Flughafen Wien AG

roughly 900 million and you can now take the respective slide to visualize it also. It's the next slide, please. Where you see how we step by step reduced our net debt position up to 149 million plus to start with all the projects that have been delayed unfortunately by by kobe and the problems accompanied by that we also reported a very robust equity see in the slide, the previous slide and our cash flow from operating activities increased to 337 million compared to 105 million last year. Given that positive development, our dividend proposal to the annual general Assembly will be 60% of the group net profit, so exactly what it was in 2019. That equals 77 cents per share. And if things go as well as we expect them right now for 2023, we will be in the position to even increase the payout ratio for 2023. So to let our I think one essential pillar of the positive development of our company is the fact that we are listed on the stock market and this is what we think would also be the best for the company in the years to come and therefore we will support to the utmost possible extent meant to maintain the free float as an important corporate objective. If we look in detail, you see that our EBITDA doubled almost compared to 2021. And overall, we could increase and improve the productivity Our EBITDAE margin should be again above 40%, so more or less at the level we saw in pre-crisis years. The earnings before interest and taxes were at 167. Financial results improved to 9.3 million minus. and you know that we are still repaying the EIB loan. In this respect, the rising interest rates are favorable for our company because perhaps we reach the level of the interest rate that we have to pay for this loan. And this would enable us then to repay the loan in total or even major parts of it. And by doing that, we would also have benefits for the coming years in respect of a better or even positive financial result. Earning before tax at 157 compared to 9.5. and net profit after non-controlling interest 107.9 you might ask why there is such a difference this year between net profit for the period and after non-controlling interest that has to be attributed to an extraordinary a positive result of our subsidiary in malta if we look ahead for 2023. I think from today's perspective we will see further growth both on the passenger side but also on our airport city and business location projects and a considerable number of companies already opted to come to the airport Especially, I would point out one company, it's Enpulsion. You may have not heard of them before, but it's a highly innovative, very fast growing company from Wiener Neustadt in Austria. and they are producing satellite propulsion systems especially for the elon musk starlink project and they are growing on a very very high speed and they rent roughly 4 600 square meters and have an option for another 2 300 So the facilities that have been left by Austria in the crisis are now more or less again granted to this company and they will produce on the airport. Our investment next year should go up to 135 million. It includes the start of the southern enlargement terminal project and the further expansion of our photovoltaic facilities, which will be increased to roughly 45 hectares and the production of roughly 45 million kilowatt hours. which equals 40 to 45% of the electricity consumption of the total system on the airport. So not only the airport itself, but also the companies that are working here. All these investments, as you will see, are financed from our cash flow. and we expect the revenues of about 830 million, an EBITDA of at least 325 million and net profit of 150 million. We are operating CO2 neutral since the start of January 23 and our sustainability goal for 2033 will be to get a net zero status and we will really concentrate on further improving all our activities in regard of technology, of energy consumption optimization and even of production on our own. So let's move on to the operating expenses. Clearly, you see that hand in hand with the increased traffic, our consumables and services used went up. But I have to stress that energy prices did not very much hurt us because we had a very conservative purchasing strategy in place since years, so we have bought electricity for 22 already in 2019 and 2018, and we have provided already roughly 25% by our own PV production. Personal costs clearly went up substantially, And what you have to understand there is that we added roughly 12 million to personal provisions because you may be aware that we reduced our staff in the period of Corona by roughly 1,000 heads. and we put 280 people in our new placement agency and for most of them, so more than 200, we found new jobs inside the company or outside the company and there is a rest of roughly 50 people Mostly ill people who are handicapped cannot do the work they did before and they have a fixed contract so they cannot be laid off and therefore we made a provision for all future potential costs out of that. that are now part of the personal costs in 22 and will be a relief also for 23 in the following year as i already pointed out in the following slide you see our balance sheet structure is very healthy our equity is at 1.448 billion equity ratio at 65.1 percent and also we have net liquidity and strong cash flow so are ready for all the investments that are planned the coming years to enhance growth and to enhance also the profitability of our company one very important decision of the austrian government and the austrian parliament was protection against inflation. So the classic tariff formula has been suspended until the end of 26 due to the COVID related distortions. And the increases are now based on the average inflation rate on a yearly basis calculated from 1st of August to 31st of July. and an earlier return to the price model is only possible if the three-year average of traffic volumes exceeds the comparable figures of 2016 to 2019. The security fees include also the extra costs for the implementation of the entry exit system. A very important decision that shows the confidence in the further development of our company was the decision of the Windham Group to build a third hotel at our site, the Vienna House Easy with 510 rooms. It's a very big hotel. and it shows that also third-party investors are convinced that our company will develop in a very good way in the coming years. Construction will start later this year and the opening is planned already for spring 2025. and this will increase the room capacity on the airport up to 1400 rooms and will especially support our airport city strategy with conferencing center, seminars and all that stuff. As I already pointed out, we have the plan to increase PV capacity to about 45 hectares at the site in Bad Füßlau, our airfield south of Vienna. And the project will be finalized in the course of 2023. You have for sure monitored the development regarding the takeover bid by one of our co-shareholders IFM. From the outstanding stake 3.37% accepted the offer. did not accept the offer, so two-thirds of our investors rejected the purchase offer, which we see as a clear vote of confidence. In regard of growth, profitability and attractive dividend policy, the strong destination of Vienna and our sustainability policy And we hope that we can convince these investors also in the years to come. So last but not least, summing up the financial guidance for 2023 revenue around 830, ABTR higher than 325, net profit higher than 150, and capex approximately 135 million. So that's from my side. And if you have questions in regard of that, we can follow that after Julian did his presentation.

