Retail success lifts ACSA revenues

Nicole Mezzasalma

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Nearly half of South African authority’s profits come from non-aeronautical sources including retail

Airports Company South Africa (ACSA) has posted positive results for the year ended March 31 2007, when revenue increased by 18% to R2.56bn ($342.9m). Non-aeronautical revenue, which includes retail, rose to R1.19bn ($158.8m), up from R984m ($131.3m) in 2006, and now accounts for over 46% of ACSA’s total earnings. Retail revenues, which include duty-free, core retail, advertising and car hire, contributed 68% of the group’s non-aeronautical revenue.

ACSA executive director finance Brooks Mparutsa said: “Non-aeronautical revenues generated by the commercial department contributed 80% of the group’s operating profit. This further highlights the importance of ACSA’s commercial activities in a regulatory environment where the airports are regulated in a single-till price cap system [where commercial as well as aeronautical revenues received by an airport are taken into account in assessing the appropriate maximum level of airport charges].”
 
Group profit before taxation increased by 23% to R1.14m ($152,178), and the company’s EBIDTA increased by 20.6% to R1.64m ($219,272). Over the past six years, ACSA’s EBIDTA margin improved from 55% to an all-time high of 64% in 2007. The main driver of the group’s growth, according to the firm, was an increase in passengers at ACSA airports due to an “exceptionally strong performance in the domestic market, on the back of a positive economic climate”.