Airport Authority sets new profit record of HK$6.5 billion for 2013/2014 declared final dividend of HK$5.3 billion to HKSAR Government

Airport Authority Hong Kong (AA) reported another strong year in fiscal 2013/2014, including record-breaking traffic numbers and robust financial performance. For the 12 months ended 31 March 2014, revenue and profit attributable to the equity shareholder surged 12.8% and 14.9% respectively, to HK$14,810 million and HK$6,454 million. Earnings before interest, taxes, depreciation and amortisation (EBITDA) also increased 12.3% year on year to HK$9,938 million.

The AA declared a final dividend of HK$5,300 million to the Hong Kong SAR Government. Including this, the AA will have returned the Government a total of HK$35,680 million in dividends and repaid capital since fiscal 2003/2004.

The robust top- and bottom-line increases were attributed mainly to growing traffic, higher retail concessions revenue and effective cost controls. During the year, passenger volume and aircraft movements set new records of 60.7 million and 377,476 movements respectively, representing year-on-year growth of 6.1% and 6.3%. Cargo throughput rose 3.4% to 4.2 million tonnes, sustaining the airport’s status as the world’s busiest cargo airport for the fourth consecutive year.

Cross-boundary passenger trips between Hong Kong International Airport (HKIA) and destinations across the Pearl River Delta also saw steady growth, with approximately 2.7 million passengers travelling via SkyPier and two million passengers using the limousine and coach services. These figures represented gains of 1.7% and 1% respectively compared to the last fiscal year.

Stanley Hui Hon-chung, Chief Executive Officer of the AA, said, “Air traffic at HKIA is growing much faster than the projections made in HKIA Master Plan 2030. We expect that the global economic recovery and robust regional growth will continue to drive traffic demand at a moderate rate. As a result, the two-runway system at HKIA will likely reach its capacity in a few years’ time.

“To increase ground handling capacity for the immediate and medium terms, we have been pushing ahead with our Midfield development and west apron expansion projects. An investment of more than HK$12 billion, these two projects will add a total of 48 parking stands and allow HKIA to serve an additional 10 million passengers a year,” added Mr Hui.

Under the apron expansion programme, 20 new parking stands have entered service, and another eight will become operational by the end of 2014 to meet immediate needs. The five-level Midfield Concourse with 20 parking stands is scheduled for commissioning by end-2015. Other initiatives to maintain operational and service excellence under increasing traffic pressures are also underway; these include the resurfacing of taxiways and runways, as well as enhancement of fixed ground power and pre-conditioned air systems.

Commenting on the AA’s financial position, William Lo Chi-chung, Executive Director, Finance, said, “We are very happy with our record-breaking performance for fiscal 2013/2014. This year we will face a number of challenges, like slower retail sales due to the high revenue base we set, the sluggish local retail market, increased operating expenses to maintain our excellent service levels, and ongoing investments in much-needed capacity enhancements. However, we will employ prudent financial management as always to ensure that HKIA has a successful 2014/2015, and continues to generate business and opportunities for Hong Kong.”

To capitalise on business opportunities arising from developments such as the Hong Kong-Zhuhai-Macao Bridge and the Tuen Mun-Chek Lap Kok Link – all of which will commence operations in the next few years – the AA is mapping out development plans for the North Commercial District (NCD). The first phase of the NCD development will be a hotel with more than 1,000 rooms, and a master plan for the entire district is expected to be completed this year.

Meanwhile, the AA is continuing its planning work to expand HKIA into a three-runway system (3RS), including the Environmental Impact Assessment (EIA), scheme design, cost updates and funding options as well as ongoing communications with the wider public. The EIA report for the 3RS project is now available for public inspection until 19 July.

Mr Hui said, “Developing the 3RS as soon as practicable is essential not only for the sustainable development of HKIA, but also the continuous growth, prosperity and long-term competitiveness of Hong Kong. We hope that the EIA process can be completed in 2014, after which we will proceed to seek the other required Government, statutory and Legislative Council approvals. Our aim is to start construction in 2016 and for the 3RS to become operational in 2023.”

Download the Annual Report 2013/14:
http://www.hongkongairport.com/eng/media/publication/annual-reports-2013-14.html