Acsa posts R1.9bn profit

Johannesburg - The Airports Company of South Africa (Acsa) has seen a growth in its revenue and asset base over the past year, said chief financial officer, Maureen Manyama.

Manyama was speaking at the State-owned Enterprise’s (SOE) financial results announcement for the year ended 31 March 2016, in Parktown, Johannesburg on Friday.

Acsa reported a profit of R1.9bn.

“Depending on how you look at it, you can round up to R2bn,”quipped Manyama.

The state-owned enterprise's earnings before interest, taxes, depreciation and amortisation (Ebitda) was up 7.1% to R5.2bn.

Revenue increased 6.8% to R8.3bn as a result of the introduction of new routes, growing passenger numbers from Europe and Asia and the performance of its non-aeronautical operations.  

The dividend of R343m has not yet been paid out to shareholders, said Manyama.

“Revenue is split 63% for aeronautical activities and 37% for non-aeronautical activities,” she explained.

Aeronautical revenue growth to R5.2bn was attributed to the growth in volumes, as tariffs were consistent with the previous year’s levels. Non-aeronautical revenue is purely commercial and came to R3.1bn.

The revenue from retail, which was at R1.1bn was driven by increased volumes in the passenger base, and the depreciation of rand against major currencies. Other sources include property rental, advertising, car hire, parking and hotel operations, she explained.

“The medium to long term goal is to rely less on aeronautical revenues because it is regulated,” said Manyama.

Footprint expansion comes at a cost

Acsa’s total expenses came down 1% to R4.4bn. However, total equity losses came to R690m, up from R155m reported in 2015. About R622m of the costs is attributed to the company’s share in its Brazilian concessionaire.

“The economic climate in Brazil is not conducive for business,” said Manyama.

The company’s share in losses from Mumbai International Airport came to R85m. This is due to higher finance costs on borrowings and the higher depreciation of a new terminal building, being terminal two, she explained.

Value created by the business was down to R6.2bn from R6.4bn reported in the previous year mainly due to losses in Mumbai and Brazil.

The Brazil concession is 20 years long, and Acsa is in its fourth year. It has a 30-year concession with Mumbai, which has the option to be extended for another 30 years, explained CEO Bongani Maseko.

Maseko added that besides developing airports in South Africa, the SOE wanted to develop airports outside its borders and identified Ghana as a hub in West Africa.

Acsa’s capital expenditure was up to R1.3bn from the 2015 level of R830m.

“This is in line with the plan of the organisation,” said Manyama.

The organisation has developed a capital expenditure programme of R4.9bn from 2017 to 2019. A “major part” of the funding is to be generated internally and R800m of the funding will be sourced through debt, she explained.

A deleveraging strategy has helped the organisation pay off its debt.

“The trend in borrowings has gone down, and similarly in interests on costs,” she said.

Debt for organisation is at R9.8bn and R2.9bn is due in the next 3 years, from 2017 to 2019. In the past five years, Acsa paid off R7bn of its borrowings.

Ratings agency Moody’s has affirmed the SOE’s status at Baa2, with a negative outlook.

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