Dublin and Cork Airports’ daa to pay €31 Million dividend

The Board of daa (the operator of Cork and Dublin airports, daa International and ARI, the Group’s retailing subsidiary) have published their 2023 Annual Report and Accounts. The report recommends a €31 million shareholder dividend to the State.

Due to the long-term impacts of the COVID pandemic on the aviation sector, this is the first dividend since 2019. In addition, daa paid €153 million in various taxes to the State last year. The period’s turnover was €1018 million in the year, representing a 35% increase on 2022 and the first time in daa’s history that it has earned over €1 billion in revenue.

This increase in revenue has resulted in the daa Group recording a profit after tax and exceptional items of €176 million for 2023. Even though it is state-owned, daa received no funding from the Exchequer and operates as a fully standalone commercial business.

daa’s Chief Financial Officer, Peter Dunne, commented: “Whilst our business performed strongly in the period and had cash balances of €805 million at the end of the year, the Group also had debt totalling €1.6 billion which is over twice the pre-pandemic levels with the majority of it falling due between 2028 and 2032. In addition to refinancing the existing facilities over the coming years, additional debt funding will be required to support the significant investment in sustainable infrastructure needed to provide passenger capacity at Ireland’s two busiest airports in Dublin and Cork. Notwithstanding having some of the lowest airport charges in Europe, our strong commercial performance in this inflationary environment and disciplined approach to capital has resulted in the daa Group maintaining its investment grade status of A-/A-2 with S&P Global Ratings.”

Following a recovery in the Group’s financial position post COVID, daa Chair, Basil Geoghegan, said: “daa’s focus is to continue investing in connectivity and services for the benefit of passengers and Ireland Inc., but that requires delivering returns on capital consistent with other European airports. Our aim is to place daa on a more sustainable and robust financial footing to support our planned €2bn capital investment required to meet Ireland’s future connectivity requirements. Progress to date reflects revenue growth and strong improvements in efficiency and innovation, but achieving parity of returns with competing international airports remains challenging given our airport charges are now a fraction of the levels of other capital city airports in Europe. I want to express my thanks and appreciation and that of the Board to all our employees across the Group for their immense hard work and continued dedication, commitment and professionalism to ensure better and more resilient airport and retailing experiences for our passengers in Ireland and in 15 countries across the world in 2023.”

Dublin and Cork airports, Ireland’s two busiest international gateways, welcomed 36.3 million passengers in total in 2023. A total of 31.9 million passengers passed through the two terminals at Dublin Airport in 2023, in compliance with the 32 million terminal cap as adjusted for transfer and transit passengers. Dublin Airport ensured a better experience for passengers from May onwards, with 97% of passengers passing through security screening in less than 20 minutes, exceeding daa’s own target of 90%. Passenger satisfaction scores at Dublin Airport improved 37% in 2023 over 2022.

Kenny Jacobs, daa’s CEO said: “2023 was a very solid year for daa, as our teams delivered a much-improved airport experience for our passengers. We also delivered for our business partners at all the airports we operate at home and abroad. I am proud of the progress that I see across the daa Group. As a team, we are moving quicker, getting the basics right for passengers and we are bringing more innovation on airports, commercial (lounges, Food & Beverage, retail, fast track, Airport Club, drop & go parking) digital and sustainability. We are concerned about cost headwinds in Ireland while the regulated charges at Dublin are less than half the average of EU capitals and we are not able to respond to the airline demand to add more routes because of the cap at Dublin Airport. Some essential connectivity will be lost as airlines are already prioritising growth at hubs outside Ireland.”

On the current stalled growth being experienced at Dublin Airport due to a terminals cap, Kenny Jacobs issued this comment: “It is a sign of Ireland’s success that Dublin Airport catered for almost 32 million terminal passengers in 2023 and that there is significant demand from airlines and passengers for additional connectivity. daa has sought planning permission to cater for up to 40 million passengers per year so Dublin Airport can continue to be an engine for Ireland’s growth, bringing jobs, investment and tourism. We are a small, open, island economy and stalled growth at our national airport sends a negative signal about investment in Ireland. While we await the outcome of the planning process, daa is making every effort to restrict growth to stay within the cap and continues to work with the IAA as slots regulator and our airline customers with a view to managing capacity at Dublin Airport.”

Cork Airport enjoyed the busiest year in its 62-year history for international passenger traffic, with 2.8 million passengers travelling through in 2023, a 25% increase on 2022 levels (2.24 million). daa has invested c. €40 million in Cork Airport since 2018 on the reconstruction of the main runway, a new hold baggage screening system and the opening of a new electrical substation to future-proof the airport. daa will continue to invest further at Cork Airport in 2024, with C3 security screening equipment on a new mezzanine floor to be constructed to improve the overall passenger experience.

ARI, daa’s global airport retail business achieved significant growth last year, with each of the 27 airports in which it operates demonstrating a strong performance compared to the previous year and many achieving historically high sales turnover underpinned by strong passenger volumes and increases in passengers spend. ARI’s joint venture with ANA, at Portugal Duty Free exceeded expectations with the business trading ahead of plan, with an ongoing focus on delivering an extensive capital refurbishment programme to improve the retail experience in our airport shops.

daa International facilitated the global connectivity travel needs of 65 million passengers in 2023 through the three airports in Saudi Arabia Jeddah, Riyadh and Red Sea where we are providing airport management, operations and maintenance consultancy services to their client. Daa International is contracted to support, manage and advise not only on operations but also aviation business development, non-aeronautical commercial revenue and facilities management at locations in the Middle East and across the globe.