Aeroports de Paris SA
PAR:ADP
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
103.7
132.4
|
| Price Target |
|
We'll email you a reminder when the closing price reaches EUR.
Choose the stock you wish to monitor with a price alert.
This alert will be permanently deleted.
Aeroports de Paris SA
You don't have any saved screeners yet
Welcome to the Groupe ADP 2018 first quarter revenue conference call, today's conference is being recorded. I now hand over to Mr. Philippe Pascal, Chief Financial Officer. Sir, please go ahead.
Good morning ladies and gentlemen, thank you for attending our first quarter conference call. Please be aware that we broadcast a live audio-cast on our website, where you will find the presentation. For first quarter of 2018, our revenue reached EUR 965 million, up by 37.3%, if we consider our revenue before our full consolidation of TAV Airport, it reached EUR 723 million up by 2.8%. Three main characteristic of this first quarter, first, the growth is mainly driven by a good traffic growth, second characteristic our retailer activities are positive impacted by bar and restaurant, which continue to show good growth around 18%. However, the sales per PAX are slightly decreased because of strong euros and ongoing works in terminal 2. And the third characteristic is the international side TAV Airport presented a good result with a strong traffic growth. Finally, all-in-all considering the Q1 revenue our 2018 guidance are confirmed.Slide 1, we can see the dynamism of traffic in Paris Aeroport when you see the traffic in Paris we can see growth plus 3.7% with specifically for Paris-Charles de Gaulle Airport plus 4.6% and for Paris-Orly plus 1.8%. Due to the good performance of the international traffic plus 6.3% and the dynamism of low-cost company plus 10%. Including our participation aboard our total traffic reached more than 53 million passengers up by 13.6%.TAV Airport growth traffic shows very strong performance with plus 23.4% and in Santiago de Chile plus 14% to reach 6.3 million passenger at the end of March.Slide 2, in term of mix traffic you can see the total Paris traffic plus 3.7% compared to the international traffic plus 6.3%, so we have a good mix traffic, very good mix traffic with an increase in terms of load factor plus 2.1 points.If you have a look to the destination we can see a very good increase in traffic in Asia in particular with China plus 8.2%, in Africa plus 8.1%, in North America plus 6.8%, and in Europe plus 4%. Specifically in Europe, you can see a growth with Southern Europe with Spain plus 7.6%, Portugal plus 11.6%, and Italy plus 5.4%.Slide 3, the second drivers of our activities is retail, where you can see in term of retail an increase in our revenue plus 3.3%, driven by the growth of traffic since the beginning of the year. Well, in term of -- in detail, in term of bar and restaurant we have a good performance plus 18.12% due first to roll out of EPIGO and second as a full year impact of the opening in 2017 of new shops.In landside shop, we have a very good performance plus 15.8% and in airside shop a slight increase with 1.8%. We observe a slight increase in terms of sales per PAX by -- a slight decrease in term of sales per PAX by 1.4% due to 2 main issue, first the negative impact of [indiscernible] and second, refurbishment works of airside shops in particular in terminals usually contributing well to the sales per PAX the Hall K and the Hall L in Terminal 2E.In detail Slide 4, in term of revenue. You can see for the aviation activities plus 2.8% due to the good traffic mix and the volume of traffic and the slight increase in our tariff last year around 1% on April 2017.In retail and services segment an increase on 3.12% thanks to the improvements in retail activities, as I mentioned previously, we have a slight decrease in the car park activities due in particular to Hall E to the works in the specific car park, with the construction building of the new station subway station in Orly. And in the real estate segment, an increase by 2.7% with the growth in external revenue plus 4%, thanks to the positive effects following the takeover of the Dome in 2017. We have a decrease in the internal revenue due to the reason of our internal rents to the market price.Finally, for the international activities, we have a slight decrease due to the end of the mission of assistance for commissioning [indiscernible] 2 new terminals last -- at the beginning of this year. For the other activity segments revenue, be careful we change our consolidation methods for sales after the sales of 80% of the stake in the entity September last year.The -- and next slide, Slide 5, we have the specific focus of TAV Airport as Groupe ADP has fully consolidated TAV Airport since July last year, so we have a good base effect for the first quarter. The contribution of TAV Airport is accounting for the international and airport development segments and amounted to EUR 243 million at the end of March so plus 6.2% compared to the same period of last year.In term of dynamism of traffic, you can see a very strong fees in Istanbul Ataturk plus 21% in Ankara plus 41% and in Izmir plus 17%. So very good contribution for the main aeronautical activities but also for the main subsidiaries of TAV Airport.This year the food and beverage subsidiaries we have a very strong performance plus 11%, the TAV operation services the main commercial area location plus 15% and HAVAS the other subsidiaries of ground handling for TAV plus 3%. So we have a very good performance despite weak Turkish lira and US dollar versus euro.So thank you for your attention I am now available for your question.
