Airport 'holds ground' despite passenger decline

While most airports in the Mediterranean have inevitably been affected by adverse realities on global levels, Malta International Airport has solidly held its position, said its chairman Michael Hoeferer.

Writing in the MIA Business Report and Financial Statements 2005/2006, Holding Ground, he said the company's profit levels have remained unchanged.

The profit after tax was only marginally less than that of last year, according to the directors' report. The profit on ordinary activities before taxation amounted to Lm4.89 million, while the profit after taxation amounted to Lm3.07 million compared to Lm3.22 million in the prior financial year.

The financial year April 2005 to March 2006 was particularly difficult, the report states, with a reduction of passengers throughput when compared to the previous year, as well as significant increases in operating costs.

The volume of passengers using MIA declined by 2.65 per cent over the last year but its revenue increased from Lm16.5 million to Lm16.6 mainly due to the rise in aeronautical charges applicable from April 2005.

The number of passengers decreased from 2.83 to 2.76 million due mainly to the absence of passenger traffic from the cruise business during last summer, the weak performance of the tourism industry and a reduction in travel from local residents because of the increase in taxation in air travel, the report states.

The company is still trying to encourage the use of the airport as an air cargo hub. Discussions are in hand to enlarge the cargo facility areas opened last year, and the prospects for the development of cargo and courier services in and out of Malta were looking good.

MIA was also seeking prospective investors to develop the land opposite the air terminal into a Mediterranean Business Park, which would add value to the core business of the airport, the report said.

The company's standards have risen by three percentage points over last year as registered in the AETRA Global Monitor Report - MIA has once again qualified among the top three airports in its category worldwide.

In his statement, Mr Hoeferer attributed the results to a "far-sighted and competent" management.

MIA's performance witnessed a vote of confidence with its over-subscription of the 20 per cent shares released on the Stock Market, he continued.

Out of a capital expenditure of Lm2.6 million in 2005/6, two thirds have been allocated to the Schengen project, an expansion of the air terminal in line with Malta's imminent adherence to the EU's Schengen requirements. The remaining amount dedicated to the ongoing upgrading and improvement of the existing facilities.

Major infrastructural developments on the airfield, to the tune of Lm6.5 million, are also being planned over the next three years to increase the runway capacity.

MIA is also examining energy-saving measures to withstand the increase in energy costs, Mr Hoeferer added.

In the report, CEO Peter Bolech said that MIA had managed to hold its ground, especially when considering its high dependency on tourist arrivals which in 2005 failed to significantly improve over previous years.

The company, he said, must resort to innovative measures to find solutions within the existing market realities - an exercise that required the concerted effort of all stakeholders.

MIA was determined to pursue its proactive marketing exercise, targeting also the low-cost carriers, though cautiously monitoring the continual revenue growth and any reduced impact of Air Malta's potential.

"We spare no effort to attract to Malta on the basis of a level playing field any airline bearing the necessary potential to increase increase tourism figures," Mr Bolech said.

In line with international airport trends, MIA must continue to expand its commercial activity by tapping modern business and retail facilities, directed to decrease dependency on actual aviation income, he said in the report.