ADP Sees "Mild" 2009 Profit Growth, Lower Traffic
Aeroports de Paris forecast "mild" revenue and core profit growth in 2009 and trimmed its medium-term outlook as it posted annual results above market expectations on Thursday.
The operator of Charles de Gaulle and Orly airports also forecast a drop of up to 4.5 percent in 2009 passenger traffic, a day after its main airline customer Air France-KLM announced a further cut in summer seat capacity as the economic downturn slashes demand for air travel.
The group said earnings before interest, tax, depreciation and amortization (EBITDA) -- its most widely monitored profit figure -- rose 12 percent to EUR848 million euros (USD$1.09 billion) in 2008.
Earnings before interest and tax (EBIT) or operating profit rose 12.6 percent to EUR501.1 million on already reported sales of EUR2.527 billion, up 10.2 percent.
The profit surge came as spending at its recently expanded terminal stores raced ahead of 2008 passenger traffic growth of just 0.8 percent, which ADP said contrasted positively with traffic falls at most other European airports.
The state-controlled group said restated net income rose 12.6 percent to EUR271.2 million and recommended a dividend of 1.38 euros per share, down from 1.63 euros the previous year -- which was boosted by proceeds from the sale of a stake in Beijing airport.
MORE SELECTIVE
ADP, which last year opened new terminal areas dotted with shops run by leading European fashion designers, said it would cut EUR42 million of costs in 2009 and take a "more selective approach" to investments.
"Assuming passenger traffic were to decline between 2.5 percent and 4.5 percent in 2009 before recovering slightly in 2010, our outlook would be (for) mild revenue and EBITDA growth in 2009," it said in a statement.
It said using the same assumptions it also expected EBITDA growth to range between 50 and 60 percent between 2005 and 2010 compared with an earlier forecast of 60 percent.
"The problem for us is to know how long the crisis will last. We are in the most total uncertainty about that," Chairman and CEO Pierre Graff said.
ADP was the second major hub operator in a week to report buoyant 2008 figures while preparing for the economic chill.
Frankfurt's Fraport last week posted fourth-quarter EBITDA up 20 percent at EUR108.2 million.
But it expected passenger numbers and cargo volumes to keep shrinking in coming months as the global economic crisis stunts business travel and consumer spending.
February passenger traffic at the Lufthansa hub fell 4.8 percent, with a 25.6 percent drop in cargo volumes.
In Britain, BAA's UK airports handled 12.5 percent fewer passengers in February, partly due to bad weather. The underlying fall was 6.4 percent, Spanish owner Ferrovial said.
ADP announces February traffic next week. Its shares closed on Wednesday at 40 euros, down 17 percent so far this year.
