DAA Has Lost An Estimated €160m In Turnover Due To COVID-19 Crisis
The owner of Dublin and Cork airports, DAA, has said that the COVID-19 crisis has cost the company an estimated €160 million in lost turnover so far and will see the company record significant financial losses this year.
DAA has operations in 16 countries and the global pandemic has affected all of its businesses.
According to DAA, passenger numbers at Dublin and Cork declined 99% in April and May, and, while the two airports had enjoyed a positive start to the year in terms of traffic growth, the sharp fall in travel in recent months means that overall 2020 passenger numbers have already declined by 55% and will fall further.
Passenger numbers for Dublin and Cork Airports could be as low as nine million for this year, compared to a combined 35.5 million passengers last year, according to DAA chief executive Dalton Philips, and passenger numbers for 2021 may be approximately 21 million, which would represent a 40% decline in traffic compared to 2019.
DAA said that its overseas businesses have also felt the brunt of the collapse in international aviation, as all but one of its ARI travel retail operations have been shuttered. Domestic flights in Saudi Arabia, where DAA international operates a terminal at King Khalid International Airport (KKIA) in Riyadh, were suspended in March and only began to resume on a phased basis last week.
With almost no passengers and no shoppers in its airport retail outlets, DAA is currently losing €1 million per day, according to Philips.
Cost Cutting Measures
DAA has placed employees on a four-day week and a programme is underway to right-size the business through a voluntary severance scheme, career breaks and reduced hours working. Changes in work practices are also being introduced to keep passengers and staff safe in a post-COVID-19 environment and also to make the business more effective.
Due to the economic impact of COVID-19, DAA's board has not recommended the payment of a dividend for 2019. All capital spending is being reviewed and the delivery timescale of certain planned upgrades at Dublin Airport will be reconsidered.
DAA's results for 2019 show that its turnover increased by 4% to €935 million while its earnings before interest, taxation, depreciation and amortisation (EBITDA) increased by 4% to €302 million, its profit for the year before exceptional items increased by 13% to just over €150 million, its operating costs increased by 5% to €446 million, and its net debt was further reduced, declining by 2% to €430 million.
© 2020 Hospitality Ireland – your source for the latest industry news. Article by Dave Simpson. Click subscribe to sign up for the Hospitality Ireland print edition.