Malta International Airport plc - Interim Results
On 29 July 2020, Malta International Airport plc published its interim financial statements covering the six-month period ended 30 June 2020. It is important to highlight that the performance recorded in the first half of 2020 is not comparable to the corresponding period in 2019 due to the temporary travel bans imposed by local authorities (starting from the second week of March 2020 till the end of June 2020) due to the ‘COVID-19’ pandemic.
Performance Overview
During the first half of 2020, MIA registered a 66.5% decline in revenues to €14.9 million. The sharpest drop was recorded in the ‘Airport’ segment reflecting the significant contraction in passenger movements as the airport operator welcomed almost 1.02 million passengers in the first half of 2020 compared to 3.25 million in the corresponding period in 2019. As a result, the ‘Airport’ segment only contributed €8.36 million in revenues compared to €31 million in H1 2019. Furthermore, the much lower number of passenger movements also led to a considerable drop in the ‘Retail & Property’ segment as revenues generated from this business activity fell by 51% to €6.8 million compared to €13.3 million in H1 2019.
In view of the very limited commercial activity, coupled with the number of emergency cost-cutting measures introduced by MIA during the period under review, total operating costs dropped by almost 23% to €16.9 million (H1 2019: €21.9 million). Nonetheless, given the larger drop in revenues, MIA still reported an operating loss of €2 million as the €5.01 million operating loss within the ‘Airport’ segment was only partially offset by the operating profit of €2.95 million generated by the ‘Retail & Property’ segment. Excluding depreciation charges, MIA recorded an EBITDA of €2.57 million (H1 2019: €27 million) reflecting the EBITDA of €4.55 million generated by the ‘Retail & Property’ segment which was however partly offset by the negative EBITDA of €2.04 million recorded by the ‘Airport’ segment. Meanwhile, net finance costs increased slightly to €1.04 million. While the airport operator remained debt free, the amount of lease liabilities increased to just under €53 million from €52.8 million as at the end of 2019.
Overall, MIA recorded a pre-tax loss of €2.9 million. After taking into account a tax income of €0.89 million, the loss for the period under review amounted to €2.01 million compared to a net profit of almost €14 million in the first half of 2019.
The condensed ‘Statement of Financial Position’ as at 30 June 2020 shows that total assets contracted by 1.1% to €235.4 million largely due to the considerable drop in trade and other receivables (-€10.3 million) which was partly offset by the €6.3 million increase in cash reserves to €39.5 million compared to the cash balances of €33.2 million as at 31 December 2019.
Total liabilities also eased marginally to €108.4 million mostly due to the reduction in tax liabilities. Likewise, the equity base of the company contracted by 1.6% to €127 million reflecting the loss of €2.01 million recorded during the period under review.
Outlook
In their commentary, the Directors of MIA explained that since re-opening to commercial flights on 1 July 2020, the company restored connectivity with 76 airports located in 21 European countries. Nonetheless, in view of the current extraordinary circumstances, MIA reiterated that it does not have sufficiently reliable data to enable it provide forecasts that can give accurate guidance to the market. MIA also highlighted that it is sufficiently resilient to be able to sustain the current adverse conditions and that it has sufficient resources to meet all of its financial obligations.