group interim report 9m2014 / 9m2014 konzern-zwischenbericht

Analyst Presentation 9M 2014 November 6, 2014 Dr Stefan Schulte, CEO Dr Matthias Zieschang, CFO

Analyst Presentation 9M 2014

This document has been prepared by Fraport solely for use in this presentation. The information contained in this document has not been independently verified. No representation or warranty – whether express or implied – is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained therein. Neither the company nor any of its affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss arising from any use of this document or its content or otherwise arising in connection with this document. This document does not constitute an offer or invitation to purchase or subscribe for any shares and neither this document nor any part of it shall form the basis of, or be relied upon in connection with, any contract or commitment whatsoever. This document contains forward-looking statements that are based on current estimates and assumptions made by the management of Fraport to the best of its knowledge. Such forward-looking statements are subject to risks and uncertainties, the non-occurrence or occurrence of which could cause the actual results – including the financial condition and profitability of Fraport – to differ materially from or be more negative than those expressed or implied by such forward-looking statements. This also applies to the forward looking estimates and forecasts derived from third-party studies. Consequently, neither the company nor its management can give any assurance regarding the future accuracy of the opinions set forth in this document or the actual occurrence of the predicted developments. By accepting this document, you agree with the foregoing.

Disclaimer


Agenda

Financial Highlights

Update on Acquisitions

Traffic Insight

Terminal 3

Outlook 2014

Financials 9M 2014


Financial Highlights Figures Fraport Group 9M 2014

Revenue

EBITDA

Group result*

Free Cash Flow

1,797

621

220

204

1,801

584

216

41

-0.2%

+6.4%

+1.7%

>100%

• Revenue decrease by 0.2%, adjusted by IFRIC12: +2.3% • Group-EBITDA +6.4% reasons: Aviation, GH and External business • Retail business remains under pressure • EBIT up due to almost stable depreciation and growing top line • Group result only slight improvement of 1.7% • Strong performance of Free Cash Flow

9M 2014 9M 2013 yoy

€ mil

€ mil

€ mil

€ mil

EBIT 396 367 +7.8% € mil

-excl. IFRIC 12 +2.3% 1,749 1,789


Agenda



Traffic Insight

Terminal 3

Outlook 2014

Financials 9M 2014


Update on Acquisitions Greece, Ljubljana & AIRMALL

Greek Airports

Ljubljana Airport

AIRMALL USA

− Airport privatization of regional airports in clusters

− Fraport bid together with Coupelouzos

− 3 bidders in particular announced by Hellenic Public Development Fund

− Decision is expected within November

− No further details

− Successful bid in August 2014

− Closing in October 2014

− Remaining shares takeover in process

− No further financial details during takeover process

− Acquired in August 2014

− Retail Master Concessions in USA

− Financials 9M 2014: Revenue:

€8.4 mil. EBITDA €1.9 mil. EBIT €0.8 mil.

