from Investing activities -1,389-2,170-1,590-2,446-3,341 Financing activities Borrowings raised 3,153 2,720 7,810 5,161 4,135 Borrowings repaid -2, ,519-3,227-2,290 Dividend paid Cash flow from financing activities 1,076 1,841 1,281 1,924 1,836 Cash flow for the period Liquid assets at the beginning of the period Liquid assets at the end of the period SWEDAVIA INTERIM REPORT JANUARY-JUNE 11

12 Parent Company income statement Amounts in SEK M Note Jan-Dec Net revenue 1,266 1,245 2,418 2,406 4,868 Operating costs External costs ,909 Staff expenses ,418 Depreciation/amortisation and impairment losses on tangible fixed and intangible noncurrent assets Operating profit Income from financial investments Profit on holdings in Group companies Profit on holdings in associated companies Interest income and similar items Interest expenses and similar items Income from financial investments Appropriations Accelerated depreciation Change in tax allocation reserve Group contribution Profit before tax Tax Profit for the period SWEDAVIA INTERIM REPORT JANUARY-JUNE 12

13 Parent Company balance sheet Amounts in SEK M Note ASSETS NON-CURRENT ASSETS Intangible non-current assets Goodwill Other intangible non-current assets Total intangible non-current assets Tangible fixed assets Buildings and land 4,811 4,857 5,162 Field structures 2,265 2,386 2,412 Electrical installations, vehicles and equipment 1,931 1,909 1,999 New construction in progress related to tangible fixed assets 1,315 1, Total tangible fixed assets 10,323 10,609 10,526 Financial non-current assets Holdings in Group companies Receivables from Group companies 5 2,478 1,833 1,947 Holdings in associated companies Other non-current receivables Deferred tax credit Total financial non-current assets 3,540 2,757 3,015 Total non-current assets 14,373 13,884 14,072 CURRENT ASSETS Materials and stocks Current receivables Trade receivables Receivables from Group companies Receivables from associated companies Tax assets Other receivables Prepaid expenses and accrued income Cash and bank holdings Total current assets 2,013 1,039 1,667 TOTAL ASSETS 16,385 14,923 15,739 SWEDAVIA INTERIM REPORT JANUARY-JUNE 13

14 Parent Company balance sheet (cont.) Amounts in SEK M Note EQUITY AND LIABILITIES Equity Share capital (1,441,403,026 shares) 1,441 1,441 1,441 Retained earnings/share premium 1,873 1,825 1,829 Profit for the period Total equity 3,502 3,438 3,314 Untaxed reserves Accumulated accelerated depreciation 1, ,152 Tax allocation reserve Total untaxed reserves 1, ,201 Provisions Provisions for pensions and similar obligations 1,082 1,010 1,085 Other provisions Total provisions 1,238 1,135 1,276 Non-current liabilities Interest-bearing liabilities Liabilities to credit institutions 5,397 3,200 3,000 Liabilities to leasing companies Other non-current liabilities Total non-current liabilities 5,431 3,234 3,035 Short-term liabilities Interest-bearing liabilities Liabilities to credit institutions 2,628 4,543 4,653 Liabilities to leasing companies Non-interest-bearing liabilities Trade payables Liabilities to Group companies 1, ,011 Liabilities to associated companies Other liabilities Accrued expenses and prepaid income Total short-term liabilities 5,013 6,176 6,913 TOTAL EQUITY AND LIABILITIES 16,385 14,923 15,739 Assets pledged and contingent liabilities Amounts in SEK M Note Assets pledged Contingent liabilities SWEDAVIA INTERIM REPORT JANUARY-JUNE 14

15 Changes in equity Amounts in SEK M Share capital Share premium PARENT COMPANY Retained earnings Total capital Equity, opening balance 1,441 2, ,314 Profit for the period Equity, closing balance ,441 2, ,502 Parent Company cash flow statement Amounts in SEK M Jan-Dec Operating activities Income from financial investments Adjustments for items not included Cash flow from operating activities before changes in working capital Cash flow from changes in working capital ,267 Increase( )/Decrease(+) in inventories Increase( )/Decrease(+) in operating receivables Increase(+)/Decrease( ) in operating liabilities ,197 Cash flow from operating activities ,772 Investing activities Paid-in shareholder contribution Non-current receivables, subsidiaries , ,783-1,897 Acquisition of intangible non-current assets Acquisition of tangible fixed assets ,006 Divestment of tangible fixed assets Acquisition/divestment of financial assets Cash flow from Investing activities , ,003-3,634 Financing activities Profit on merger Borrowings raised 2,234 3,252 6,891 5,692 4,135 Borrowings repaid -2, ,519-3,227-2,290 Cash flow from financing activities 166 2, ,465 1,848 Cash flow for the period Liquid assets at the beginning of the period Liquid assets at the end of the period SWEDAVIA INTERIM REPORT JANUARY-JUNE 15