[Operator Instructions]. We'll take our first quarter from Vittorio Carelli from Banco Santander.
Thank you for receiving my questions. The first one is related to TAV. Can you give us more light about what to expect in the coming months, apart from the negotiation of the compensation? When should we expect the operations to move 100% the new -- to the new airport? And which would be the impact on the revenues of TAV? This is just to understand how to model these in the coming 12-18 months. And the second question is very easy, how should we think about the retail spend to PAX in 2018? And is this something this minus 1.34%, is something that you were expecting or is it tougher than your forecast?
So first question about TAV airport. So we are still in negotiation with the Turkish government for the composition. We have a very good discussion. We are very optimistic about that. And our goal it's to finalize the negotiation before the first opening of the new airport in the next October. So we are specific advisor to the Turkish government as a -- so in -- advisor, very good advisor internal, external advisor. So it's a very rationale negotiation. And we are in a good way. In term of [ mover ] in the new airports, it's difficult to say if the -- what is clearly -- there's a good agenda that is clear. We have a small opening at the end of October it's a link planned for us, it's the move of Turkish Airline, it's a hub of Turkish Airline. It's a huge move. If it’s at the end of this year, the beginning of the next year, it's difficult to say that is very clear, so building is in a good way to finalize and to open at the end of this year. The runway, and the taxiway, we have 2 runway and it's quasi finalized but the taxiway, for the moment, it's not built -- are not built. So it's difficult to say if it's enough to move Turkish Airline that is very clear, for the moment, TAV wants to develop the activities in the new airport, especially with our [indiscernible] and so on to be able to catch more value in the new airport. This is very important move for us. Finally, in terms of value creation for TAV, we are very optimistic because, as you know, we finalized the negotiation with -- to buy around 50%, exactly 49% of the stake of [indiscernible] And we have a good ID to develop TAV in Africa, in Middle East, but also in the east of Europe the next months. This is for your first question. For the second question, sales per PAX in Paris. As you know, we don't disclose specific assumption for the end of this year. We disclose in our annual result the 3 main drivers for the sales per PAX, quality of the offering, traffic mix and then the increase in term of square meter. You can see for this year, in 2018, we expect a slight decrease in term of square meter due to the huge walk specifically at the -- out of the hub, a huge walk to reach our base and our retail area. And after this year, we have strong increase to the new shop in the current terminal but also a new shop in the new junction building in Paris-Orly in 2019 but also in Paris-Charles de Gaulle in 2020 with a junction with international satellite in Terminal 1 and junction between Terminal 2b and 2d. So for this year, we expect in term of sales per PAX, a stability or a slight increase maximum but it's not the heart of our strategy, the heart of strategy it's to reach, at the end of 2020, the full year aspect our guidance and we can confirm our guidance with EUR 23 per passengers. So this is for the retailer. The next question, please?
Our next question comes from Ruxandra Haradau-Doser from Kepler Cheuvreux.
3 questions, please. What capacity growth do you expect at Paris Airport during the summer flight schedule? Second, over the last weeks, what has been the average impacts on your traffic from 1 day of strikes at Air France? And sir, would you please give us an update on Santiago de Chile airport? How is the CapEx program progressing and [indiscernible] that IATA has asked the government for a change of the terms of the concession, do you see a chance this to happen?
Thank you, Ruxandra, for your first question. For the next semester then we are very optimistic with a new line in Paris-Charles de Gaulle and in Orly. In term of annual basis, we expect 15 new line in Paris-Charles de Gaulle probably 14 in Orly. And so in term of -- for this season, for the [ summer ] season and the next season, despite this good news, it's too early to give specific figures in term of capacity. In term of [ hike ] what is very clear for us it -- we can confirm our guidance for our 2018 guidance, traffic growth between 2.5% and 3.5%. So initially, as you know, our guidance may have been considered by analysts as questions. In fact, we always factor in our guidance the [ prevalence ] for snow, for strike at the beginning of this year. So as of today, considering the Air France strike, we have used part of the prevalence but we are still confident to reach our guidance at the end of this year. We don't disclose a specific figures due to the number -- for example, the number of PAX for each day. But we are very confident too, for the moment, in our guidance. Your third question in term of Chile, so traffic into Chile increased by 14% in Q1 compares as in the next year we are very confident because it's a very good and efficient airport. We are still a confidence to build, there's new extension of this airport. In term of concession, for the moment, we don't -- it's too early to speak about that and we don't disclose anything, any good news, or any bad news for the moment.