Consolidation starting

August 2014

Consolidation starting

October 2014

Closing not before end of

2015


Agenda



Traffic Insight

Terminal 3

Outlook 2014

Financials 9M 2014


Traffic Insight Frankfurt Airport

Passengers*

Movements

MTOW

Cargo**

58,037

472,692

28,416

2,095

September 2014 YTD 2014

45,635

357,016

21,878

1,575

5,878

42,452

2,617

176

+5.9

-0,2

+2.5

-0.1

+3.2

-0.1

+2.2

+2.1

∆ % ∆ %

in `000

in `000 tons

60%

65%

70%

75%

80%

85%

90%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Seat load factor

2014 2013

FY 2013

in `000 tons

Passenger per movement

135 140 145 150 155

Passenger guidance FY2014: 2-3% upside

+5.6%

Sep 2014

Sep 2013

* Source ACI, commercial traffic only ** Freight & Mail


Traffic Insight Frankfurt Airport Traffic Shares 9M2014

Frankfurt Airport North America

14%

+2% ∆

Latin America

3%

-4% ∆

Africa

4%

-6% ∆

Middle East

5%

+3% ∆

Far East

11%

-1% ∆

Western Europe

43%

+6% ∆

Domestic

11%

+3% ∆

Eastern Europe

9%

+7% ∆

Continental

63%

+6% ∆

Intercontinental

37%

-1% ∆ Traffic Share

∆ Delta absolute vs. previous year in %

Traffic Insight FRA Passenger Growth in Airport Context*

Analyst Presentation 9M 2014 *Source ADV and www

3.2

2.9 2.5

1.5

0

1

2

3

4

FRA AMS CDG LHR

− FRA does well in European context despite strikes

− AMS about the same

− CDG also facing strong strike impact

− Heathrow falling behind

− FRA ahead of German average growth

− MUC weaker than FRA in 2014

− DUS in line with FRA

Growth rates passengers 9M2014 in %

Slide 10

3.2

2.9 2.4

3.3

0

1

2

3

4

GER FRA MUC DUS


IATA Code

Airport

Share

Sept 2014

∆ previous

year

YTD 2014

∆ previous

year

FY

2013

CAGR 2010-2013

FRA Frankfurt, Germany 100% 5,878 +5.9% 45,635 +3.2% 58,037 +3.1%

LIM Lima, Peru 70% 1,342 +7.2% 11,594 +4.9% 14,913 +13.2%

BOJ Burgas, Bulgaria 60% 331 -6.8% 2,477 +1.8% 2,480 +9.4%

VAR Varna, Bulgaria 60% 184 -1.1% 1,287 +4.8% 1,319 +2.4%

AYT Antalya, Turkey 51% 3,660 -2.6% 23,387 +5.9% 26,716 +6.5%

LED St. Petersburg, Russia 35.5% 1,405 +9.9% 11,280 +12.2% 12,854 +15.0%

HAJ Hanover, Germany 30% 587 +4.8% 4,017 -0.2% 5,235 +1.1%

XIY Xi‘an, China 24.5% 2,581 +11.2% 21,840 10.4% 26,046 +13.1%

Traffic Insight Group Traffic Figures (above 10% stake)

Traffic Insight Antalya with good Traffic in 2014, but Russia weakening


Slide 12

18.3

20.7 20.7 22.1 23.4

10

12

14

16

18

20

22

24

26

2010 2011 2012 2013 2014

Passengers 9M in mil

CAGR 2010-2014

6.3%

33%

25%

30%

Russia

Germany

UK

Sweden

Ukraine

Belgium

Other

− Very good traffic development in Antalya, both in 2014 and in recent years

− Russian share with +13% upside in 9M2014, Germany only +3%

− Russia weakening since September 2014 (-8% in Sep 14 vs.13)

− Outlook 2015: growth in Russian traffic challenging

Influence of Russian Traffic

2-4% each

Share of international passengers 9M2014

Traffic Insight Winter Flight Schedule 2014 / 2015


Slide 13

Plus 2.2% seat offering upside - Intercont stronger with +3% LUFTHANSA movements decreasing due to SCORE program LUFTHANSA seat offering still increasing due to aircraft size Other airlines with increase in movements and seats

(e.g. Air China upgrading to B747-8 from B777, Air Europe with larger aircraft, Qatar with A350 in 2015)

New Airlines from summer schedule continuing (like China Southern)


Agenda



Traffic Insight

Terminal 3

Outlook 2014

Financials 9M 2014

> 60

> 65

> 70

> 75

> 80

58

> 60 > 65

> 70

> 75

> 80

45.0

50.0

55.0

60.0

65.0

70.0

75.0

80.0

85.0

90.0

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Terminal 3 Traffic Forecast of Passengers FRA until 2030

Slide 15


64 mil. Passengers per year (dedicated capacity)

68 mil. Passengers per year (temporary overload)

Capacity T1+T2

Hall C und CD-Pier (2007)

Pier A-Plus (2012)

Year

Passengers per year in mil.

