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SYDNEY Airport (ASX: SYD) has posted a first half profit rise of 4.4 percent to $166.6 million, thanks to a rise in international passenger numbers.
The airport processed 21 million passengers in the six months to June 30, up from 20.2 million from the previous year, with international travellers increasing by 7.7 per cent and domestic up by 1.3 per cent.
The growth in passengers helped generate revenue of $714.2 million for the six months ending 30 June 2017, up from $661.9 million in 2016.
"The inbound tourism market has seen strong growth of nearly 10 per cent for the half and the rolling 12 months, with excellent performance from a diverse range of major Asian markets including China, India, Philippines, Indonesia, Japan and Vietnam," says Sydney Airport CEO Kerrie Mather.
All of Sydney Airport's divisions generated a rise in revenue including aeronautical, retail, property, car rental and parking, which recorded a modest 2.2 per cent rise because of a shift in choice to trains and ride sharing services.
As a result of the strong first half results, Sydney Airport has upgraded its 2017 distribution guidance to 34.5 cents per security, up 11.3 per cent on the prior corresponding period.
Mather, who announced her resignation earlier in the year, says the airport will continue to invest in improving facilities for both passengers and airlines during the rest of the 2017 calendar year.
"Our capex program over the last 12 months has delivered nearly $400 million in improved facilities for passengers and airlines, with over $250 million more to be delivered in the second half of 2017," says Mather.
"We continue to deliver on our strategy of investing in a significant improvement in customer experience and capacity to support our airline partners' growth."
Retail in both the international and domestic terminals of Sydney Airport grew 14.3 per cent to $162.2 million thanks to new additions in both the shopping and food and beverage categories.
High electricity prices hit the airport hard and helped contribute to an $11.4 million increase (9 per cent) in the company's operating expenses to $136.6 million.
Sydney Airport will continue with its expansion into hotel development and expects revenues to be boosted by the opening of their new Mantra hotel and the $34.5 million acquisition of an Ibis budget hotel in July.
Business News Australia
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