Our next question comes from Cristian Nedelcu from UBS.
The first one is on retail. Could you give us some color around, when do you expect to reach the peak headwind from the refurbishment works in terms of retail spend, was Q1 already the peak or do you expect that to happen over the next quarters? Secondly, could you provide any color in terms of the fine line for what concerns the government decision around the potential disposal of the stake? Do you have any visibility there? And the last from my side, please. In terms of pipeline of airport privatization going forward, I think the press articles are mentioning there could be several projects later this year. Are you analyzing that, do you have anything on your agenda in that regard? These are all my questions.
So thank you for question. In term of sales per PAX, as you know, we are in fact a huge refurbishment in Terminal 2E, specifically in Terminal -- Hall L in Terminal 2E. And it's a huge work for all this year and we step by step we open new shop probably at the end of this year and the beginning of the next year. In terms of -- this is the main point for us as you know in the first quarter we delivered a new huge retail area, we have stills -- there is a picture in the first slide of this presentation. With Buy Paris Duty Free a new concept in fashion and care business, specifically perfume, alcohol and so on. So we expect a very good impact due to -- with new concept, very closed concept if you compare with the offering in the downtown of Paris. So in our square meter agenda for sales per PAX, I think it's very important if you can have a look in Slide 56 in the toolbox in the stuff we can find in our website or we can ask from Audrey and Caroline. And I think it's a very good way to modelize the projected income of sales per PAX. Second question regarding [indiscernible] privatization. Management has not received any news information from the French state at this stage. So it's difficult comment more on this operation, as a potential operation it's difficult to say. In term of agenda, despite the fact we expect the decision of the French state, the management work, work a lot to improve the operational activities and to develop our activities in Paris but also in the international developed segment. As you know we work about [indiscernible] probably we expect a good news at the end of this year, probably at the beginning of next year. And we capture or we wanted to capture potential opportunity with our new office in Hong Kong and in New York [indiscernible] in Americas, in North America but also in South America and in Asia, specifically in Japan for the moment. So, what is very important for us it's to develop our engineering activities and to conquer new markets, especially in Asia. So thank you very much. Next question, please.
Our next question comes from Stephanie D'Ath from RBC.
My first question is a follow up on the Air France strikes question. Could you maybe tell us how many days of strike you factor at the start of the year, or how many days of bad weather do you assume? And when in terms of that specific events in terms of days do we start to worry? And my second question is regarding sort of again on the government stake, potential sale. I think -- in March and April there were supposed to be 2 milestone regarding the PAX flow that would allow the French government to decrease their stake below 50%, that was postponed, and do you have any insight on the timeline of when they will go over that subject again? And then finally, just more technically, could you please explain in retailing services other income, whether -- explain the 70% increase and in the interest segment elimination what explains the 26% decrease?
So the first question can -- of strike. So we don't disclose specific figures, it's difficult to have a good communication about that. It's -- what is very clear for us is we have an impact in term of strike. But what is very clear also it's the situation of how it's very important it's our first [ tryout ] and it's not possible for me to comment more the impact of strikes of our main client. First point. Second point in terms of privatization, as I say, management has not received any new information for the French stake. It’s a decision of our main shareholder, it's not the decision of management. So it is difficult to say and to think for the French government, the -- it’s a decision of the French government. And your last question in term of other income in the retail segment. Its -- the main impact is due to the works of the associated [ Grand Paris ] to build a new station and to build a new station in Paris-Orly. As you know we receive an indemnity to compensate the destruction of building and the refurbishment and the building of new part of the airport. So it is usually work in our activities. In terms of your first question in terms of inter-segment elimination, it's just the deconsolidation of Hub Safe after the sale of 80% last year.
Thank you very much.
Thank you. Next question?
[Operator Instructions] Our next question comes from Johannes Braun from MainFirst.
I have 3 questions they all relate to your international subsidiaries. Firstly, what's the expectation on Santiago this year in terms of, I guess, profit and traffic the second one has been very strong in terms of traffic? And then secondly, what has been the equity contribution of Santiago de Chile for fiscal '17? I couldn’t find this information in your annual report. And then lastly, what do you expect in terms of dividends from [indiscernible] and also Santiago de Chile this year based on their 2017 results?
