Malta International Airport plc - Interim Results Review

Malta International Airport plc published its interim results to 30 June 2008 following a Board of Directors’ meeting held on 17 July.

The Directors declared a net interim dividend of €0.06 per share (June 2007: €0.058). The interim dividend is payable to those shareholders as at close of trading on 28 July with the equity trading ex-dividend as from 29 July.

During the first six months of 2008, MIA’s total operating income grew by 9.3% to €20.1 million as a result of an increase in passenger departures (+14.5%), aircraft movements (+4.3%), cargo traffic (+7.1%) and mail (+3.5%).

Income from regulated fees including passenger service charge, aircraft landing and parking fees as well as security fees increased by 9% during the period under review to €14 million. This represents 69.8% of the Company’s total income. MIA’s regulated fees are expected to remain unchanged until 31 March 2009, after which the Airport Charges and Regulatory Board must devise a revised formula applicable to any changes to the regulated fees, amongst which the passenger service charge.

Revenues from retail concession outlets increased by 11% to €2.2 million. This income component now accounts for 11% of total income (June 2007: 10.8%). Income from retail concessions is expected to rise in the coming reporting periods followed the increased retail space and the agreement signed with Nuance Group Malta Ltd. The new contract comes into force in December 2008 and guarantees minimum revenue of €25.5 million for the 6-year period to December 2014.

Revenue from aviation concessions totalled €1.3 million in the first six months of 2008, a decrease of 3.8% from the previous period while recharges of expenditure and other income comprising rental income and advertising revenue increased by 18% to €2.6 million – accounting for 12% of the Company’s operating income. The main factor behind the increase in other income is the revenue generated from the running of the car park. As from 1 March 2008, Sky Parks Ltd. (a wholly owned subsidiary of MIA) took over the operation of the car park and between 1 March and 30 June generated total revenues of €0.18 million.

MIA’s operating costs increased by 5.3% to €14.2 million with staff costs rising by 5.4% to €4.4 million and other operating costs up 3.2% to €7.4 million. The depreciation charge increased by 12.7% to €2.3 million reflecting the increased investment in the extension of the air terminal and the resurfacing of the main runway. The operating profit of €6.1 million during the first half of 2008 represents a rise of 19.7% over the comparative period in 2007. Earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 18% to €8.4 million with an improvement in the EBITDA margin to 41.7% (June 2007: 38.8%). Finance costs increased by 3.5% to €1.2 million on increased borrowing to fund the various infrastructural developments undertaken. The Company’s pre-tax profit during the first half of the year increased by 26.2% to €5.1 million. After accounting for taxation, the profit for the period amounted to €3.32 million, compared to €2.6 million in the six months to 30 June 2007. The earnings per share also increased by 26% to €0.049 (June 2007: €0.039).

Total assets as at 30 June 2008 amounted to €122.8 million with shareholders’ funds at €51 million. Based on the total number of shares in issue of 67,650,000, MIA’s net asset value per share is of €0.756. The annualised post-tax return on equity (profit after tax dividend by average shareholders’ funds) is of 13.2% (June 2007: 10.6%) with annualised return on assets (pre-tax profit divided by average assets) of 8.7% (June 2007: 7.1%). On a pre-tax basis, MIA’s return on equity is 20.4%.

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