Fraport’s H1 21 performance was largely driven by one-offs, but the group’s structural improvement was visible through positive EBITDA contribution from all its airports. The group currently sees a positive trend in the traffic, especially in Russia and China where the Q2 traffic was almost at the level of 2019. However, the group’s operational improvement is overshadowed by low FCF due to severance payments and high capex.
Companies: Fraport AG
Fraport released its Q1 results which were above market expectations. It managed to keep its EBITDA in positive territory. Traffic on its assets continued to be under pressure except in China and Russia. Its restructuring programme is almost complete and the €250m p.a. savings may kick in from 2022. Fraport is in talks with government authorities about some relief and the ~€160m aid from the German government (almost finalised) could significantly boost EBITDA this year.
Fraport has announced FY20 results which were better than our expectations mainly due to higher cost savings, but it has provided a conservative outlook for FY21. Due to the ongoing expansion projects that cannot be entirely delayed, Fraport saw capex of €1.1bn which is expected to remain at this high level at least until 2024 (until the termination of Frankfurt T3’s construction work). The group has not proposed any dividend for FY20.
Traffic at its international airports improved significantly better than at Frankfurt airport, yet the 9M revenue is down by 54%. Provisions of €280m dragged down EBITDA significantly, which in turn brought down net income to €-515m. Fraport has sufficient cost-saving initiatives in place and liquidity to survive the pandemic.
Following today’s result, we will revise our earnings downwards, resulting in a slight drop in the target price.
Fraport has announced H1 results which were better than consensus expectations. Management expects significant traffic reduction going forward, with traffic still remaining 15-20% below the 2019 level by 2022. Hence, it has announced various opex- and capex-reducing measures to adjust to the new outlook.
Fraport released its Q1 results with profits in the negative domain for the first time in a decade. As expected, traffic in April was down by 97%. The company has taken major steps to reduce expenses and has limited the cash burn to ~€150m/month which makes the group capable enough to survive for more than a year based on its current revenues, current financial position and without any government aid.
Before COVID-19 started to spread, management expected the passenger number in Frankfurt to remain unchanged but rising numbers (mid single-digits) at the Brazilian and Greek airports as well as in Lima. This picture has changed and it now sees a considerably negative impact from the virus. It sees a negative EBITDA impact of €10-14 for every passenger lost in Frankfurt. Assuming the passenger number will fall by 10% (or c. 7m), Aviation EBITDA will be down by €70-98m).
February was a catastrophe for Xi’an where Fraport holds a 24.5% minority stake. The passenger number there fell by 88% to 464k. Now that the USA is prohibiting passengers from Europe (excluding the UK) to enter its shores for one month, this will take its toll from now on, hopefully for only one month.
COVID-19 has a much harsher impact on ticket demand than anticipated only one or two weeks ago. Management has now decided, as demand to almost all destinations has collapsed, to reduce the number of flights by up to 50% in the coming weeks. This will obviously also have an impact on Fraport’s passenger number, at least in Frankfurt.
At a glance, the number of passengers in Frankfurt and most of Fraport’s other airports have not been under pressure, with the exception of Xi’an. Frankfurt’s cargo volume fell by 8.6% to 149k as worldtrade continues to be under pressure.
While the passenger number continued rising through to October 2019, it fell in both of the last two months. Simultaneously, the cargo volume fell throughout the entire year and the rate of decline accelerated as of late. This has also taken its toll on the number of flight movements and the maximum take-off weight (MTOW).
Frankfurt Rhein-Main had shown positive growth in each of this year’s months, except for November. The number fell to 5.07m in the last month which brought the ytd number to 65.7m, an increase of 1.7%. Our current projections are based on an increase of 2.0%, which seems too optimistic.
Frankfurt Rhein-Main is one important profit contributor to Fraport’s consolidated accounts and External Services is the other. In fact, Fraport’s stakes in Lima, Greek and Brazilian airports are contributing even higher earnings than the Aviation division. However, one has to include Retail & Properties as well.
The growth rate in passenger numbers moderated somewhat from H1 to Q3 at nearly all of Fraport’s airports and so have revenue and profits. However, we had anticipated this trend and the group’s final 9M profit numbers surpassed our projections.
Passenger growth has continued moderating in Frankfurt, primarily on domestic destinations. In addition, Fraport’s other full-consolidated airports in both Greece and Brazil experienced falls while Lima did well in September. On the other hand, Antalya achieved very strong volume growth indeed.
Research Tree provides access to ongoing research coverage, media content and regulatory news on Fraport AG.
We currently have 0 research reports from 0
The forthcoming UN Climate Change Conference (known as COP26) should result in an acceleration of governments’ actions to reduce CO2 emissions. This will result in an acceleration of customer end-user adoption rates which would be positive for AFC Energy which is developing zero-emission solutions for the EV-charging, construction, data centre and marine markets.