Good afternoon, ladies and gentlemen. I would like to continue with traffic, our segment results and a bit of an outlook for 2023. I think overall, we were very happy with the strong growth of 2022. Passenger numbers are the main drivers of our results. So therefore, we are happy that we had 30 million passengers again in the group. And the result is just presented to you. We expect passenger volumes to increase further in 2023. We gave our guidance in January with 26 to 27 million passengers in Vienna and 32 to 34 million in the group. We are very happy that January already went pretty well. We had roughly 10% below the passenger numbers in it's pretty good. The outlook is positive, so we are very sure or at least as true as you can be in nowadays so without any additional external major crisis to reach the 26 to 27 million passengers i'm very curious to see the numbers in the second quarter so i think q2 with the summer schedule already in place and it will give us a first indication If the weekend leisure passengers are back, how much of the business passengers are coming back and summer should be in any case good. So far what I get to know from our airline customers bookings are really really good for the remainder of the year. We are very well equipped for this passenger growth. 2022 i think compared to many many other airports worked very very well operationally for us we started in january again with a very good result and we we intend to hire around about 350 new employees for the summer season terminal operation security operation ground handling and and I have to say things look better now than probably three or four months ago. So we are very confident that we will have a good and solid summer operation again. A major focus is obviously retail. Around about 80-90% of our EBIT is coming from center management and retail. new openings by Figi Müller, Do & Co, Villa, Burger King, Costa Coffee. So for the strong summer season, the offering for our passengers should be significantly better than it is today. And then the major change will be our southern enlargement, where I will show you some details later on. Yeah, I think we covered that already. Let's move on. The airport segment, finally we were out of the crisis with the result of an EBIT of close to 50 million euros, external revenue 321 million, EBITDA 127 million. major driver obviously passenger and aircraft related fees one can see here as well patient related fees more than double aircraft related fees plus 73 percent so this shows as well that there is a change in the traffic pattern. The passengers are already closer to the 2019 figures than the aircraft movement, which is a good development and it shows that on average the aircraft are bigger and the take-up from passengers is higher than it used to be, which is overall a very good development for us. In 2022 we had roughly revenue a net revenue from airport charges by roughly 13 euros per passenger and we expect 2023 to be somewhere between 14 euro 50 and 15 euros per departing peg so this shows you as well what kunt already mentioned the increase in in our airport charges with an increase of mid of 22, so there will be another significant increase then in January 2023. Let's move on to the ground handling and security services segment. This is the biggest challenge undoubtedly. We reduced the minus here. It was still in the negative territory of minus 3.5 million and we are very determined to move this segment into the positive territory in the course of 2023. I'm very optimistic that we will manage to do so. On the one hand we expect further traffic growth and on the other hand we managed to increase the average price quite significantly already. So there were some extraordinary price increases due to the inflation. And as I said, I think we have a very stable operation. Our services are doing an excellent job compared to most airports in Europe. And you can see here in January, significantly more punctual than the other airports in Lufthansa Group, Munich, Zurich, Frankfurt. So I think this is a good basis to negotiate prices with customers, and that's what we are doing right now. As I said, we are determined to move this segment into the positive territory in the course of this year. We were already amongst the top performers in