Analysts Presentation 2011 Full Year Financial Results

Transcription

1 Analysts Presentation 2011 Full Year Financial Results Thomas E. Kern Chief Executive Officer Daniel Schmucki Chief Financial Officer Zurich Airport

2 Schedule 1. Full Year Highlights 3 2. Full Year Key Data 4 3. Aviation 8 4. Non-Aviation Financial Key Figures Other Key Topics Outlook Your Questions Full Year Financial Results

3 1. Full Year Highlights Standard and Poor s revises rating: BBB+ to A- Issuing of CHF 250 million bond Opening of first Arrival Duty Free Stores in Switzerland Best Airport in Europe ; ZRH wins World Travel Award for the 8 th time in succession Submission of building application for the real estate project The Circle Clear Commitment to Zurich Airport from the voters of Zurich (rejection Behördeninitiative II ) Opening new Dock B & Security Check Building Formal expropriation payments: Final judgement of the Swiss Federal Court on December 9, 2011 Passenger record: Total 24.3 million passengers Strong Financial Year Full Year Financial Results

4 2. Full Year Key Data Full Year Financial Results

5 Full Year Traffic in millions Jan-Dec 2011 Jan-Dec 2010 Delta Local passengers % Transfer passengers % Transfer share 34.0% 34.6% Total passengers % Movements (in thousand) % whereof Line & Charter movements % Cargo (in thousand tons) % Full Year Financial Results

6 Full Year Financial Results in million CHF Jan - Dec 2011 Jan- Dec 2010 Delta Aviation revenue % Non-Aviation revenue % Revenue % EBITDA % EBITDA margin 53.6% 51.3% EBIT % EBIT margin 31.3% 28.9% Net profit % Interest-bearing liabilites % Cash flow from operating activities % CAPEX % EpS (in CHF) % Full Year Financial Results

7 Full Year Financial Results (without noise impact) in million CHF Jan-Dec 2011 w/o noise Jan-Dec 2010 w/o noise Delta Aviation revenue % Non-Aviation revenue % Revenue % EBITDA % EBITDA margin 51.4% 49.9% EBIT % EBIT margin 28.8% 27.3% Net profit % Interest-bearing liabilites 1' % Cash flow from operating activities % CAPEX % EpS (in CHF) % Full Year Financial Results

8 3. Aviation Full Year Financial Results

9 Passengervolume and Benchmark Europe 2011 (PAX* in millions) 2011 % vs % vs % vs % vs ZRH % 11.0% 10.1% 17.4% AMS % 14.1% 4.8% 4.1% BRU % 10.8% 1.3% 4.8% CDG % 5.4% 0.4% 2.0% CPH % 15.3% 5.6% 6.2% FRA % 11.2% 5.7% 4.5% LHR % 5.3% 3.7% 2.3% MAD % 3.3% -1.9% -4.3% MXP % 10.0% 0.4% -19.5% MUC % 15.3% 9.2% 11.0% VIE % 16.6% 6.9% 12.4% * Terminal PAX, Source ACI (Airports Council International), Rapid Data Exchange Program Full Year Financial Results

10 Aviation Segment Revenue Breakdown Strong passenger demand as groundwork for revenue growth Heavier aircraft led to increase of average fee per landing Revised split of noise charges with Canton ZH* Decrease of other revenue due to mild winter months (less de-icings) * 72% (53%) to FZAG as of January 1, Full Year Financial Results in million CHF Jan-Dec Jan-Dec Delta Passenger fees % Security fees % PRM fees % Landing fees % Noise charges % Emission fees % Parking fees % Fuel fees % Freight fees % Baggage sorting % Aircraft energy supply % Others % Total % Ø Landing charge per movement (CHF) %

11 Passengers by Customer Segments Star Alliance % 2011 (6.2 % vs. 2010) Low Cost Carrier 11.2% (9.5 % vs. 2010) One World 4.2% (3.0 % vs. 2010) Sky Team 3.9% (3.8 % vs. 2010) Star Alliance Member represent: 13% 6% 81% Charter 1.8% (24.7 % vs. 2010) Swiss Lufthansa Others 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% ( % vs. 2010) = Changes in passenger numbers within segment Source: Zurich Airport, data warehouse, Full Year Financial Results

12 4. Non-Aviation Full Year Financial Results

13 Non-Aviation Segment Revenue Breakdown Commercial segment grows disproportionately, as expected Timely introduction of Arrival and Walk Through Duty Free New F&B brands and concepts show positive results Solid rents and leases development Strong Swiss franc remains challenging in million CHF Jan-Dec 2011 Jan-Dec 2010 Delta Retail and tax & duty free % Food & beverage % Others % Commercial % Rents and leases % Utilities % Others % Real estate % Parking % Others % Total % Ø Commercial income* per departing pax (CHF) % * Commercial income includes retail & tax/duty free and food & beverages Full Year Financial Results

