MAHB upbeat on plan to raise non-aeronautical revenue
Contribution target in next 5 years from operations that include food and beverage, hotel, agriculture and horticulture
MALAYSIA Airports Holdings Bhd (MAHB) is upbeat on the prospect of increasing non-aeronautical revenue contribution to the group by five per cent within next five years.
Managing director Datuk Badlisham Ghazali said currently the aeronautical and non-aeronautical segments contribute equally to the group’s revenue.
“Our goal is to increase nonaeronautical revenue to potentially 55 per cent of the group’s revenue.
“The target goes hand in hand with airport expansion plans to make it more efficient and to increase customer service,” he said recently.
MAHB’s non-aeronautical revenue throughout last year rose 10.5 per cent to RM531.1 million, driven by stronger sales registered by the concessionaires and retailers.
Its non-aeronautical segment includes duty free and non-duty free outlets, food and beverage outlets at designated airports in Malaysia, hotel operations, as well as agriculture and horticulture.
Badlisham said MAHB would also upgrade its retail commercial business at all airports, starting with Langkawi to the Kuala Lumpur International Airport (KLIA).
“This is important as the passengers’ preferences have changed the concept of spending time at the airport retailers.
“Passengers want experiential shopping in different environments and different brand categories. We want to redo it all so that we can provide better customer service and beyond for the passengers.” Badlisham also said MAHB is keen to open up available slots for better retail and commercial offerings.
“It will take about five years to hit double-digit growth per person spending from where we are today. We are going to redo commercial offerings over the next three years. We want to increase our sales per passenger. Currently, it is relatively low compared with our regional peers,” he said.
According to MAHB, passenger spending at all MAHB airports averaged RM24 per person. Spending per person at KLIA was about RM46.40 and at klia2 about RM30.
“We have to cater to all discerning passengers, but there will be more high-end brands and a bigger format. It’s not just about low-end, but also mid-end local products,” he said.
Badlisham stressed the importance for MAHB to nurture Malaysian products as well get higher per person spending, and attract local players to the airports.
He said MAHB also intended to maximise the existing asset (land) surrounding its airport networks for future development such as the KLIA Aeropolis.
“By next year, we will be ready to announce Business Park at KLIA to attract similar investments like the airport in Subang,” he added.
For the Penang International Airport, Badlisham said MAHB planned to not only add more car park space, but also look at building a hotel and premium outlet outside the airport.