terms of punctuality and quality in 2022, and our aim is to keep this position. As I said, on the one hand, this helps us to negotiate higher ground handling prices. On the other hand, I think this is one of the reasons as well, the good performance together with our home carrier, Australian Airlines, that the positioning of Australian Airlines within Lufthansa Group changed. Austrian Airlines is the top performer in terms of punctuality in the group in the last 12 months. And even from a financial point of view, Austrian Airlines is doing much better now. I think overall, Lufthansa managed very well to secure the so-called DACH markets of the German-speaking countries and to increase ticket prices in this area. the coming months. Retail and properties I already mentioned that there will be quite some openings in the course of the coming weeks. The most important area here in this segment is center management and hospitality with close to 50% of the revenues in this segment let's move on so here you can see some of the openings which we intend to doing in the coming months the good thing is that duty free is already trading on the 2019 levels so obviously there's an inflationary effect here and at this point duty free is doing very well F&B sector is trading above the 2019 levels the only area which is suffering is specialty retail there we see the lack of Chinese and Russian passengers significantly but there will be a major game changer now with the south extension which we intend to build until 2027 you can see here some some F&B and retail and I'm sure we will manage to get some luxury retail to the airport and we will increase our offering in terms of F&B as well. I think right now we don't have enough space for F&Bs and we will have a centralized duty-free shop and two duty-free shops on top of each other. So I think this is one of the important areas which will change. And the second one is that dwell time should increase very significantly as well. We will have 18 bus gates directly on the ground floor of this building, so people don't have to walk 400 metres to the gates. They will remain there and then go much later to the gates. We will have a centralised passport control to channel all the high-value non-Cheney passengers through the luxury shops. So overall, this should increase both the quality for our passengers, but on the other hand, the sales for us and our operators very significantly. And we expect that at least we will have an increase by 50%. So this should increase our revenues very significantly. Malta, exceptionally well. I think what is really important there is that we have a very close cooperation with government. I think there is a good mix now with locals. well. So traffic in January was already above the 2019 levels. So the outlook for this year is strong as well. And we are very grateful for the support of government to the whole aviation sector to the airport sector in particular. So we call the 2022 subsidy of 20 million euros as a tax credit and a to the airport and deviation sector. We are heavily investing in Malta as well. So we are going to build a hotel. We extend the business center there. We're going to increase the terminal and we're going to add some stands for the aircraft. So we prepare ourselves for further growth in Malta. And finally, just a bit of an outlook too much detail there but we see a lot of growth now already towards Asia although I think China will take a couple of months or until next year until there will be a significant growth I think the whole Chinese travel industry will need a bit of time to prepare But overall, long haul is doing very well. And we saw some increases from Air Canada, Ethiopian. Maybe we move on to the next slide. India is resuming flights from daily service. India is a strong growth market in the years to come with all the additional aircraft they are buying. Azerbaijan Airlines is coming to Vienna Ryan and Luisa are all looking at some growth in 2023. So I think overall we are very optimistic and I would like to finish off again with our forecast 26 to 27 million in Vienna, 32 to 34 million in the group and I think this forecast and this projection is standing on very solid ground. So that's it from my end and I'm looking forward to your questions and our discussions.

