Avolta is advancing on a strong performance in 2023, with the business combination (with Autogrill) contributing to a ‘ transformative and successful’ year  that saw the travel experience player emerge more resilient and diversified.

The company’s Full-Year 2023 financial summary, released today (7 March 2024), shows February year-to-date net sales growth estimated at 7% year-on-year (CER, proforma) and FY 2023 consolidated turnover reaching CHF12,789.5 million.

CORE turnover* came in at CHF12,534.6 million (up 16% compared to 2022 proforma) with CORE organic growth of 21.6%**.

New concessions (net) contributed positively at 1.4% while currency translation (mainly related to depreciation of USD, EUR and GBP against the Swiss Franc) was a 5.6% headwind.

The category split is described as ‘very balanced’ with duty free accounting for 37% of CORE turnover, duty paid 31% and F&B 32%, while the airport channel, at 82%, represented the lion’s share of the organisation’s 2023 CORE turnover.

Q4 2023 CORE turnover reached CHF3,151.3 million, with 13.1% organic growth.

All regions contributed positively, reflecting continued momentum across the quarter driven by solid leisure demand.

In a live webcast, CEO Xavier Rossinyol described the key to success as “offering what the passengers really want” and how having retail and F&B combined is helping the travel experience player to deliver on this vision.

The Avolta chief spoke more about the customer centric approach the company is taking in “making travellers happier” and how this is helping to future-proof the business.

He went on to describe the commercial initiatives driving productivity and SSP.

This encompasses: flexibility (in terms of ensuring space adaptability and scalability with new concepts, a changing assortment and ‘shop pods’); utilising digital and generative AI; entertainment (to ‘slow down’ passengers by creating fun opportunities for entertainment through gamification and digital activations) and innovation (hybrid concepts and smart stores).

He highlighted how AI can supercharge the extracting of intelligence from data to help improve commercial performance – an exciting development considering Avolta’s customer digital engagement has doubled year over year.

All of this, said Rossinyol, is to “show the landlords we are a different operation to the others and also to attract brands in a different way”.

“Of course, all that needs to be reflected in financial performance,” he added.

APAC delivers 84.4% organic growth

Although EMEA delivered the biggest share of business (51%), the region seeing the highest organic growth in 2023 (vs 2022 proforma) was Asia Pacific (APAC) at 84.4%, primarily due to the strong recovery of Chinese traffic (although this is still below 2019 levels).

During Q4 2023, Avolta boosted the company’s footprint in India with a new contract in Hyderabad, India.

The APAC team also opened new or refreshed stores during the quarter, including an array of new retail and F&B stores at Bangalore International Airport, as well as a Diptyque boutique and Crystal Jade restaurant in Shanghai Hongqiao Airport (China), F&B stores Open House, The Loaf, Ahh Yum and Tealive in Kuala Lumpur, Malaysia, and Schnitz in the Gold Coast, Australia.

Bringing hybrid concepts to the fore

Form a macro perspective, Rossinyol hailed 2023 a “very successful year for Avolta”.

“The company completed a transformational business combination redefining the global travel retail and food & beverage industry,” he explained.

“This success is further reflected in Avolta delivering CHF 30 million of synergies, which are set to increase to CHF 85 million in 2024.

“With the launch of Avolta, the successful opening of our first hybrid stores and early signs of innovation initiatives, we have set the course for continued profitable growth and are driving the travel experience revolution.

“Throughout our transformation, our focus on consistent growth and cash generation remained resolute. Further enhancing our geographical diversification, Avolta achieved particular success this year in strengthening our footprint around the world.

“Highlights include the significant renewal of the vast majority of Avolta’s Spanish airport contracts for 12 years, our 15-year contract extension at Harry Reid International Airport in Las Vegas, alongside many other activities across Europe, Middle East, Asia Pacific, Latin America and North America.”

Avolta met all its financial targets in 2023, laying the foundations for ‘sustainable, profitable growth’ moving forward.

“Looking ahead, the robust long-term global passenger outlook (4.3%5 CAGR 2023-2042) – is also seen in January and February – and is testimony to our enhanced market position to deliver profitable growth in 2024 and beyond,” said Rossinyol.

“This, coupled with our strategic initiatives for passenger conversion, increased spend per head, and our strengthened diversification across geographies and business lines, bolsters our confidence to deliver in our strategic direction and our financial outlook.”

Avolta remains optimistic on its outlook while remaining vigilant with regards to the geopolitical environment and the broader economic backdrop.

More key highlights of the results include a CORE EBITDA margin of 9%, ‘significantly exceeding’ the target.

Avolta posted an operating profit of CHF865.1 million and a net profit of CHF216.4 million.

CORE EBITDA increased to CHF1,129.6 million in 2023 with a margin of 9% (compared to 8.7% 2022 proforma), driven by continued cost efficiency and synergies arising from the integration of Autogrill and despite CHF25 million of integration costs.

*Excluding net sales from motorway fuel business.
**Refers to combined Organic Growth (proforma) versus 2022, assuming 11 months contribution of Autogrill from February 2022 onwards for the comparable period. Across this release, all growth comparisons refer to 2022 combined proforma comparable period.
*** Proforma assuming 11 months contribution of Autogrill from February onwards for the comparable period.
For further details, view the FY2023 result son the Avolta website.

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