14 Commercial: Gross Income Shop-Operators Full Year Financial Results

15 Real Estate: Development of Revenue Low vacancy rate underlines attractiveness of Zurich Airport New substantial anchor tenants (SBB, Meteo Switzerland) New freight dispatch hall fully let in million CHF 140 Real Estate Revenues Ø vacancy in % (31.12.) % % 3.3% % % 3.3% % % 3.2% 2.3% others 25.2 utilities 88.9 rents & leases in % 8% 7% 6% 5% 4% 3% 2% % 1% % Full Year Financial Results

16 5. Financial Key Figures Full Year Financial Results

17 Operating Expenses Total operating expenses increased disproportionately Higher personnel costs mainly the result of nominal salary increases Number of FTE s increased by 2.2% as a result of new infrastructure and higher traffic volumes Security costs increased disproportionately to traffic Jan-Dec Jan-Dec in million CHF Delta Personnel % Police and security % Energy and waste % Maintenance and material % Other operating costs % SG&A % Extraordinary results % Total operating expenses % Synergy of the new Security Check Building (in operation since December 1, 2011) shall be seen only as of 2012 Reduced maintenance & material costs as a result of a mild winter Increase of SG&A due to one-off costs, among others of the Zürich 2010 project Capitalised expenditures newly shown as cost reduction; prior year restated accordingly Full Year Financial Results

18 Net Result Operating leverage visible on EBITDA, EBIT and net profit Higher depreciation due to newly capitalised infrastructure and expected reduced useful lifetime of few assets in million CHF Jan-Dec Jan-Dec Delta EBITDA % EBITDA margin 53.6% 51.3% Depreciation and amortisation % EBIT % EBIT margin 31.3% 28.9% Finance result (net) % Associated companies n/a Taxes % Net profit % Net cost of capital increased as a result of higher expenses (non-cash) for unwinding provision for sound insulation and resident protection as well as formal expropriation payments Cash interest costs reduced by approx. CHF 3 million as a result of lower average interest rates on financial debt Taxes include a one time positive effect of CHF 2.5 million as a result of offsetting tax losses. Expected tax rate of 20.5 percent remains unchanged Full Year Financial Results

19 Capital Expenditures 2011 Top 10 in million CHF Expenditures 2011 Expenditures total 1 Project Zürich ca Upgrade Terminal ca Maintenance operations to preserve the value of engineering structures 16.0 recurrent 4 Maintenance operations to preserve the value of buildings 13.0 recurrent 5 Expansion Parking ca Freight Dispatch Hall 9.7 ca Arrival Duty Free 8.9 ca South wing of Terminal ca Maintenance operation to preserve the value of assets 6.9 recurrent 10 Refurbishment Parking ca. 24 Others Total capital expenditures Full Year Financial Results

20 Other Key Figures Strong financial key figures Interest bearing liabilities increased mainly as a result of currency movements Big ROCE-step One-time impact on operating cash flow in 2010 due to change of payment terms in million CHF incl. noise excl. noise Interest-bearing liabilities/ebitda 1.69x 1.73x 2.41x 2.37x Cash flow from operating activities/interest-bearing liabilities 53.6% 57.0% 37.6% 41.9% Interest-bearing liabilities ' Gearing 45.4% 44.9% 65.4% 63.3% ROCE 7.9% 7.0% 7.2% 6.8% Capital efficiency n/a n/a Return on Equity 9.8% 8.4% 9.5% 8.3% Equity Ratio 47.2% 47.9% 49.9% 50.6% Cash flow operating activities whereof CAPEX (from cashflow statement) Free cash flow* * Cash flow from operating activities minus Capital Expenditure Full Year Financial Results

21 6. Other Key Topics Full Year Financial Results

22 Upgrade Terminal 2 Refurbishment of the fivestorey building for the next 30 years of operation Baggage claim hall already completely renovated Next major step: Modifications at Check-in 2 Building work has to be done during ongoing operations Full Year Financial Results

23 Update on The Circle Permits for Parking lots already approved Building permit granted in March 2012 Agreement with hotel operator Hyatt (total surface of m 2 ) Hyatt Regency: 250 rooms/hyatt Place: 300 rooms Conference facilities: people incl. break out rooms, exhibition space and lobby Financial advisor appointed/marketing and due diligence phase expected to start in 2012/financial close currently expected first half 2013 Assumption financial structure: new company to be established, Flughafen Zürich AG with a majority equity stake, at least during construction phase Triggers for project approval by Board of Directors: Achievement of expected hurdle rate Equity and debt funding in place Pre-letting quote reached Full Year Financial Results

