Aeronautical tariff cut nibbles at Acsa profit
State-owned Airports Company SA (Acsa) has again reported a healthy, if substantially lower, profit despite a hefty reduction in the fees the company has been permitted to charge its aeronautical customers. Income from retail rental was slightly lower at R1.185bn from R1.186bn in 2017. CEO Bongani Maseko said: “It is an area in which we would like to see an improvement.”
State-owned Airports Company SA (Acsa) has again reported a healthy, if substantially lower, profit despite a hefty reduction in the fees the company has been permitted to charge its aeronautical customers.
Acsa said on Thursday its profit for the year to end-March had fallen 58% to R843m from R2bn a year earlier. Revenue was down 20% to R6.9bn.
The performance of Acsa, which owns and operates nine airports in SA, is exceptional among state-owned enterprises, many of which have reported consistent losses and rely on state bailouts to keep operating.
A weakening economy and resulting lower traffic volumes further contributed to the decline in revenue, though a retroactive 35.5% cut in the fees it was allowed to levy under its operator’s permission was the main driver. A delay in the permission being granted meant Acsa in turn delayed infrastructure spending, which pushed up repair and maintenance costs.
The tariff reduction saw the contribution of aeronautical revenue to the total fall to 51% from 63% the previous year.
Although nonaeronautical revenue rose relatively, income from retail rental was slightly lower at R1.185bn from R1.186bn in 2017.
CEO Bongani Maseko said: “It is an area in which we would like to see an improvement.”
Aviation expert Joachim Vermooten said on Thursday that unlike most state-owned enterprises, Acsa managed to conduct its business on a commercial basis. Key risks to the business include economic regulation that had proved challenging before and from Acsa’s exposure to SAA.
“We did have some time to plan for lower tariffs, but these plans had to be firmly managed while coping with only moderate domestic passenger growth,” Maseko said.
Acting chief financial officer Dirk Kunz said losses at Acsa’s 50%-owned concession at Guarulhos International Airport in Brazil had declined by R481m from R1.017bn in 2017.
Maseko highlighted the appointment in August of a new board, though a permanent chair has not yet been found. Maseko’s term expires at the end of October.
He said he was aware of a campaign by a group of “concerned employees” to see him removed, but he was yet to see any substance to allegations against him. “That is a matter for the board. I cannot speak for them, but I welcome any further investigation,” he said.