INTERIM REPORT OF COPENHAGEN AIRPORTS A/S (CPH) FOR THE PERIOD 1 JANUARY – 30 SEPTEMBER 2021
Stock Exchange Announcement
Copenhagen, 9 November 2021
The Board of Directors has today approved the interim report for the period 1 January – 30 September 2021.
SUMMARY OF THE FIRST NINE MONTHS OF 2021
Growth in passenger numbers during the summer and the receipt of DKK 120 million from the government support packages, meant that CPH closed out the third quarter at a DKK 77.2 million profit before tax and pre-tax loss of DKK 773.6 million for the first nine months of 2021.
A total of 3.8 million passengers passed through Copenhagen Airport’s terminals during the third quarter, and the traffic volume in September amounted to 46.2% of the volume in the same month of 2019, the last year of pre-pandemic normality. Air travel began to stage a comeback in Europe during the summer, supported by Covid passports, vaccines, eased restrictions and the underlying demand for travel.
While European traffic is making a comeback, things look very different for the long-haul intercontinental routes to the US or Asia, for example. Passenger numbers for these routes were at 13% of the 2019 levels, down from 2.9 million to 0.4 million.
Travel restrictions are largely lifted in Denmark, and the US and Thailand are reopening for tourism and travel in November. The US is one of the world’s most important markets. Before the coronavirus crisis, as many as one million people travelled on routes from the US to Denmark every year. It is essential for CPH’s status as a hub that transfer traffic starts up again, so passengers from the Nordics, the Baltics and Northern Europe can fly via Copenhagen to destinations in North America and Asia.
Borrowings due to the pandemic, now at DKK 2.2 billion
Despite the increase in passenger numbers during the summer, the early months of the year, continue to weigh on the performance for 2021 year to date. Due to COVID-19 CPH needed to draw DKK 129.8 million on its facilities to finance operations in the third quarter
Revenue was down by 67.5% relative to the first nine months of 2019, ending at DKK 1,073.7 million (relative to the same period of 2020, revenue was down 19.0%). For the third quarter, revenue totalled DKK 625.7 million, a 47.8% decline relative to the third quarter of 2019.
In May, CPH negotiated an extension to its DKK 6 billion credit facility until August 2023. At the same time, the current temporary waiver on certain debt conditions was agreed with the existing lenders until the end of 2022. Cash is critical in a severe crisis, such as the one CPH has been struggling with since March of last year. Currently CPH has had to draw DKK 2.2 billion on its credit facilities in order to keep the airport running.
Green transition under pressure
At CPH, ambitions remain intact for the green transition of aviation. In 2019, Copenhagen Airport was certified as carbon neutral under the Airport Carbon Accreditation programme. The target is for the airport to be emissions-free already by 2030.
The green transition is a particular challenge just now because airlines and airports are under extreme financial pressure. It is crucial that any future levies imposed on air travel are spent specifically to support a sustainable transition of aviation. In this context, the Aviation Climate Partnership has proposed to charge about DKK 30 per airline ticket and to channel the money raised to a climate fund to promote competitive green fuels produced that can contribute to creating a new industry adventure for Denmark in combination with efforts to develop aviation.
- The number of passengers at Copenhagen Airport was 5.2 million in the first nine months of 2021, a decrease of 22.2% compared to the same period of 2020 due to the effect of the COVID-19 pandemic. The number of locally departing passengers was 2.3 million (14.1% fewer than last year), while transfer passengers numbered 0.3 million (47.6% fewer than last year).
- Revenue amounted to DKK 1,073.7 million (2020: DKK 1,325.0 million), a 19.0% decline from last year.
- EBITDA was similarly affected and amounted to a profit of DKK 121.3 million (2020: profit of DKK 285.0 million), down DKK 163.7 million from last year.
- EBIT was a loss of DKK 654.8 million (2020: loss of DKK 366.4 million), corresponding to a decrease of DKK 288.4 million.
- Net financing costs amounted to DKK 118.8 million, which was DKK 31.6 million higher than the same period of 2020 due to an increase in committed credit facilities and recycling of amortised financial costs in 2021.
- The result before tax was down by DKK 320.0 million to a loss of DKK 773.6 million (2020: loss of DKK 453.6 million).
- Capital investments (excluding the contribution of the Comfort Hotel) amounted to DKK 420.1 million in the first nine months of 2021 (2020: DKK 1,229.0 million). Investments included the expansion of Terminal 3, the construction of a multi-storey car park, new baggage facilities, runway maintenance, various IT systems, as well as miscellaneous improvement and maintenance work.
OUTLOOK FOR 2021
The future development of the COVID-19 pandemic continues to be uncertain. Regulation or other limitations restricting international travel may still have a significant adverse effect on the aviation industry as well as passenger levels.
Revenue is mainly passenger-driven and hence remains equally uncertain, while CPH’s cost base for the rest of the year largely fixed.
This uncertainty is reflected in the range for the profit before tax outlook. Based on current conditions, management expects a loss before tax for the full year within the range of DKK -800m to DKK -700m.
CAPEX spend for the year is expected to be DKK 550-600 million.
Dividends to shareholders have been suspended for now due to the financial situation and conditions for receiving compensation from the Danish government’s support packages. Furthermore, the DKK 6 billion credit facilities agreement and the loan covenant waiver agreements with existing lenders, which were entered into in May 2020 have been extended, and in this connection CPH has agreed not to pay out dividends in the period until 22 August 2023.
P.O. Box 74
2770 Kastrup, Denmark
Tel.: +45 3231 3231
CVR no. 14 70 72 04