24 Economic Regulations Three steps to set charges in draft regulation: 1. Intention to reach a mutual agreement between airport operator and user 2. If no agreement is possible, the airport has the option to apply to set charges based on a benchmark study 3. If neither step 1 or 2 is possible, a fall back regulation will be adopted The fall back regulation is designed as cost plus regulation based on a hybrid dual till system Consultation period on the draft regulation ended on December 9, 2011 Flughafen Zürich AG commented on the draft regulation in detail. FOCA processes all comments w/o our further involvement Federal government expected to decide soon on final regulation. Transition period expected up to end of Full Year Financial Results

25 Politics and Regulations Sectoral Aviation Infrastructure Plan (SAIP): Federal government expected to take a decision in 2012 Rejection of cantonal initiative on November 27, 2011: A strong sign to Germany that Switzerland is willing to take its share of the noise German and Swiss Ministry of Transport have signed a declaration of intent in order to reach a sustainable solution on the northern approach over German territory (DVO) Recapitalisation of BVK (Employee Pension Fund of the Canton of Zurich) still under discussion Full Year Financial Results

26 News on International Business Development Current Assets: India (Bangalore) Latin-Americas (Chile, Colombia, Curaçao, Honduras) Bogotá Airport, Colombia Reviews in 2011: Crete, Greece Zagreb, Croatia Bengaluru International Airport / Sao Paulo and Brasilia, Brazil Expected project reviews in 2012: Abu Dhabi San Juan, Puerto Rico Second set of concessions in Brazil Santiago, Chile Navi Mumbai India Bangalore Int. Airport, India Natal Site / Brazil Full Year Financial Results

27 Noise Costs: Formal Expropriation Payments Decision of Swiss Federal Court on minor value of yield properties: basis to settle open claims in certain regions Most-likely estimate of costs remains at CHF 740 million Current expectations of payments to be completed: Formal Expropriation: end of 2018 Sound insulation: end of 2020 Shift in Split of old and new noise liabilities Increase in provision and intangible asset of CHF 27 million Share of noise revenue 76% (instead of 72%) as of January 1, 2012 CHF 5.- noise surcharge currently remains unchanged Full Year Financial Results

28 7. Outlook Full Year Financial Results

29 Outlook 2012: Traffic in millions 2012 Jan-Feb 2011 Jan-Feb Delta Local passengers % Transfer passengers % Transfer share 36.5% 35.7% Total passengers % Movements (in thousand) % whereof Line & Charter movements % Cargo (in thousand tons) % Full Year Financial Results

30 Outlook 2012: Commercial Activities 2012 Jan-Feb 2011 Jan-Feb Delta Airside (change versus prev. year) 11.4% -6.7% Landside (change versus prev. year) -1.1% 2.6% Total turnover, m CHF % Airside (change versus prev. year) 8.3% -11.2% Landside (change versus prev. year) -3.8% -2.4% Commercial turnover/dep. pax, CHF % Full Year Financial Results

31 Guidance Full Year 2012 Passenger volume increase by approx. 2% Total revenues to increase by 4 to 5% Aviation revenue to grow slightly above passenger volume as a result of revised noise split between FZAG and Canton ZH Non-Aviation revenue to grow over-proportionately, mainly attributable to commercial income but also fixed rent income Opex to increase under-proportionately by 3 to 4% Increase of depreciation to approx. CHF 215 million Net result incl. noise up by 5 to 10% Net result excl. noise up by approx. 5% Capex CHF million Full Year Financial Results

32 Core Capex Projects going forward Focus (high visibility re: cost/timeframe): Maintenance capex: Key projects: Focus (medium visibility re: cost/timeframe): Maintenance capex: Key projects: - CHF million p.a. required - Terminal 2 total refurbishment - Parking extension - Renovation RWY 14/32 (preponed for operational reason) - Apron/stands development (operational/efficiency reason) - Upgrade curb side area - CHF million p.a. required - Renovation RWY 10/28 (preponed for operational reason) - Apron/stands development (operational/efficiency reason) - Cargo extension (capacity driven) The Circle - condition to clearly defined criteria All capex plans are condition to: - regulated assets to be financially feasible (Ec. Regulation) - positive economical and market environment - retention of competitive dividend policy Full Year Financial Results

