ACI reviews airport industry’s financial performance for 2021

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Airports Council International (ACI) World has published its 2023 edition of the Airport Economics Report and Key Performance Indicators (KPIs), presenting a comprehensive view of the airport industry’s financial performance for the 2021 year.

The annual Airport Economics Report presents a global analysis of airport industry revenues by source, costs and related trends across the globe and over time, while the KPIs report provides insight into areas such as financial performance, fixed-asset productivity and airport operations through detailed statistics. Data is gathered from over 1,000 airports of all sizes and business models, representing 82% of the world’s pre-Covid-19 pandemic traffic.

The report found that aeronautical revenue was the largest source of income for airports, representing 50% of the total. Beyond aeronautical revenue, airports were found to be exploring new sources of revenue on the non-aeronautical side of the business such as real estate development to mitigate traffic risk and adapt to changing market conditions.

Other key highlights from the 2023 Airport Economics Report and KPIs included: the continued financial impact experienced by the airport industry experienced in 2021 as a result of the Covid-19 pandemic; the average cost per passenger far exceeded the average revenue due to the capital-intensive nature of the airport business with many fixed costs; the industry faced substantial financial pressures, and the ongoing need for infrastructure investments meant that airports increased their levels of debt during 2021 to finance operations; and in 2021, the industry’s debt to earnings before interest, taxes, depreciation and amortization (EBITDA) ratio was 13:1, in contrast to the 2019 average that was in the realm of 5:1.

Luis Felipe de Oliveira, director general of ACI World, said, “This year’s report presents an overview of the industry’s financial recovery trends across the world as it emerged out of the pandemic. There is no denying that airports are infrastructure-intensive businesses—the cost structure is characterized by prominent fixed costs. Under a regulated regime of airport charges that do not adjust to actual market and demand conditions, there should be full awareness of the fact that the regulated formula that protects airlines in good times also requires protecting airports in bad times.

“Beyond the impact of the Covid-19 pandemic, airports need the support of governments through better global policy frameworks on airport charges. In a changed competitive landscape, light-handed models of economic oversight need greater consideration in global policy frameworks on airport charges – airports must be given greater freedom to operate as businesses in their own right. Regulators and the rest of the aviation ecosystem must work together—so airports can continue to play a vital role in the global economy, serving as critical infrastructure for the movement of people and goods.”

Read more Covid-19 updates from the passenger terminal industry, here.

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