Forecast MKmetric

Forecast Intraplan

Capacity restriction

Terminal 3 Facts

Slide 16


− Terminal capacities restricted from 2016/18 depending on traffic-growth, critical at the latest from 2021

− 68 million passengers possible in a temporary overload situation

− Given the restricted space in the northern airport area no construction alternatives possible on time and on budget

− Terminal 3 construction starts in 2015

− Additional dedicated capacity of 14 million to launch in winter schedule 2021

− Capex budget € 2.5 to 3.0 bn. in total − Capex peak around 2020 expected,

capex ongoing beyond inauguration − Detailed capex profile to be published

in our FY 2014 publication

Terminal 3 Impressions

Slide 17


14 million capacity – 2 piers – 35 gates


Agenda



Traffic Insight

Terminal 3

Outlook 2014

Financials 9M 2014

Outlook 2014 Outlook Confirmed!

FY2013 (restated) Outlook 2014

Passengers FRA 58 mil. Growth between 2% and 3%

Revenue €2.378 bn. Revenue growth up to ~€2.45 bn.

EBITDA €733.3 mil. Between ~€780 and ~€800 mil.

EBIT €439.0 mil. Growth up to ~€500 mil.

Group Result* €235.7 mil. Slightly above 2013 level

Dividend proposal €1.25 per share At least stable

Analyst Presentation 9M 2014 *Group Result before minorities


Agenda



Traffic Insight

Terminal 3

Outlook 2014

Financials 9M 2014

Group P&L 9M 2014

Traffic Growth translated in Financials

Slide 21

€ mil. 9M 14 9M 13 %

Revenue -excl. IFRIC 12

1,797 1,789

1,801 1,749

-0.2 2.3

EBITDA 621 584 6.4 EBIT 396 367 7.8 EBT 325 307 5.7 Group result 220 216 1.7 EPS in € 2.22 2.19 1.4

34.6% 32.4% 22.0% 20.4%

0%

25%

50%

EBITDA margin +2.2PP

•Top-line affected by less IFRIC 12 income, w/o EBITDA effect

•Underlying revenue up due to traffic performance

•Positive effects also from FRA pricing

•Lower opex a.o. from mild winter

•Solid increase in EBITDA and margin

•Negative financial result from market valuation of derivatives

•Group result and EPS up

Comments

9M 2014 9M 2013 9M 2014 9M 2013

EBIT margin +1.6PP

Analyst Presentation 9M 2014 Percent change based on unrounded figures

Group P&L 9M 2014

Good EBITDA Performance

Slide 22

EBITDA 9M 2013

Other revenue

Organic cost of materials

Personnel expenses

EBITDA 9M 2014

Organic revenue

Other opex

584 +20 -26

621 € mil.

+€37 mil.

-44

+44

IFRIC 12 revenue

IFRIC 12 cost of

materials

+40 +2 +2

30.8%

45.3%

4.5%

19.4% Aviation

Retail & Real Estate

External Activities & Services

Segment share in Group EBITDA 9M 2013

31.8%

42.5%

5.7%

20.0% Aviation

Retail & Real Estate

External Activities & Services

Segment share in Group EBITDA 9M 2014

Ground Handling

Ground Handling

Analyst Presentation 9M 2014 Due to roundings differences can occur, when summing up to Group EBITDA.

• Less interest income due to lower rates • Interest expenses flat on PY • At equity result key drivers:

• Good Antalya performance • No impact from negative Pulkovo result in

Fraport P&L as book value is 0 • Other result down due to market valuation of

derivatives

Group P&L 9M 2014

Group result up, despite Taxes & Financial result

Slide 23

Group result 9M 2013

EBITDA D&A Financial result

Taxes Group result 9M 2014

216 +37

-11 220 -9

-14

€ mil. +€4 mil.

€2.22 €2.19

EPS 9M 2013

EPS 9M 2014

+€0.03

€ mil 9M 14 9M 13 %

Interest income 27 34 -20.1

Interest expenses -135 -136 -0.7

At equity result 45 34 33.2

Other result -8 8 -

Financial result -71 -60 -

Split of financial result Comments

Analyst Presentation 9M 2014 Due to roundings differences can occur, when summing up to Group result.

