In its 15th year of business, revenue at Hong Kong International Airport (HKIA) increased 8.1% to HK$13,134m (US$1.69bn) with retail licences and advertising revenue – which represents 38% of turnover – surging by +11.1%, to HK$4,995m (US$644m) for fiscal year ended 31 March 2013.

 

This is, however, less impressive than the 25.5% increase the airport experienced last year; perhaps an early indication of the slowdown, predicted by William Lo Chi-chung, Executive Director, Finance of AAHK [comments below].

 

This year (2012/2013) the Hong Kong Airport Authority (AAHK) recorded profit of HK$5,624m (US$725m) +5.4%, attributable to the equity shareholder, at HKIA.

 

[Above: Stanley Hui Hon-chung, Chief Executive Officer of AAHK]

 

AAHK says the 11.1% increase in retail and advertising was driven by the award of new licences, higher passenger traffic and additional spending on liquor and tobacco, fashion and jewellery, and perfumes and cosmetics by Mainland passengers.

 

INCREASED PASSENGER SPENDING

This category contributed more than half of the growth in turnover for the year. However, growth in retail licences and advertising revenue has slowed from previous years.

 

Stanley Hui Hon-chung, Chief Executive Officer of AAHK, said: “The revenue growth was largely driven by strong air traffic and increased passenger spending at retail concessions.

 

“Looking ahead, we expect air traffic and passengers spending to continue its growth momentum, resulting in healthy increase in revenue. To cope with the anticipated growth in air traffic in the medium term, 48 new aircraft parking stands in the apron and Midfield area will be commissioned in phases within the next two and a half years.”

 

A new chapter in Hong Kong’s aviation history began 15 years ago, when Hong Kong International Airport (HKIA) opened with a ceremony officiated by the then President Jiang Zemin.

 

15 YEARS IN THE MAKING

“HKIA’s operations have grown dramatically since the airport opened in 1998,” says the AAHK Chairman, Marvin Cheung Kin-tung. “Passenger volumes, flight movements and cargo throughput have more than doubled. Our destination network has increased from 120 to about 180 cities, while the number of airlines serving Hong Kong has risen from 60 to over 100.”

 

The number of airlines has grew from 60 to 108 and passenger volume increased from 28.6m to 56.5m between 1998 and 2012.

 

William Lo Chi-chung, Executive Director, Finance of AAHK, said, “We are pleased to report another strong financial year in 2012/2013. However, we expect that next year’s performance could be impacted by the stagnant economy in the Eurozone, the fragile global economic recovery and the gradual withdrawal of quantitative easing measures in the US, along with the combination of slower economic growth and liquidity concerns in mainland China’s financial sector.

 

Hui added: “The faster-than-expected traffic growth underscores the increasingly pressing need to expand HKIA. Apart from building 48 parking stands, the Midfield Concourse and its associated facilities, we are planning to add more stands to meet the airport’s future needs.

 

“We will also implement other capacity enhancement initiatives to optimise the use of existing space and facilitate the smooth movement of passengers, cargo and aircraft. We are committed to addressing our long-term challenges in the most prudent and professional manner.”