Munich Sets Records

MUNICH’S ANNUAL press conference, held in February, revealed that the airport was back on a positive track in 2010.  Approximately 35 million passengers – a gain of 6% over the previous year – used the hub during the past year.  With this new record, Munich continued to hold the number seven spot among Europe’s top airports in terms of total passengers.  The growing traffic figures also boosted the business performance of the airport’s operating company FMG.  After depreciation and taxes, preliminary results show a record profit for the company of €125 million (US$170.6m).
New records are also reported for the cargo segment, where the 275,000 tons of freight turnover represent a 27% gain over 2009, topping all previous increases both in percentage and absolute terms.  Commenting on the statistics, airport CEO Dr Michael Kerkloh said: “After the global financial and economic crisis, we have begun posting substantial traffic increases much sooner than expected.”
The number of aircraft movements, at 390,000, was 1.7% below the previous year’s figure.  “This small decrease can be attributed entirely to the volcanic ash cloud and the other detrimental effects during the past year,” explained Dr Kerkloh.  The volcanic eruption in Iceland, which led to the shutdown of airspace for days, the heavy snowfall at the beginning and end of the year, and the pilot strike in February wreaked havoc on the flight timetable.  In 2010 approximately 15,000 flights had to be cancelled.  Without these unusual events, the number of take-offs and landings would have shown a 1% increase over the previous year’s total, and the passenger total would have jumped by 9%.
The increased passenger demand was dealt with, in particular by Lufthansa and its partner airlines, by using larger aircraft.  The average maximum take-off weight of the types operating in Munich increased from 68 to approximately 73 tons.  During the same period, the aircraft load factor rose to a new all-time record of nearly 74%.
The first monthly results for this year confirm this trend: in January there was a 14% rise in the number of take-offs and landings and a 20% increase in total passengers as compared with January 2010.
The long-haul traffic segment at Munich Airport showed particularly strong gains: the 5.3 million passengers on intercontinental routes represented a nearly 16% jump over the previous year’s total.  almost 20 million passengers took advantage of the wide range of European destinations offered from Munich – a 6% increase from 2009.  Traffic on flights within Germany, at 9.3 million passengers, was up slightly by just under 1%.
The booming traffic figures and the substantially higher sales in the non-aviation segment – such as the airport’s shops and restaurants – are reflected in the financial results for 2010.  Preliminary figures show a new record of €850 million (US$1.1bn) in total revenues – an 8% increase over the previous year.  Taking into account the subsidiaries, the group actually achieved total sales of €1.1 billion (US$1.5bn).  An airport statement says that an: “annual profit of €125 million [US$170m] will be utilised in full to repay the old interest on the shareholder loans, and will thus benefit the FMG shareholders, namely the state of Bavaria, the Federal Republic of Germany, and the city of Munich.  Consequently, FMG has now paid back all unpaid interest on the shareholder loans.”
Dr Kerkloh praised the successful restructuring in 2010 of FMG’s ground handling activities, calling it: “a decisive fresh beginning in the group’s business policy.”  The airport says the heavy losses in ground services resulting from the opening of the market to private handling companies in this business segment have had a serious negative impact on the group in recent years.  Dr Kerkloh added that with the ground handling business outsourced since the beginning of January to a 100% subsidiary with a competitive wage structure, these services: “again have a perspective for a successful future.  With the newly formed subsidiary AeroGround, we have set the stage for this business segment to regain its status as an asset of the FMG Group after a long period as a loss-making activity.”
Mr Kerkloh said that due to the: “pleasing traffic trend”, he is, “expecting significant gains in passenger and cargo figures, and in the number of take-offs and landings.”
To meet the long term requirements for continued traffic growth FMG says it will push forward with its expansion projects.  This year it is due to start the construction of a satellite facility for Terminal 2, which will offer additional handling capacity for 11 million passengers per year.  With the airport increasingly struggling to cope with traffic at peak periods, Dr Kerkloh sees the construction of a third runway as an urgent priority: “Munich Airport will have perspectives for long-term, sustainable growth only with the planned expansion of the runway system.”
 
Summary of Munich’s annual figures:
 
Traffic figures (2010 verses 2009)
Passenger volume
Commercial traffic                34,721,605 – 32,681,067 (+6.2 %)
Aircraft movements
Total                           389,939 – 396,805 (-1.7 %)
Cargo (in tons)
Airfreight and airmail                       286,820 t – 229,095 t (+25.2 %)
Airfreight only                       274,729 t – 215,974 t (+27.2 %)
Business Results (€m)
Preliminary 2010 against actual 2009
Total revenues                     850     790
Operating EBIT                     120*    98*
Investment income              50        26
Earning after taxes              125**  94**
Cash flow                              215     182
 
* Excluding non-recurrent effects through the provisions for ground handling
** Excluding non-recurrent effects through the provisions for ground handling and interest on shareholder loans