Duty Free and speciality performance contributes to strong SYD H1 showing

By Andrew Pentol |


Sydney Airport retail revenue rose +4% to A$184.2m in H1 2019.

Sydney Airport has reported a +4% retail revenue rise to A$184.2m ($124.9m) during the six-month period ended 30 June 2019. This was delivered by strong duty free performance and 14 new Terminal Two speciality stores delivered late last year.

Total revenue increased +3.4% compared to H1 2019 on the back of international passenger growth and solid retail performance.

The SYD retail offer comprises more than 150 tenants across 31, 300sq m and the incumbent duty free operator is Heinemann Australia. According to the airport, 93% of retail leases are underpinned by minimum guarantees.


SYD also reveals that 80% of the retail leases in Terminal 3 will expire this year and that the expansion of the Terminal 1 luxury precinct is underway and will open in the first half of 2020.

Among the commercial highlights in H1 2019 were a new Terminal 2 retail and F&B precinct with increased circulation and seating. The opening of Lego and Kaboom shops, also in Terminal 2 was another important development.

During the half-year period, SYD welcomed 21.6m passengers with international pax growing +1.9%. Overall passenger numbers, however, decreased -0.2% due to a -1.5% decrease in domestic passengers compared to the previous corresponding period in 2018. Net operating receipts rose +4.8% to $431.2m, while EBITDA increased +4.1% to $649.2m.

Last year, the airport’s retail business delivered solid performance with revenue growth of +7.2% to A$357m. The increase was driven by elevated new deals and percentage rent from existing tenants and speciality leases. Speciality also helped drive retail revenue growth in 2017.


Total revenue increased +3.4% compared to H1 2019 driven by solid retail performance.

Geoff Culbert, Sydney Airport, Chief Executive Officer commented: “Today we announce a solid result for the first half of the year, reflecting continued international passenger growth, robust retail performance and a deliberate and disciplined approach to cost control.

“International passengers grew 1.9% to 8.3m with strong passenger flows from the US, India, Vietnam and Japan. The diversity of our passenger base reinforces the resilience of this business.”

He added: “Duty free and speciality store performance was strong with a lift in advertising revenues reflecting our investment in new digital advertising. Sydney Airport is a business that continues to perform well across the cycle and this half was no exception.”

Culbert concluded: “We see ongoing opportunities for growth in our aeronautical and non-aeronautical businesses and our investment program will continue to deliver capacity and great experiences for our customers.

“Sydney Airport’s diversity of revenue streams together with disciplined cost control gives us confidence in reaffirming our full year distribution guidance of 39.0 cents per stapled security for 2019, an increase of 4.0% on last year. As always, this is subject to aviation industry shocks and material forecast changes.”


Gebr. Heinemann is the incumbent duty free operator at Sydney Airport having secured the contract in 2014.





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