33 8. Your Questions Full Year Financial Results

34 Guidance on mid term Capex Plan CAPEX (Mio CHF) Terminal Area Zürich Zone Terminal Zone Terminal 1 and Baggage Sorting System Parking Parking (replacement and additional capacity) Parking refurbishments/ Access roads to Parking and Airport Cargo infrastructure Freight infrastructure Runways, Stands & Apron Additional Stands Maintenance & Renovation RWY 10/ Maintenance & Renovation RWY 14/ Other Investments Constructional facility maintenance Airfield maintenance Surface/Water treatment facilities Other investments Total CAPEX excluding The Circle Full Year Financial Results

35 Repayment Schedule (as per ) Major repayments: Partly repayments CBL (2011 & 2012) Partly repayments ~ US PP ( ) 2016 Bond 2015 CHF 225m (2014) new Bond CHF 250m (2017) Repayment Japanese PP (2024) USPP CBL Bonds JPP Full Year Financial Results

36 Debt Maturity Structure (Financial Liabilities) % 34.4% 57.4% % 47.2% 43.8% % 44.2% 40.2% % 38.1% 47.6% % 48.0% 48.4% % 38.8% 52.5% % 23.5% 68.7% % 26.5% 66.5% % 25.1% 68.4% % 54.4% 28.2% 0% 20% 40% 60% 80% 100% within 1 year between 1 and 5 years longer than 5 years Full Year Financial Results

37 Hub Carrier Dominance at European Airports (seats offered) MUC FRA hubcarrier other alliance members ZRH CDG VIE AMS BRU CPH LHR MAD 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Source: Sabre ADI, Januar Dezember Full Year Financial Results

38 Customer segments ZRH 2011 Star Alliance Low Cost Carrier OneWorld Sky Team thereof SWISS: 55.6% thereof SWISS: 56.2% davon SWISS: 81.3% thereof SWISS: 58.2% thereof SWISS: 55.1% thereof SWISS: 53.6% 4.2% 4.3% 4.8% 4.9% 5.7% 3.9% 4.0% 3.9% 5.0% 5.2% 11.2% 10.8% 10.2% 10.2% 8.7% 68.7% 68.8% 70.3% 68.4% 66.8% FY 2011 FY 2010 FY 2009 FY 2008 FY 2007 Charter 1.8% 1.5% 2.7% 3.7% 5.5% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% Full Year Financial Results

39 Star Alliance Hub vs % Impact of volcanic erruption in Island in April % 10% FRA MUC VIE 5% BRU CPH ZRH 0% -5% -10% Impact of volcanic erruption in Island in April 2010 BRU CPH FRA MUC VIE ZRH Full Year Financial Results

40 ZRH Passenger Market Share & Growth (YTD 2011) North America Share: 7.8% (PY: 7.8%) Change in Pax: +6.5% Europe Share: 78.4% (PY: 77.3%) Change in Pax: +7.9% Asia Share: 9.8% (PY: 10.2%) Change in Pax: +2.7% Latin America Africa Share: 0.8% (PY: 0.9%) Change in Pax: -4.0% Share: 3.1% (PY: 3.8%) Change in Pax: -12.3% Full Year Financial Results

41 Outlook Traffic: Changes Summer Timetable 2012 Additions/reductions summer timetable 2012 Beijing, (new SWISS destination) 5x weekly (as of ), daily (as of ) Bucharest, from daily to double daily (Wetlease Helvetic) Chicago, from daily to 11x weekly (as of ) Newark, from 6x weekly to daily (A instead of PrivatAir B ) Prague, from 3x to 4x daily (Wetlease Helvetic) Douala /Yaounde, ceased service (4x weekly) Frequency additions / reductions: Air Baltic Bulgaria Air Sun Express Sun Express Turkish Airlines Royal Jordanian SAS Riga, from 6x weekly to daily Sofia, 4x weekly increased to 5x weekly Antalya, from 7x to 10x weekly Izmir, from 2x to 3x weekly Istanbul, from 17x to 21x weekly Amman, from 4x to 3x weekly Copenhagen, from 3x to 2x daily Full Year Financial Results

42 Outlook Traffic: Changes Summer Timetable 2012 New services / cancellations: Darwin Genoa, 11x weekly (new destination) Edelweiss Capetown, up to 2x weekly; Alicante, up to 2x weekly; Funchal, 1x weekly Edelweiss Tampa 2x weekly (as of May 2012), Tokyo, 2x weekly (as of May 2012) Helvetic Usedom - Heringsdorf, 1x weekly OLT Dresden, 3x daily on weekdays and 1x daily on weekends WOW Air Reykjavik, 2x weekly as of June 2012 (new airline) Blue1 Easyjet Malev Sun Express Helsinki, ceased service (13x weekly) Manchester, ceased service (6x daily) Budapest, ceased service (airline in bankruptcy) Istanbul, ceased service (2x weekly) Full Year Financial Results