16 Notes Note 1 Corporate information Swedavia AB (publ.), Swedish corporate identity number , has its registered office in the Municipality of Sigtuna, Sweden. The address of the company s head office is: Stockholm-Arlanda, Sweden. The company is wholly owned by the Swedish State and was formerly part of LFV until April 1, 2010, when LFV s airport operations were converted into a limited liability company. The company is entrusted with the task of owning, operating and developing airports in Sweden s national basic infrastructure as determined by the Government. As of June 30,, there were ten airports included in the national basic infrastructure as determined by the Government: Bromma Stockholm Airport, Göteborg Landvetter Airport, Kiruna Airport, Luleå Airport, Malmö Airport, Ronneby Airport, Stockholm Arlanda Airport, Umeå Airport, Visby Airport and Åre Östersund Airport. Swedavia also owns the property Göteborg City Airport and is a minority shareholder in the company that operates the airport. Note 2 Accounting principles General The interim report for the first six months of was prepared in conformity with IAS 34 and Sweden s Annual Accounts Act. The interim report is prepared in conformity with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB), to the extent these have been adopted by the EU, as well as interpretations of standards in effect issued by the IFRS Interpretations Committee (IFRIC) that have been adopted by the EU. Tax on the profit in the interim report was calculated at the tax rate that was expected to apply for the full year with respect to appropriations. All amounts in the Group s financial reports are in Swedish kronor (SEK M) unless otherwise noted. Rounding differences may occur. New and changed standards IAS 19 Employee benefits As a result of the EU s adoption of the revised IAS 19 which entered into force on January 1,, Swedavia decided to apply the standard in advance in its year-end report. That means a change in accounting principles compared to interim reports published previously in. Actuarial gains and losses resulting from changes in actuarial assumptions are now reported in other comprehensive income during the period they arise. Actuarial gains and losses have been broken down by quarter based on the interest rate trend during the year. Breakdown, SEK M Actuarial change Jan- Mar Apr- Jun Jul- Sep Oct- Dec Jan- Dec Related party transactions The Group has transactions with related State-owned companies and enterprises. Revenue consists of remuneration for Aviation Business and Commercial Services. Costs consist mostly of meteorological services, fees to government authorities and air navigation services. Parent Company The Parent Company applies Sweden s Annual Accounts Act and the Swedish Financial Accounting Standards Council s recommendation RR 2 Financial reporting for legal entities. The differences arising between the accounting principles of the Parent Company and the Group are caused by the limited ability to apply IFRS in the Parent Company as a result of Sweden s Annual Accounts Act and the Swedish Pension Obligations Vesting Act as well as in some cases by the relationship between financial reporting and taxation. Note 3 Segment reporting An operating segment is defined as a component of an entity that engages in business activities from which it may earn revenues and incur expenses, whose operating results are reviewed regularly by the entity s chief operating decision-maker and for which discrete financial information is available. As of July 1,, the Swedavia Group is organised and managed as two business activities and operating segments, which are Airport Operations and Real Estate. Until July 1, Swedavia s operations consisted solely of Airport Operations, which then constituted the Group s only operating segment. The basis of segment reporting is the Group s internal reporting. The Board of Directors and executive management mainly use operating profit by segment for monitoring. Financial expenses, financial income and income tax are handled at the Group level. The accounting principles conform with those applied in consolidated financial reporting, with the exception of goodwill impairment, unrealised fair value changes which are not covered by hedge accounting, actuarial gains and losses on pensions and fair value changes in standing timber. The Swedavia Group is managed and reported in two operating segments. Airport Operations owns, operates and develops Swedavia s airports Real Estate owns, develops and manages properties and developable land at and in the vicinity of Swedavia s airports SWEDAVIA INTERIM REPORT JANUARY-JUNE 16