Thank you very much, gentlemen, and I open the room for questions.

Hello, good afternoon. Can you hear me? Here is Vladimirov Vankova speaking.

Yes, we do. Good afternoon.

I would like to have just a couple of questions for the beginning and to leave some more room for other participants. My question would be related to inflationary pressures, which we see across the board. So what do you expect from 2023 regarding inflation, in particular for your personal cost? and this will be partly offset with the airport charges increase based on inflation and maybe here I didn't understand fully what will be the full year increase because you indicated increase from January and then you said that there will be some more increase but I don't know how much from when and how it will translate for the full year 2023 increase in airport charges. Then one more question would be related to your tax rate. You mentioned 12 million tax credit subsidy, so I think this was maybe the reason for the fourth quarter tax with the opposite sign, so to say. What is the outlook for the tax rate for 2023? And maybe if you could be a little bit more concrete, you said that you are considering to increase payout ratio. What kind of payout ratio we are talking about for the year 2023? Thank you very much for taking my questions.

Yeah, thank you. Fine. Starting with your last question, I think it's a little bit too early to give a more detailed guidance on that. but if it's 60 now and we will increase it so it will be definitely above 60 where we then finally will end up is in any case linked to the business results of the year, and finally also to our proposal, which will then be made for our supervisory board and the General Assembly. But if you look at the balance sheet of the company and the outlook, I think it shows that we have room to maneuver. In regard of tax rate, you can firstly expect that the Austrian corporate tax in the first step will be reduced from 25% to 24% in 2023. So this is in any case supportive for the result after tax. And besides that, we will see a somehow normalized tax rate. So in total, it might be a little bit higher than the Austrian one, given the Maltese tax rates. I don't think that we can expect uh that in malta there will be another tax credit in 23 because this one was related clearly to to the copy problems in regard of inflationary pressure i think we have everything included in our outlook so what can we expect we had the first round of increase with 5.6% starting from 1st of January and the negotiations for the collective agreement for the period 1st of January to 22 to 31st of March 23 uh will start in april and should be finalized the end of april beginning of may and if you take the inflation figures of this 15 month it is clearly a figure that is to a certain extent exceeding 10 so personal costs overall uh in 23 compared to 22 will increase by roughly 20 percent because we will also have given the additional traffic and business we will also have more people to a certain extent So, put it all together, the wage increases, the inflation, and also the additional headcount, we should come up with roughly 20% personal cost increase, but that is already built in in our guidance for 2023. Nobody can exactly tell you now what the tariffs will be increased for the next period. But the next period then will include the inflation rate for August to July of 22 to 23. And as we all know, this is a period with a rather high inflation rate. So this will be built into the airport charges scheme.

Does this answer your questions, Vladimir?

I would have a question. So this increase, we are talking for the period August 22, July 23, from when it will be effective, this higher inflation rate in charges?

1st of January 2024.

Okay, that's what I wanted. Okay, thank you.

It's always several months after after the Thank you.

Any further questions?

Yeah, if I may step in. Good afternoon, Jens. I mean, it's to some extent linked to the upcoming increase of the payout ratio. But if you could just remind me of your general capital allocation policy. And I mean, under certain circumstances with very high, say, tailwinds from the market, I mean, might the payout ratio go up to, say, the entire profits or full distribution of net profit?

It's too early really to give you a firm assurance in that direction because we have to have the figures then for 2023 and then we can decide but

as i said i think if if things go as well as we expect and given our capital structure it would allow us substantially to maneuver yeah because i guess you will continue to pile up cash you're already in net cash territory so um i mean what will be kind of the uh where will you deploy the funds

I mean, what in very short time could be an option is that we start, as I said before, to repay the EIB loan because there is the interest rate at 4.6% and we have to put collaterals to that. uh but it's penalized so as long as interest rates are substantially below that we would have to pay penalties to the eib but given the fact that the eib announced that two or even three rounds of of interest rate deductions lay ahead it could be the case that we can act maybe later this year. And secondly, we are now starting substantial investments, as Julian showed, the south extension and a lot of other activities. So most of it we are ready or we are in the position to finance out of cash flows. And for the rest, I think we can also distribute some value to our shareholders. All right, thank you.

Thank you, Markus. Any more questions? Independently from the analyst or investor side. Final call. If there are no more questions, may I have one additional question? Here is Vladimira speaking.

Of course, please go ahead. Question.

Did you make this accounting exercise to calculate so-called clean EBIT or EBITDA, whatever, 22 in comparison to 21, just simply deducting all positive, negative, one-offs, everything what you would characterize as one-offs to give me two comparable figures for those years?

So, roughly, I mean, that's not totally... uh worked out to the the final euro was sent roughly the one offs add up to positive roughly 16 million euros 16 million plus in 2022 yes in 2022 yeah one ops from different kinds

Okay, maybe can you elaborate? Because we have learned that there was minus 12 in the last quarter, then minus 4.5 also on this receivable impairment. So how did we get to the positive 16? What was on the positive side so big?

The biggest chunk of it is the sale of a piece of land with roughly 13 million surplus. some of the COVID support, short-term work, and these are the main positions.

May I ask you how much was the COVID support and short-term work?

No, sorry.

Okay, so net is 16 million plus in 2022.

Okay, I can give you later the details, but I have many figures in my head, but not all of them.

Okay, I understand. For me, it is good to know the starting base, in fact, for calculating year 2023 without anyone else. Absolutely.

something else of interest if not then i think it's time to conclude this call we thank you for your interest to show in our company and uh we will be Presenting traffic figures for February the week following the next one and Q1 numbers in mid-May.