German airport owner and operator Fraport has reported record profits for the last year, despite a dip in passengers using Frankfurt airport.
Passenger traffic dipped slightly by 0.4% to 60.79 million passengers, in contrast to an increase generally across European airports, thanks to the continuing impact of the low-cost segment.
Fraport CEO Dr Stefan Schulte (above) also blamed the fall on the increased risk of terrorism: “The geopolitical situation and terror risks in Europe were decisive factors contributing to fewer passengers, particularly from Asia and the USA.
“Frankfurt Airport’s passenger traffic was also impacted by the strong growth of low-cost carriers, especially at those airports within our catchment area. We have initiated the necessary response to this development by opening up Frankfurt Airport to the low-cost segment. Nevertheless, our core business continues to be the premium hub segment and our partnership with Lufthansa as our main customer.”
Despite the challenging market, Fraport achieved a net profit of €400m (US$447m), thanks primarily to its international activities – managing airport improvement projects and operating airports outside of Germany.
The company was also boosted by a €240m (US$270m) compensation payment it received last year in connection with a terminal project in Manila. It also sold part of its stake in its St Petersburg subsidiary to the Qatar Investment Authority for between €40m (US$45m) last year.
Fraport expects passenger traffic at Frankfurt Airport to grow by up to 4% in the next year and is planning to build a €200m (US$224m) pier dedicated to low-cost carriers with a capacity to handle up to 6 million passengers.
Speaking at Fraport’s annual general meeting, Dr Schulte said he plans to grow Frankfurt Airport in the future by attracting low cost carriers: “Customers today expect low-cost flight offers. We have been losing significant traffic share to neighboring competitor airports offering low-cost airline services. Hence, a major aviation gateway like Frankfurt cannot continue to ignore this market trend over the long run.”
