Polish duty free operator Baltona achieved Polish Zloty sales of PLN40.15m ($12.6m) in the first quarter of 2013 and is looking to build on that with a new contract in Poznan and an upgraded store in Lviv Airport in western Ukraine.

 

The company’s Q1 sales, amounted to a +36% increase compared to the same period in 2012, after eliminating the effect of Warsaw Chopin Airport [where the group has not operated since mid-February 2012]. However this still produced an operating loss of PLN2.985m ($937,400).

 

According to the company, which is a subsidiary of Flemingo, the results are heavily influenced by one-off events such as restructuring costs and the suspension of operations at Warsaw’s low-cost Modlin Airport due to runway repairs. Also, Baltona’s operations are characterised by high seasonality, with weaker numbers obtained in the winter season.

 

Baltona CEO Andrzej Uryga comments: “The results we obtained in the first quarter of 2013 are in line with our expectations. Observing the market and investment decisions… the turnover of Baltona will grow faster than net income.” But he adds that he expects more influence from new retail space in Montpellier, Lviv and Poznan plus the resumption of operations at Modlin Airport in Poland, where Baltona is fully operational.

 

DOUBLING SALES AT LVIV

At Lviv Airport, where Baltona originally launched just over a year ago in May 2012, the company has revamped its store to create a walk-through format covering 500sq m, with expectations of doubling turnover.

 

Baltona’s store upgrade (see images above and below) coincides with an airport expansion project that includes a new terminal with a total area of 34,000sq m and capable of handling up to 1,220 passengers per hour [10.69m passengers annually]. The new store sells products ranging from imported and local liquor to cosmetics, perfume, tobacco, accessories, watches and jewellery.

 

Lviv Airport has a number of direct European and medium haul connections including Dortmund and Munich in Germany; Vienna in Austria; Warsaw, Krakow and Wroclaw in Poland; Moscow and Surgut in Russia; Naples, Venice and Milan an Italy; Hurghada in Egypt; and Istanbul in Turkey.

 

Meanwhile Baltona has secured a contract for retail and food service at Poznań–Ławica Henryk Wieniawski Airport covering 1,900sq m. Baltona becomes the sole tenant of commercial space in the departure area for a period of four years from the time trading starts. Annually, the airport serves 1.6m people and Baltona estimates the contract will boost its revenue by between PLN200m and PLN300m.

 

Baltona has been part of the Flemingo Group since 2010 and has been listed on the Warsaw Stock Exchange since January 2013. The company is a leader in the Polish DF&TR market, operating at seven out of 13 airports and having about 40% market share.