So in term of Santiago de Chile, in fact in terms of [indiscernible] of traffic we have good [indiscernible] for the first quarter of 14% and we have a good dynamism for the traffic for the global year, but we don't disclose specific assumption for the traffic in Santiago de Chile, probably their good performance. In term of equity contribution, we don't disclose that, it's confidential for us. And so it's not possible for me to answer to your question. Again, I think we have a very good relation in -- with the Chile government and with -- specifically with the new government and we work to have very good times in this airport we've have a huge potential profit. So thank you. [indiscernible] for the specific question about the effect for the sales impacts in 2018, as you know with FX effects -- many affecting our retail activities, a good impact, but also a bad impact, for example, for the US dollar and as well as the sterling, but we don't disclose specifically the default impact and the result in our model about the FX effect. The second question of Deutsche Bank about, the summer season [indiscernible] I am already answer after the question of Ruxandra. So if you have a next question?
No question.
To next question.
Our next question comes from Stephanie D'Ath from RBC.
Yes I had a follow up on retail piece, in the stores that are not part of Terminal 2E, could you maybe give us an underlying performance in terms of sales growth from the non food businesses, just to understand this -- the euro is impacting more, I would expect Terminal 2 refurbishment to be much more of an impact but how is underlying and retail doing there, and car park was launched, if you could you give us some details on that. And on [ Jordon ] and acquisition, could you give us the details on how that really impacts your outcome going forward and how we should reset that.
So for your second question about -- Jordon airport [ Admen ] airport, as you know we don't disclose a specific figure for this year but we can have a good view of the impact for the full year, if you compare with next year, we have a good trend so it's necessarily for us better than the last year, for 2017 financial year the Admen airport EBITDA reached EUR 66.3 million for the full year, so as you know we have a full consolidation in our account for the 9 months. If you reach the number of passenger, we have strong increase last year around 6.8% compared to 2016. And in the beginning of this year in January and March, an increase around 8.5% compared to the same period in 2017. So your first question in terms of. So for your first question in term of sales per PAX? So [indiscernible] for the first question --
It's not necessarily sales per PAX it's just the sales of the stores that are not part of Terminal 2E.
In Terminal 2E in term of, we don't disclose the detail in the first quarter, it's too early in the year but it's very clear for us, we have a good way in term of first new in all our shops, specifically in Terminal 2E but we have an impact in Terminal 4. We have 2 kind of revenue, we have the revenue in the air flight shop we have a slight increase, and the revenue in the long flight shop we have a strong increase due to the new policy, with our specific shop employees in the platform -- increase almost 16%, it’s a very huge increase we wanted to catch more value, with specific clients, internal clients of platform -- client -- officers -- employees of ADP, but also of all the airlines. So we have a good policy to catch more value for that in term of revenue. So sorry for my -- it is not very -- we have not a lot of details but we have to wait.
Our next question comes from Charles Maynadier, from Kempen.
Just one follow up for me on TAV, so I understand you are negotiating with the government now on the potential compensation scenarios, but could you give us more color on the scenarios of compensation, would you be looking at let's say annual cash payments or extending the concessions, so just trying to understand what you're looking for, any negotiations.
Okay, you have got a clear question, so our priority it's to have cash, it's our priority and we still -- begin negotiation with cash, after if we have to negotiate with the Turkish government and if we're -- it's very important to have a part for the Turkish government, and part of expanding our concession for example in Ankara and so on. It's not our priority but it's still possible. As you know we have a very strong increase in the Turkish concession, specifically in Ankara in [indiscernible]. We will be -- compensate, for the loss of EBITDA, so we have to estimate our EBITDA first 2019 and 2020, and to estimate the impact of the loss of EBITDA, so the impact of dynamism of traffic and so on. So it's not a huge work but we have to negotiate issue by issue and to modelize together the increase of EBITDA for the next 2 years. But we are -- in fact I am confident -- that is very important for us, ADP -- it's a huge investor in Turkey, and for the Turkish government it's -- when ADP increase the stake last year, it's a very good news for the Turkish government, so it's -- we have a very good relationship.
There are no further questions over the phone.
So thank you very much ladies and gentlemen, so see you for the half results in July. Thank you very much bye-bye.
This concludes today's call, thank you for your participation, you may now disconnect.