17 Segment reporting Income statement 8 Amounts in SEK M Airport Operations Real Estate Eliminations 9 Swedavia Total Revenue from external customers 1,268 1, ,348 1,248 Revenue from other segments Total revenue 1,268 1, ,348 1,248 Operating costs Depreciation, amortisation and impairment losses Operating profit Income statement 8 Amounts in SEK M Airport Operations Real Estate Eliminations 9 Swedavia Total Revenue from external customers 2,420 2, ,561 2,408 Revenue from other segments Total revenue 2,420 2, ,561 2,408 Operating costs -1,674-1, ,707-1,634 Depreciation, amortisation and impairment losses Operating profit Comparative figures for have been restated in conformity with IAS 19 Employee benefits; see Note 2 below. Eliminations consist of intra-group transactions and adjustments for differences between Swedish accounting principles and IFRS. As of July 1,, Swedavia s operations are organised and managed under two operating segments. Prior to this, Swedavia s operations consisted solely of Airport Operations, which then constituted the Group s only operating segment. Note 4 Asset acquisitions Through its subsidiary Swedavia Real Estate AB, on June 4 Swedavia acquired the outstanding 50 per cent of shares and participation rights in the associated companies NAP AB and NAP KB. Swedavia thus holds 100 per cent of the companies, which own office and cargo buildings at Stockholm Arlanda Airport, Göteborg Landvetter Airport and Malmö Airport. Swedavia already owned the land the buildings are on. The acquisition of the outstanding shares and participation rights totalled SEK 260 M. Possession was taken and full consolidation of NAP, which was previously reported as an associated company, took effect on June 1. Swedavia s cost for the buildings acquired totalled SEK 1,284 M and is reported in Swedavia as tangible fixed assets, mostly as buildings. Deferred tax is not reported since the acquisition is the result of a transaction that constitutes the first reporting of an asset that is not a business combination and which, at the time of the transaction, affects neither reported profit nor taxable profit. The acquisition of assets was funded by borrowings taken over by Swedavia and by external borrowings. Note 5 Holdings in and receivables from Group companies During the year, Swedavia AB paid in an unconditional shareholders contribution to Swedavia Real Estate AB totalling SEK 81 M. Receivables, non-current and current, from Group companies pertain to loans funding the Swedavia Real Estate group. Note 6 Financial instruments Derivative instruments are used to manage interest risk exposure, currency risk and commodity risk exposure for electricity. Valuation at fair value For current receivables and liabilities, such as trade receivables and trade payables, with a remaining life of less than six months, the recognised value is considered to reflect the fair value. Fair value for interest-bearing liabilities is calculated by discounting the future cash flow of the amount of SWEDAVIA INTERIM REPORT JANUARY-JUNE 17

18 capital and interest discounted at the current market interest rate. All derivatives on the balance sheet date are classified under Level 2, which means the derivatives can be measured through directly or indirectly quoted prices based on observable market data. The Group has entered ISDA agreements for derivatives which allows set-off. Fair value, financial instruments Amounts in SEK M Loan receivables and trade receivables Other financial liabilities -9,477-8,439 Derivatives Total -8,880-7,952 Total book value -8,449-7,917 Note 7 Contingent liabilities Swedavia has contingent liabilities in the form of pension obligations in endowment insurance owned by the company. Swedavia also has a loss guarantee for the associated company Cityflygplatsen i Göteborg AB. Swedavia furthermore has contingent liabilities related to environmental requirements for operating airports. Note 8 Net revenue Consolidated, amounts in SEK M Breakdown of revenue Aviation Business Jan-Dec Passenger-related revenue ,849 Operations-related revenue Ground handling & aircraft parking Other aviation ,381 1,382 2,749 Commercial Services Car parking Retail, food & beverage Other property revenue Advertising Other commercial services , ,134 Other revenue Total 1,348 1,248 2,561 2,408 4, In the second quarter of, non-recurring income of SEK 7 M from the sale of land at Göteborg Landvetter Airport was reported. In the fourth quarter of, non-recurring income of SEK 48 M from the sale of conference operations at Stockholm Arlanda Airport was reported. SWEDAVIA INTERIM REPORT JANUARY-JUNE 18

19 Note 9 Definitions Aviation Business Infrastructure services aimed at airlines and ground handling companies, such as take-off and landing services and security screening. Capital employed Total assets minus non-interest-bearing liabilities (including deferred tax liability). Commercial Services Services connected to the airports such as rental of premises for commercial activities, offices, hotels, storage and logistics as well as leaseholds, parking operations and rental of advertising space. Earnings per share Profit for the period divided by the average number of shares. Operating margin Operating profit as a percentage of net revenue. Profit for the period Profit after tax. Return on capital employed Profit for the period for a rolling 12-month period as a percentage of capital employed on the balance sheet date. Return on equity Profit for the period for a rolling 12-month period as a percentage of equity on the balance sheet date. Swedavia Real Estate Owns, operated and develops property and developable land at and in the vicinity of Swedavia s airports. Equity/assets ratio Adjusted equity as a percentage of total assets on the balance sheet date. SWEDAVIA DELÅRSRAPPORT JANUARY-JUNE 19

20 Financial reports Calendar Interim report Jan-Sep Year-end report Annual report Swedavia s financial reports are published on Swedavia s website This interim report has not been subject to a review by Swedavia s auditors. Contact people Questions may be addressed to: Torborg Chetkovich President and CEO Lars Johansson CFO Telephone +46 (0) The undersigned affirm that this interim report gives a fair overview of the operations, financial position and profits of the Parent Company and Group operations and describes important risks and uncertainty factors faced by the Parent Company and the companies included in the Group. Stockholm-Arlanda August 15, Ingemar Skogö Karin Apelman Lars Backemar Chairman of the Board Board member Board member Anders Ehrling Anna Elgh Adine Grate Axén Board member Board member Board member Hans Jeppson Jenny Lahrin Lottie Svedenstedt Board member Board member Board member Lars Andersson Robert Olsson Torborg Chetkovich Board member Board member, President and CEO Employee representative Employee representative SWEDAVIA INTERIM REPORT JANUARY-JUNE 20