Airport operator Fraport Group reports that its revenue jumped 15% in the first three months of 2018 to €681.7m ($808.5m), despite the negative impact from lower retail revenue which fell by 4.6% or €2.2m ($2.6m) to €45m ($53m) across its network of international airports.

According to the company’s results statement, ‘lower retail revenue had a reducing effect on Group revenue’.

As previously reported, Fraport USA took over operations of the food & beverage and retail units in Terminal 5 of New York’s JFK International Airport on 1 April, 2018.

The company’s Retail & Real Estate segment registered a minor increase of +0.3% €117.4m, with higher parking revenue (+€3.2m) standing in stark contrast to lower retail revenue (–€2.2m).

Net retail revenue per passenger decreased by 13.0% to €3.27 compared to the previous year (Q1 2017: €3.76) which was attributed to the devaluation of several currencies against the euro (the British pound being one), which resulted in a significant loss of purchasing power.

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PASSENGER GROWTH DILUTES SPEND

“Further influences on retail revenue were the above average growth in passenger numbers on European routes, where passengers tended to spend less,” said Fraport.

Worryingly Fraport also highlighted that capacity bottlenecks were also to blame for disappointing retail sales, “particularly at security checkpoints, which reduced the remaining time for purchases.”

At the Frankfurt Airport site, an increase in overall revenue (including aviation) was driven by higher airport charges based on passenger growth; increased income from security services due to new business at Berlin and Cologne/Bonn airports; a rise in charges from ground services and infrastructure as well as higher parking revenue.

Beyond the Frankfurt site, Fraport Greece (+€44.3m) as well as the Group companies Fortaleza and Porto Alegre (+€30.8m) ‘contributed significantly’ to revenue growth, as these operations had not been taken into account in the first quarter of the previous year.

There was a negative contribution to revenue from Group company Lima due to exchange rate effects (–€3.5m) despite a positive development in passenger volume in the reporting period.

NEW RECORD FOR FRANKFURT

Frankfurt Airport set a new record for passenger traffic in the first quarter of 2018 with 14.4m passengers. Apart from the influence of the earlier Easter holidays compared to the previous year, this growth was driven by the ‘extensive increases in offers from airlines’, says Fraport.

Above all, the additional offers strengthened continental traffic (+15.3%), mainly with new destinations as well as increases in traffic frequency to southern and southeastern Europe. A comparatively high growth rate was also achieved in intercontinental traffic (+4.9%).

“This was due to both a return of tourist traffic to North Africa as well as growth in traffic to destinations in the Far East such as China, South Korea, Thailand, and Vietnam,” added Fraport.

The airports beyond the Frankfurt site posted strong passenger growth with, in part, double-digit growth rates. In particular, passenger numbers in Antalya continued to recover significantly compared to the previous year, with traffic to and from Russia posting the strongest growth.

Only the Greek regional airports showed a slight drop in passenger numbers (–2.1%) in the reporting period. This was primarily due to the closure of the runway for renovation and expansion measures at Thessaloniki Airport, which had the strongest passenger volume.