41 204

1,368 1,170

4,239 3,998

2,871 2,828 3,117 3,255 97% 89%

Group Asset & Financial Situation FCF enough to cover DVD and Q3 M&A payments

Sept 30, 2014 Dec. 31, 2013

€ mil.

2 Liquidity Gross debt Net debt Equity Gearing

•Sound FCF enough to cover DVD payout, Airmall acquisiton and initial LJU payment •Main FCF driver: less capex •DVD inflow not included in FCF

•Net debt decline = result of FCF, M&A, and DVDs •Equity at €3.26 bn. •Gearing ratio below 90%

•Liquidity down to €1.17 bn, reason: debt repayments •Corresponding decline in gross debt

Outlook 2014: •FRA capex: below €300 mil. •Net debt growing slightly up to ~€3bn.

Analyst Presentation 9M 2014 1) FCF pre-dividends; grey column = 9M 2013 2) Net debt divided by equity less non-controlling interests and profit earmarked for distribution

FCF1

Group Cash Flow Statement Capex Split

€ mil.

PPE Investment property

Free cash flow

Operating cash flow

Intangible assets

Airport operating projects

Cash Flow 9M 2014

Cash Flow 9M 2013

409

204

0

100

200

300

400 371

-4

-261 -43

41 -22

-4

-186 -8 -7

•Decline in capex for airport operating projects due to lower spend for Varna & Burgas

• Investment property mainly refers to CASA


•OCF improvement reflects positive operational performance

•Less capex for PPE despite ongoing preparation for Terminal 3

Due to roundings differences can occur, when summing up to free cash flow

Segment Aviation Growing Operations

Slide 26

€ mil. 9M 14 9M 13 %

Revenue Airport charges Security serv. Other

673 558

83 33

642 530

75 37

4.9 5.3

10.8 -12.6

EBITDA 198 180 9.9 EBIT 110 94 17.3 Employees 6,070 6,239 -2.7

29.4% 28.0%

16.3% 14.6%

0%

20%

40%


9M 2014 9M 2013 9M 2014 9M 2013

EBIT margin +1.7PP

•Revenue increase due to FRA traffic & higher aviation charges as of Jan. 1, 2014

•Security rev. helped by price effects

•Tailwind in EBITDA from less costs for winter services & energy supply

•Strong EBIT increase

Comments

55.3%

16.5%

5.0% 4.6%

1.4% 12.3%

4.9%

Passenger charges

Security services Other

Revenue split 9M 2014

Landing ch.

Parking ch.

Security ch.


Emission ch.

Segment Retail & Real Estate

Poor Retail Sales dampened 9M Results

Slide 27

€ mil. 9M 14 9M 13 %

Revenue

Retail Real Estate Parking Other

335 141 133

58 3

347 145 134

57 11

-3.3 -2.7 -0.7 1.8

-72.6

EBITDA 264 265 -0.2 EBIT 202 204 -0.7 Employees 615 599 2.7

78.9% 76.3% 60.3% 58.7%

0%

30%

60%

90%


EBIT margin +1.6PP

•Dowturn in revenue due to weak performance in retail and other revenue

•Real Estate down due to lower need for utilities from mild winter

•Offsetting effects on cost side

•EBITDA and EBIT down on PY

Comments

39.8%

42.1%

17.2%

0.9%

Retail

Real Estate

Other


Parking


9M 2014 9M 2013 9M 2014 9M 2013

Segment Retail & Real Estate

Less Intercont Traffic & strong EUR show Effects

Slide 28

25 29 30 31

11 12 13 13

6 6 6 10

3.40 3.10 2.95

3.95 3.74 3.42 3.24

4.11 3.69

3.22 3.04

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

Retail revenue per Passenger

9M 2012: €3.12 9M 2013: €3.44 9M 2014: €3.27

27 31 33 33

11 13 14 13

6 8 9 11

26 29 32 33

12 14 14 13

7 7 8 11

€ mil.

Shopping

Services

Advertis.


