High Lufthansa Airfares is why Frankfurt Airport did not reach 2019 profits

FRAPORT operates airports across the globe and this may be the message when combining numbers by all airports operated by Germany-based FRAPORT airport operators.

When it comes to Frankfurt International Airport in Germany the results are lower than the 2019 statistics with 86% of the pre-Covid level.

According to FRAPORT CEO Dr. Stefan Schulte, the home base Frankfurt Airport performed well, with passenger volumes in the third quarter of 2023 reaching 86 percent of 2019 levels.

However, 86% of the level before COVID is no comparison to other FRAPORT airports outside Germany and the global trend in aviation.

The reason is expensive Lufthansa tickets due to high demand and not enough planes operating. Lufthansa is taking the profit for this situation all the way to the bank. The shortage of pilots also plays into the fact of expensive air tickets, and expanding routes.

For FRAPORT airports combined during the first nine months of the 2023 fiscal year (corresponding to the calendar year in Germany), the Fraport Group delivered a strong performance with key operating figures exceeding 2019 levels.

The Group’s result (net profit) reached €357.0 million in the first nine months, buoyed by traffic growth across the Group’s airports. This positive performance was driven, in particular, by a strong third quarter – with revenue, EBITDA (earnings before interest, taxes, depreciation, and amortization) and net profit achieving new records.

In view of this development, Fraport confirms its outlook for the full 2023 fiscal year, expecting to reach the upper range of the given forecasts.

Fraport CEO Dr. Stefan Schulte said:

„We had a strong third quarter. As an important milestone, our actively managed Group airports outside Germany saw combined passenger traffic fully recover to 2019 levels during this period. The 14 Greek gateways and Antalya Airport were driving this trend by setting new all-time passenger records.

FRA is thus overcoming the crisis faster than other major German airports.

Backed by the ongoing traffic recovery, our financial performance also significantly improved. During the third quarter, Fraport’s revenue, EBITDA and net profit achieved new all-time highs. This is an important factor as it will help us continue to gradually reduce the debt incurred during the pandemic.”

Third quarter of 2023: key figures reach historic highs

Supported by the rebound in passenger traffic during the summer months, Group revenue grew by 17.0 percent to €1,083.3 million in the third quarter (Q3) of 2023, from €925.6 million in Q3/2022 .

The third-quarter Group revenue as per IFRIC 12 exceeded the respective Group revenue from pre-crisis 2019 by 11.4 percent (Q3/2019: €972.8 million). Group EBITDA improved to €478.1 million in the third quarter (Q3/2022: €420.3 million; Q3/2019: €436.7 million). The Group result or net profit jumped by €120.8 million to a new record high of €272.0 million (Q3/2022: €151.2 million; Q3/2019: €248.6 million).

First nine months of 2023: key operating indicators exceed 2019 levels

In the first nine months (9M) of fiscal 2023, Group revenue as per IFRIC 12 rose by €494.5 million to €2,631.9 million (9M/2022: €2,137.4 million; 9M/2019: €2,486.7 million). The 9M-revenue for the first time includes proceeds from aviation security fees, totaling €167.0 million.

These were levied by Fraport after assuming responsibility for passenger security screening at Frankfurt Airport with the start of 2023. Group EBITDA improved by 15.8 percent year-on-year to €959.5 million in the first nine months (9M/2022: €828.6 million; 9M/2019: €948.2 million). The Group result (net profit) improved noticeably by €258.9 million to €357.0 million. Last year’s nine-month Group result of €98.1 million was negatively impacted by a full €163.3 million write-off of loan receivables from Thalita Trading Ltd. in connection with the investment at Pulkovo Airport (LED) in St. Petersburg.

Passenger demand remains high

In the first nine months of 2023, passenger traffic at Frankfurt Airport (FRA) increased by 23.9 percent year-on-year to around 44.5 million travelers. Demand was particularly high for traditional holiday destinations within Europe and long-haul flights. High-frequency traffic to/from North America continued to rebound to almost pre-pandemic levels in the first nine months.

SOURCE: High Lufthansa Airfares is why Frankfurt Airport did not reach 2019 profits