Final Version of the Economic Sustainability PREZI @ the ICAO Air Transport Symposium - 20 April 2012

THANK YOU DEVELOP NEW REVENUE STREAMS Commercial Revenues now account for 47% of total airport revenues Olivier Jankovec, Director General ICAO Air Transport Symposium WWW.ACI-EUROPE.ORG GROW INTERNATIONALLY & ALLIANCES THE BUSINESS OF STAYING IN BUSINESS - the (European) airport perspective Capacity Traffic Determinants - Sovereign Debt Crises & GDP forecast - Fuel Price: US$123! - National Aviation Taxes - EU ETS - Airline Behaviour Forecast for Europe's Top 20 BEYOND AIRPORTS CHALLENGES Revenues under pressure & external costs rising Capital costs: Regulatory driven costs Trading Conditions Passengers: +3.9% Freight: +3.0% EUROCONTROL predicts -1.3% flights Governance & Political Interference Policy & Regulatory Framework Reflect & support business transformation & economic sustainability Business-based decisions No abusive dividend policy i) Provide LEGAL CERTAINTY - airports expansion & charges ii) Reduce OPERATING COSTS - security, safety, environment iii) Provide NEW BUSINESS OPPORTUNITIES - Liberalisation Basic Principles +23% (2010 v. 2009) CONTRIBUTION € € SOCIETY AVIATION SECTOR User pays principle, but not full costs 5 STRATEGIC DIRECTIONS YESTERDAY the way we were TODAY airports are businesses KEY DRIVERS OF THE BUSINESS EVOLUTION Airport Competition Public Financing Squeeze Shareholders' Evolving Expectations BUSINESSES - IN OUR OWN RIGHT Diversification Serving ALL customers Corporatisation (privatisation) Self-financing & Fiscal discipline No airline cross-subsidisation at the expense of airport shareholders at the forefront Mere infrastructure providers Focused on national carriers Dependent on public financing = Economic sustainability NOT in our DNA BOOST COMPETITIVE POSITION 1. 2. REDUCE DEPENDANCE FROM DOMINANT AIRLINE DEVELOP NEW REVENUES & COST DISCIPLINE 3. 4. PROVIDE CAPACITY & QUALITY 5. GROW INTERNATIONALLY & ALLIANCES BUSINESS MODELS PROFITABILITY Competitive Airport Charges Airlines related charges = 16% of airport revenues 2010 decrease: -7% / -€353 million €4 billion cost UNDER-recovery Boost Operational Efficiency A-CDM & A-CDO Airports = Ground Coordinators & Total Airport Management Diversify facilities & services & pricing Active network development Brand equity = key for effective airline competition Regional Airports Europe's Top 20 Capex 2012-2016: Redefine the airport experience Technology & Social Media Commercial revenues = of airport revenues Expanding beyond the Terminal... ...Airport City = key to economic sustainability Frankfurt Airport Paris-CDG Moscow Domededevo Athens Airport Birmingham Charleroi 1st employment site in Germany 90,000 direct jobs, 270,000 indirect jobs 29,000 direct jobs 2.14% Greek GDP 130 companies established +3% of city's workforce/ -60% unemployment €43.3 billion = Users not paying full infrastructure cost = Lower airline operating costs 48% of Europe's airports = loss making (2010) Montreal, 20 April 2012 New Airline Business Models Aviation Liberalisation = Economic sustainability 48%