NEWS | Wednesday, 30 April 2008

Landing charges not to move - MIA

Charlot Zahra

Malta International Airport (MIA) Chief Executive Officer (CEO) Julian Jaeger announced Thursday that the airport would not be increasing its landing charges for this year.
Addressing shareholders at the company’s Annual General Meeting (AGM) last week, Jaeger said: “The passenger service charge, the security charge and landing fees have not increased since 2006 and will not increase in 2008.
“We at MIA are committed to growth and for this reason we are investing in such incentive schemes which encourage growth by supporting new destinations and the development of more routes,” he said.
Two weeks ago, on 18 April, low-cost airline Ryanair had warned during a press conference that it would drop some services to Malta in winter and withhold further growth in the absence of lower airport costs, in view of rising oil prices.
Despite announcing carrying a record 350,000 passengers since starting operations in Malta 18 months ago, Ryanair said it was planning to axe “possibly one or two” of the existing eight routes in the leaner months if the situation prevailed.
Bridget Dowling, Ryanair’s sales and marketing manager, had said: “Further growth or the establishment of a base (in Malta) is unrealistic in the absence of lower airport costs, particularly in a market environment where continuing record oil prices threaten to make some existing routes unviable.”
However, speaking to shareholders, Jaeger said that the Ryanair routes in question fall under these incentive schemes and “since our charges have not changed since 2006 we do not see any correlation between the concerns expressed by Ryanair and our charges.”
The MIA incentive schemes for airlines offer up to 60 per cent reduction in the passenger service charge for a period of three years for new routes and up to a 40 per cent discount for underserved routes.
Jaeger, who was addressing MIA shareholders for the first time since he was appointed CEO at the beginning of January this year, said that during the last financial year, MIA had experienced the highest-ever turnover that the company has had so far at over Lm19 million and earnings before tax that have increased to Lm8.7 million.
The company registered a record net profit for the year of Lm3.8 million during FY 2007 and distributed a total net dividend of almost five Maltese cents which shows an increase compared to 4.7 Maltese cents the previous year.
Owing to the change in MIA’s financial year in 2006, whereby the company’s report reflected a curtailed period of nine months, it is not so simple to draw a comparison with the year under review.
The number of passenger movements in comparison to the calendar year 2006 increased by 10.4 per cent, which exceeds the European passenger traffic average for 2007 quoted at 6.5 per cent. Last year the seat capacity increased by 14.3 per cent over the previous year, which resulted in an increase of aircraft movements by 10.7 per cent.
Jaeger said that this significant increase, which saw MIA handling close to three million passengers was well in line with the increase of tourist arrivals reported by the Malta Tourism Authority (MTA).
The first quarter of this year showed a rather extraordinary growth of 21.3 per cent which translated into an increase of some 95,000 passenger movements, partly due to the creation of a 16 per cent increase in seat capacity.
Moreover cargo and mail activity were also on the way to recovery with an evident 8.8 per cent improvement after a difficult period in 2007. “Nevertheless we should not expect such remarkable escalation to persist throughout the year.
“Though the figures for the first quarter are most encouraging we would expect a 6.8 per cent increase at the end of this year, however we will be reviewing the situation towards mid-year,” Jaeger told MIA shareholders.
The AGM approved the Profit and Loss Account and Balance Sheet for the financial period ended 31 December 2007 and the Directors’ and Auditors’ report.
MIA shareholders also approved a net dividend of Lm0.0249 per share which represents a net payment of Lm1,684,485 as recommended by the Board of Directors.
Pursuant to the Articles of Association Malta Mediterranean Link Consortium Limited as a 40 per cent shareholder, re-appointed by letter dated 10 April 2008, Karin Zipperer and Louis St-Maurice as directors, while the Government of Malta as a 20 per cent shareholder appointed Jackie Camilleri as director for a term of three years.
Following a poll for nominations for the remaining two vacancies for non-executive directors the company received three valid nominations and an election was held at the meeting. Following the election, Michael Bianchi and Markus Klaushofer were appointed directors.

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