Capacity starved Beijing delivers positive 2006 results

Aeronautical revenue rose 12.2% driven by an 18.7% and 10.2% rise in passenger numbers and aircraft movements, respectively, which in turn led to double-digit growth in revenue from passenger charges, aircraft charges and airport charges. In contrast, non-aeronautical revenue fell 17.6%, as a result of the franchising out of ground handling and air catering services. This also contributed to the fall in operating expenses.

In 2007, BCIA expects to maintain "steady" traffic growth, which will continue to boost revenues from related aeronautical businesses. BCIA also announced plans to continue franchising-out non-aeronautical businesses and to enhance cooperation with existing franchisees to improve their marketing and margins.

"Steady" growth is a significant understatement. The airport rocketed into ninth place worldwide, in terms of passenger throughput, in 2006, with an 18.3% increase to 48.7 million passengers. BCIA is facing a major capacity issue, operating well over facility limits, which can impact on passenger comfort levels. Currently, BCIA has capacity for 35 million passengers p/a, although it is currently undergoing a massive expansion plan, including construction of the new Terminal 3 and a new runway, which would provide capacity for 79 million passengers p/a. The project is expected to be completed by the end of 2007 in time for the Beijing 2008 Olympic Games.

But capacity for 79 million passengers may not even be enough. BCIA’s parent company also confirmed last year it is considering plans to construct a second airport in Beijing, as it forecasts passenger numbers to reach 90 million p/a within ten years.

The details:

Beijing Capital International Airport (BCIA) reported (26-Apr-07) the following financial/traffic highlights for the 12 months ended 31-Dec-06:
∑ Revenue: USD409.5 million, +2.1% year-on-year:
o Aeronautical: USD297.5 million, +12.2%;
ß Passenger charges: USD95.1 million, +11.4%;
ß Aircraft charges: USD116.3 million, +11.6%;
ß Airport charges: USD86.1 million, +14.0%;
o Non-aeronautical: USD111.9 million, -17.6%:
∑ Operating costs: USD189.5 million, -12.3%:
∑ Net profit: USD141.6 million, +20.3%;
∑ Passenger numbers: 48.7 million, +18.7%:
o Domestic: 37.5 million, +18.8%;
o International (including Hong Kong & Macau SARs): 11.1 million, +18.3%;
∑ Cargo volume: 1.0 million tonnes, +31.6%:
o Domestic: 642,817 tonnes, +21.6%;
o International: 386,092 tonnes, +52.3%;
∑ Aircraft movements: 376,643, +10.2%:
o Domestic: 288,491, +8.8%;
o International: 88,152, +15.0%.

Meanwhile, BCIA reports (15-May-07) the following traffic highlights in Apr-07:
∑ Passenger numbers: 4.7 million, +11.4% year-on-year;
o Domestic: 3.7 million, +10.5%;
o International: 1.1 million, +14.5%;
∑ Cargo volumes: 94,000 tonnes, +17.6%;
∑ Aircraft movements: 34,820, +11.2%.