Financial year 2022: return to profit
Flughafen Zürich AG posts a profit of CHF 207.0 million for 2022. International air travel recovered steadily in the course of the year. The real estate business including the Circle and the recovery of the commercial centers made a major contribution to this positive result. The return to profit means that it is now possible to pay the shareholders a dividend again. Some management changes are imminent on both the Management Board and the Board of Directors.
After two years with a loss, we can now report a clear profit again for 2022. International air travel is recovering steadily, and the rapid uptick in operations since early summer has been successful, thanks to the great commitment of all involved. Our commercial revenue also improved, and real estate revenue is posting a new peak.
Traffic trend
In the first half of 2022, passenger volumes increased in just a few months from 15,000 to peaks of around 90,000 passengers per day. In 2022, 22.6 million passengers flew via Zurich Airport. Compared with the previous year, this is more than a twofold increase. Passenger volumes amounted to 72% of the 2019 number. The number of flight movements in 2022 came to 216,585, which is an increase of 63% compared with 2021 and 79% of the 2019 volume. A total of 422,153 tonnes of freight were handled at Zurich Airport in 2022. Compared with the previous year this is an increase of 7%, while the freight volume amounted to 93% of the 2019 figure.
Finance result
With the return to the profit zone, Flughafen Zürich AG reached a major milestone on the way back to its previous financial strength. The company’s indebtedness, which had risen as a result of the pandemic, can now be gradually reduced, and larger projects can now be relaunched or started.
Thanks to the encouraging trend in traffic volumes and increased footfall in our commercial centers, revenue exceeded the one billion Swiss franc mark in the reporting year. viation revenue more than doubled from CHF 240.6 million to CHF 491.1 million and amounted to 74% of the 2019 figure. Non-aviation revenue increased by 21% to CHF 532.4 million, roughly 97% of the figure for 2019. Ongoing rigorous cost discipline measures counteracted inflation-related cost increases and rising energy prices. Total operating expenses increased 23% year on year to CHF 467.9 million. The adjusted cost basis was still 7% lower overall than in 2019. Earnings before interest, tax, depreciation and amortisation (EBITDA) increased by CHF 256.3 million year on year to CHF 555.6 million (+86%). Compared with 2019, EBITDA stood at 87%.
The consolidated result for the past year increased markedly to a profit of CHF 207.0 million (2021: loss of CHF 10.1 million). Factoring out one-off effects, the consolidated result would have stood at CHF 183.0 million. In the reporting year, Flughafen Zürich AG invested CHF 235.3 million (2021: CHF 206.3 million), of which CHF 208.3 million (2021: CHF 169.5 million) at its Zurich site.
Real estate business and commercial development
The real estate business proved to be a stable revenue pillar at the Zurich site. Since its opening in November 2020, the Circle has had a significant effect on added value at Zurich Airport. There are now 49 companies employing over 5,000 people at the Circle. The two Hyatt hotels and the Conference Center in the Circle are performing well. The Circle is also proving successful as a meeting place. In particular, the Zauberpark festival of light and music and the Quartierfest were highlights. Outside the Circle too, Airport Shopping and the Airside Center saw a number of new offerings in the retail and restaurant/catering segments. Commercial turnover in the passenger zone developed in line with passenger volumes. In the publicly accessible areas, sales reached pre-crisis levels already towards the end of the reporting year.
The non-aviation business with the lively commercial centers and high-quality properties at the airport site are now making a major contribution to our revenue being broad-based, meaning that we are less dependent on the volatile flight business and our business model has become more resilient. We have also established a successful business area in aviation growth markets through our concessions in India and Brazil.
Continued development of airport infrastructure in Switzerland and abroad
2022 saw an increase in construction activity and investments, including for the two large-scale projects “Upgrading and expansion of the baggage sorting system” and “Development of landside passenger zones”. The architecture competition for the future Dock A with a tower and dock base was successfully concluded, and the renovation of runway 10/28 was even completed prior to the deadline. Our international business with a focus on the Indian and Latin American markets has become more firmly established in its separate division and has proven very robust. In the company’s largest international project, Noida International Airport near the Indian capital of Delhi, contracts were awarded in 2022 for construction of the infrastructure and various concessions. The construction work has begun and is scheduled for completion at the end of 2024.
Sustainability firmly enshrined in the corporate strategy
It is our ambition to achieve net zero greenhouse gas emissions already by 2040. Without offsetting, and across all our sites. In order to achieve our net zero goal, we are implementing various measures such as building renovations, the electrification of the vehicle fleet and a modern energy supply.
In the reporting year, Zurich Airport achieved the currently highest Airport Carbon Accreditation (ACA) level. ACA is a globally recognised programme of Airports Council International (ACI) which supports the climate protection aspirations of airports and monitors their progress. The airports in Florianópolis, Vitória and Macaé received ACA level-one accreditation.
Changes on the Management Board and Board of Directors
The Board of Directors has appointed the current CFO, Lukas Brosi, as the new CEO of Flughafen Zürich AG. He will take over from Stephan Widrig who, as announced, will leave the company at the end of April after 23 years. 44-year-old Lukas Brosi has worked at Flughafen Zürich AG since 2009, since 2017 as CFO and a member of the Management Board.
At the AGM the Board of Directors will propose Josef Felder as Chairman of the Board of Directors, to take over from Andreas Schmid who has been Chairman for the last 23 years and will be stepping down from the Board of Directors.. Josef Felder was CEO of Flughafen Zürich AG from 2000 to 2008, has served on the Board of Directors since 2017, and has also exercised supervisory roles on other prestigious boards for over 15 years. In addition, the Board of Directors will propose Claudia Pletscher as a new member of the Board of Directors to the General Meeting of Shareholders. Claudia Pletscher (48) is an entrepreneur and CEO of fineminds GmbH and a member of various boards of directors and advisory boards. With her expertise in digitalisation, innovation and transformation, Claudia Pletscher will be an ideal addition to the Board of Directors of Flughafen Zürich AG.
Likewise, a change is pending in the representative of the Canton of Zurich on the company's Board of Directors. At the end of April 2023, Beatrix Frey-Eigenmann will replace Eveline Saupper as a member of the Board of Directors of Flughafen Zürich AG.
Outlook
Flughafen Zürich AG expects air travel to continue recovering in the next few years. Passenger numbers at the Zurich site are expected to rise to around 26 million in 2023. The positive result for 2022 and the return to profit means that, after a break of several years, it is now possible to pay a dividend again. The Board of Directors has confirmed that it will retain the current payout ratio of around 40% of the net profit – adjusted for one-off effects – and that it will supplement it with an additional dividend from the capital contribution reserves. It will propose to the Annual General Meeting that an ordinary dividend of CHF 2.40 per share and an additional dividend of CHF 1.10 per share be paid.
In 2023, Zurich Airport will celebrate its 75th anniversary with a large airport party from 1-3 September, an anniversary exhibition in Airport Shopping during the summer months and many other highlights.
The Integrated Report 2022 of Flughafen Zürich AG is available online:
Integrated Report 2022
You can find up-to-date pictures here:
Photos (zurich-airport.com)