Companies: AFC Energy plc
Companies: SigmaRoc Plc
Longspur Research and Radnor Capital Partners have launched the Active Net Zero Clean Energy Index to allow investors to measure the performance of companies actively enabling climate solutions.The key emphasis is on the word “active”. This pan-European index eliminates greenwashing by penalising fossil fuel activities and focuses on actual achievement and positive contribution, rather than promises for the future. Our proprietary selection methodology is systematic, rules based and quantifiable
Companies: DRX ITM PHE SAE SIT STRLNG VLS
We see the UK Government’s Net Zero Strategy as being overall helpful but not especially definitive. Amongst our coverage group, Drax Group (DRX LN) and Velocys (VLS LN) benefit from the Humberside CCS cluster prioritisation and Velocys from SAF support. The amount of renewables is likely to boost the need for flexibility solutions where Drax, Gore Street (GSF LN) and SIMEC Atlantis (SAE LN) can benefit. Hydrogen companies ITM (ITM LN) and Powerhouse Energy (PHE LN) are likely to find support. T
Companies: ADN DRX GSF ITM NESF PHE SAE SIT STRLNG TLG VLS
Brent crude topped $85 a barrel in London for the first time since 2018, the latest milestone in a global energy crisis that has seen prices soar.
West Texas Intermediate for November settlement rose 97 cents to settle at $82.28 a barrel in New York.
Brent for December delivery added 86 cents to settle at $84.86 a barrel.
The global benchmark rose above the key level in intraday trading but did not settle above it on Friday. US crude futures posted an eighth straight weekly
Companies: FO 88E DEC EME GTC TRIN UOG WEN
The group continues to experience strong underlying market conditions, with some supply chain shortages and transport constraints causing price rises. These issues are not expected to improve in the short term, but the group is confident of progress and results are anticipated to be in line with expectations. No change to forecasts. We retain our price target of 315p, which still offers good upside despite the strong outperformance by the shares over the year. The shares remain attractive on a s
Companies: Alumasc Group plc
Tungsten West (TUN.L) has joined AIM. Tungsten West is the 100% owner and operator of the historical Hemerdon tungsten and tin mine located near Plymouth in southern Devon. Hemerdon represents the world's third largest tungsten mineral resource, with a JORC (2012) compliant Mineral Resource Estimate of approximately 325Mt at 0.12 WO3. Capital raised on Admission: £39m. Anticipated Mkt Cap: £106.2m.
Future Metals NL (ASX:FME, FME.L) (formerly named Red Emperor Resources NL) had joined AIM
Companies: SOLI RBD ALU ATQT BBI CWR DRV ORCP WATR
No Joiners Today
No Leavers Today
What’s cooking in the IPO kitchen?
Arrow Exploration Corp. (AIM: AXL ; TSXV: AXL) , the oil and gas exploration and production company, has conditionally raised approximately £8.8m and is due to complete its dual listing on AIM on 25 Oct. Market cap c£13.1m.
Devolver Digital to join AIM, an award-winning digital video games publisher and developer in the indie games space. Recently awarded indie 'Publisher of the Year 2021' by GamesIndustry.biz.
Companies: ZYT CIC DMTR GILD LMS MMAG PYC SMRT SBI
ITM yesterday announced a capital raise of £250m to expand its capacities significantly. This comes sooner than we expected and seems like an opportunistic move to capture the market. The company will use the proceeds to expand its capacities to 2.5GW from 1GW by 2023 and to 5GW by 2024. The remainder of the proceeds will be used to reduce H2 production costs and to build an unparalleled support service. Overall, we are positively surprised.
Companies: ITM Power PLC
Companies: DeepMatter Group Plc
SIMEC Atlantis Energy have raised £2.6m at a share price of 2.5p in a fresh equity raise, representing 16% of the enlarged share capital.
Companies: SIMEC Atlantis Energy Ltd.
eEnergy’s FY’21 results confirm a transformational year. Organic revenue growth was 75% and four acquisitions have now been secured, including last month’s UtilityTeam deal. There are no surprises in the numbers and the outlook statement reiterates current year expectations. Energy market volatility increases the imperative for businesses to reduce consumption, eliminate waste and tighten risk management. This should present opportunities for eEnergy as it helps its clients navigate market uncer
Companies: eEnergy Group PLC
*A corporate client of Hybridan LLP
No joiners today.
Conduity Capital has left AIM.
What’s cooking in the IPO kitchen?
Softline the global solutions and services provider in digital transformation and cybersecurity, with its headquarters in London, is considering proceeding with a potential initial public offering of global depositary receipts representing its ordinary shares. The Company is considering applying for admission of the GDRs to the standard listing segm
Companies: SEN SEMP DNORD DNORD FAB MAST SAR CZA MRL
No Joiners Today.
Cambria Autos has left the AIM following a takeover.
What’s cooking in the IPO kitchen?
Light Science Tech Holdings, the controlled environment agriculture technology and contract electronics manufacturing Group to join AIM. Raising £5m. Expected mkt cap £17.4m. Due 15 Oct.
Harmony Energy Income Trust to join the Specialist Fund Segment of the Main Market raising up to £230m. The Company's investment objective is to provide investors with an attractive and susta
Companies: VRS ORPH SNG MRL EBQ AVG