Non-aeronautical business performed very strongly at Beijing Airport in the first half of this year ending June, with revenues reported at RMB.2,158,677,000 ($330.5m), representing an increase of 13.5% as compared with the same period in 2016.

 

This comes ahead of the new contracts BCIA has since signed with its new duty free concessionaires China Duty Free Group and Sunrise Duty Free (T3) who are understood to have agreed much-improved concession share terms in future – as compared to the previous long-term sole concessionaire arrangement with Sunrise Duty Free.

 

MAJOR CHANGES IN PROGRESS

This follows the first-ever public tender for these retail businesses, where both CDFG and Sunrise won their respective eight-year duty free contracts last June. It also follows TRBusiness’ exclusive report last March that CDFG had acquired 51% of Sunrise Duty Free (from the Boyu Capital private equity company) after operating as the long-time incumbent duty free operator at Beijing Airport.

 

Prospects for this business continue to look good in the short term, after Beijing’s concession revenues came in at RMB.1,484,879,000 ($227.4m) in the first half – equivalent to a +15.0% rise on the same period last year.

 

Within this number, concession revenues directly from traditional duty free and duty paid retailing reached RMB.721,412,000, ($110.4m), representing an increase of 22.9%.

 

RESTRICTIONS AT BEIJING…

Commenting on the prospects for the second half of this year, BCIA management said: “In the second half of 2017, facing the resources saturation, the growth in air traffic volumes of Beijing Capital Airport will continue to suffer from restriction.

 

“On the one hand, as driven by the continuous exuberant demand for travelling and optimisation of the route structure, the passenger throughput and the international aeronautical business of the Beijing Capital Airport is expected to maintain steady growth.

 

“On the other hand, the resources bottleneck and continuous high intensity operation will continue to exert pressure on the growth in aircraft movements of Beijing Capital Airport and result in the sustained trend of slight decline on the total number of flights as in the first half of the year.”

 

BCIA SAYS IT IS TIME TO SUPPORT ITS RETAILERS

Passenger numbers totalled 46.6m in the first half of this year (+2.28%) as BCIA now looks to supporting its new concessionaire partnerships going forward.

 

It says that non-aeronautical business activity in the second half of 2017 will see BCIA support the two new duty free/retail partners as it ensures the new contract is implemented.

 

BCIA said: “…the company will put much more effort into the preparation work for the turning over of the operation area and ensure the stable handover to the new operators, so as to strive for benefitting from the operation results under the new agreement terms during this year.”

 

 

SEE ALSO:

Sunrise DF sells 51% share to China Duty Free Group [https://www.trbusiness.com/regional-news/asia-pacific/sunrise-df-sells-51-share-to-china-duty-free-group/117348]

 

CDFG thanks Beijing Capital for 8-year contract win [https://www.trbusiness.com/regional-news/asia-pacific/cdfg-thanks-beijing-capital-for-8-year-contract/122882]