Fraport posts 2020 loss of US$821.3 million, sales off 54.7pc

GERMANY's Fraport airport company posted a 2020 net loss of EUR690

17 March 2021 - 19:00
GERMANY's Fraport airport company posted a 2020 net loss of EUR690.4 million (US$821.3 million) drawn on revenues of EUR1.68 billion, down 54.7 per cent.

This was the first profit decline in 20 years entirely attributed to the fall in passenger traffic caused by the Covid crisis, which not only hit Frankfurt Airport but all company airports worldwide.

' Aviation has been hit hard by the Covid-19 pandemic,' said Fraport chairman Stefan Schulte. 'Nevertheless, we are now seeing the light at the end of the tunnel. The rollout of vaccination programmes and greater availability of testing options provide the prerequisites for air traffic to rebound ' starting this summer at the latest.

'People want to travel again, while airlines are ready to ramp up their capacities. At the same time, we have realigned our company to become leaner and more agile,' said Dr Schulte.

'As the operator of the Frankfurt Airport global hub and thanks to our group airports worldwide, we are well positioned to fully benefit from the air travel relaunch, while our long-term growth perspectives remain intact,' he said.

In 2020, passenger traffic at Frankfurt Airport (FRA) dropped by 73.4 per cent year-on-year to 18.8 million travellers. Passenger numbers were also markedly down at Fraport's Group airports worldwide, with declines ranging from minus 34 per cent at Xian. .

But Fraport reduced operating expenses by nearly a third, after adjusting for the additional expenses for personnel-reduction measures. This enabled Fraport to achieve a slightly positive EBITDA of EUR48.4 million in fiscal 2020, down 95.9 per cent year-on-year.

When taking into account the extra expenses of EUR299 million for personnel-reduction measures, Group EBITDA in 2020 fell to minus EUR250.6 million (2019: EUR1.18 billion). Group EBIT slipped to minus EUR708.1 million (2019: EUR705.0 million), while the group net profit came to EUR690.3 million.

Fraport downsized or cancelled a number of investments, particularly at its Frankfurt home base ' thus reducing related capital expenditure by EUR1 billion over the medium and long-term.

Fraport is continuing construction of the new Terminal 3 at Frankfurt Airport to meet the anticipated long-term demand. However, the time frame for building the new terminal has been extended. Terminal 3 ' comprising the main building with Piers G, H and J ' is now scheduled to become operational in 2026.

Fraport will be cutting about 4,000 jobs mainly by the end of 2021 ' thus reducing personnel costs by up to EUR250 million compared to 2019.

About 2,200 of planned staff reductions were already realized during 2020. In addition, some 1,600 employees have agreed to leave the company under a redundancy programme consisting of severance packages, early-retirement schemes and other measures.

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