Segment Ground Handling Operational Increase, EBIT positive

Slide 29

€ mil. 9M 14 9M 13 %

Revenue Ground Handl. Infrastructure

496 287 209

490 289 201

1.3 -0.8 4.2

EBITDA 35 26 33.3

EBIT 7 -3 >100

Employees 8,954 8,962 -0.1

7.1% 5.4%

1.5% -%

0%

5%

10%


EBIT margin +1.5PP

•Growing revenue due to infrastructure services helped by price effects

•Despite wage increase EBITDA up, reason: optimized staff mix

•EBIT increased into positive

Comments

57.8%

42.2% Ground Handling


Central Infrastructure


9M 2014 9M 2013 9M 2014 9M 2013

Segment External Activities & Services Sound underlying Operations lift up EBITDA

Slide 30

€ mil. 9M 14 9M 13 %

Revenue -excl. IFRIC 12

293 285

323 271

-9.3 5.3

EBITDA 124 113 10.0

EBIT 77 73 6.1

Employees 4,687 4,848 -3.3

42.5% 35.0%

26.3% 22.5%

0%

25%

50%


EBIT margin +3.8PP

•Ongoing growth in Lima

•Good summer season in Varna & Burgas

•Airmall consolidated as of Aug. 1

•Higher D&A from Terminal inaugurations in Varna & Burgas

Comments

53.1%

18.8%

2.9%

25.2%

Lima


Others

Twin Star


9M 2014 9M 2013 9M 2014 9M 2013

Airmall

External Activities

Lima Airport*

Slide 31

€ mil. 9M 14 9M 13 %

Revenue Airport charges Retail -excl. IFRIC 12

156 82 25

149

155 81 25

145

0.6 1.2 1.9 3.0

EBITDA Margin Underlying margin

57 36.5% 38.1%

54 34.9% 37.2%

5.4 - -

EBIT Margin Underlying margin

46 29.5% 30.8%

44 28.3% 30.2%

5.0 - -

Net result 22 19 18.6

Analyst Presentation 9M 2014 * Figures refer to IFRS accounting, not local GAAP, percent changes based on unrounded figures

External Activities

Twin Star – Varna & Burgas Airport

Slide 32

€ mil. 9M 14 9M 13 %

Revenue Airport charges Retail -excl. IFRIC 12

55 32

8 54

89 29

5 47

-38.3 11.4 75.5 14.2

EBITDA Margin Underlying margin

35 64.0% 65.4%

30 33.7% 63.9%

16.9 - -

EBIT Margin Underlying margin

27 48.5% 49.6%

25 27.5% 52.0%

9.0 - -



€ mil. 9M 14 9M 13 %

Revenue Airport charges Retail

272 155 106

264 147 105

3.3 5.0 1.1

EBITDA Margin

241 88.4%

231 87.7%

4.2 -

EBIT Margin

167 61.2%

157 59.7%

6.0 -


External Activities

Antalya Airport – Figures before Consolidation


Financial Position Maturity Profile & Cash Position

Slide 34

€ mil.


New debt conditions on average:

~ 3.6 % interest rate

~ 5.4 years maturity

Early redemption of

€ 150 mil.

Maturity of new Prom. Note Loan

of € 350 mil.

Thank you for your Attention! www.meet-ir.com

Investor Relations Team Contact Details

Fraport AG Frankfurt Airport Services Worldwide 60547 Frankfurt am Main www.meet-ir.com +49 69 690 – 74842

Stefan J. Rüter Head of Finance & Investor Relations

+49 69 690-74840 [email protected]

Svenja Ebeling Investor Relations Assistant +49 69 690-74842

[email protected]

Marc Poeschmann Manager Investor Relations


Florian Fuchs Manager Investor Relations & Financial Reporting


Tanja Nagel Manager Investor Relations & Financial Reporting


[email protected]


group interim report 9m2014 / 9m2014 konzern-zwischenbericht

Documents

analyst presentation

yoy mil mil mil mil

management of fraport

clusters fraport

cfo slide

profitability of fraport

disclaimer slide

forwardlooking statements