Zurich retail stable but spend per head falls -3.3%
By Kevin Rozario |
First half results from Zurich Airport (ZRH) show that its retail performance has stabilised with a slight -0.6% decline in non-aviation revenue on the same period in 2015. However, this compares to a +3.4% increase in passenger traffic to 12.6m which has resulted in a fall in spend/head, continuing last year’s trend.
Non-aviation revenue reached CHF188.5m/$195.7m, of which the duty free and travel retail component – operated by Dufry and recently renewed – was down by -0.5% to CHF44.2m/$45.9m (see chart below). The effect relative to the good traffic growth was that retail and F&B revenue per departing pax fell to CHF8.20/$8.50, still affected by the high Swiss franc.
ZRH operator, Flughafen Zürich, says: “The strong Swiss franc in relation to other major currencies remains an omnipresent factor, in particular influencing airside consumer behaviour. In addition, the purchasing power of certain passenger segments, especially from the CIS states and the Far East, is influenced by local developments such as the luxury tax in China for example.
“Close cooperation with the airport’s partners is therefore all the more important in order to develop and implement appropriate strategies for increasing sales. The early extension of the duty free agreement with Dufry marks a first important milestone in this regard.
TRANSFER PAX SHOPPING AT FRANKFURT
Dufry plans to redesign all its duty-free shops at the airport in order to drive spending and provide a higher quality service. Whether that will be enough to make a difference remains to be seen given that many international transferring passengers have been opting to buy high-priced items such as luxury watches at better value Eurozone airports such as Frankfurt.
Flughafen Zürich maintains that compared to the negative trend in the Swiss bricks-and-mortar retail business, ZRH is growing – largely helped by landside development – and that “expansion and optimisation of the retail offering at Zurich Airport over recent years is now paying off”.
Overall, Flughafen Zürich reported a profit of CHF103.8m for HY1 2016 up by +15.3% on revenue of CHF480.7m, up +2.6% (see table below).
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