Copenhagen Airport turns a profit after busy spring

Copenhagen Airport posted a, given the circumstances, satisfactory financial results for the first six months of the year and concluded the period with an organisation fully prepared to welcome travellers during the busy summer season.

A total of 12.4 million passengers passed through the airport during the first six months of the year, a 31 per cent year-on-year increase. But still 14 per cent lower than the relevant period in 2019 before COVID-19.

The rise in activity during the spring produced a profit before tax of DKK 167 million for the second quarter. When deducting the first-quarter loss of DKK 59 million, CPH achieved a profit before tax of DKK 108 million for the first half of the year.

“Given the circumstances with a demanding restart after COVID-19, it is a satisfactory half-year result. However, the absolute level is not high enough considering the necessary investments and our inevitably rising costs” says Thomas Woldbye, CEO of Copenhagen Airport.

Revenue for the first half year ended at DKK 1,898 million, for a 22 per cent increase on the first half of 2022.

“The good news is that organisationally, CPH is back at full strength, ready and able to deliver high-quality service and performance to passengers, airlines and customers. By June, we have taken on 372 employees, and about half of them were re-hires. In other words, we were prepared for a busy summer period,” says Woldbye.

Since the low point during the COVID-19 crisis two years ago, the 800 companies operating in and around the airport have re-hired more than 3,600 employees, so today, they employ a total of about 16,500 people.

Investments for DKK 1.6 billion
In April 2023, CPH concluded negotiations with the company’s lenders for new credit facilities of DKK 7 billion, securing the refinancing due in August 2023.

In addition, a solution on the future charges that airlines pay to use the airport from 2024 onwards must be reached this year. Securing a solution will provide predictability on the business for both the airport and the airlines, as well as create a common platform for the cooperation on e.g. route development and operational efficiency.

This year, CPH expects to invest DKK 1.6 billion, primarily to develop the airside terminal area between Piers B and C with, among other things, much more space for passengers and passport control and more than doubling the baggage reclaim area in Terminal 3. Worth some DKK 5 billion, this is the airport’s largest project in recent times. The initial phases of the project are slated for completion in 2027.

“However, we’re facing the challenge that it has become much more expensive today to run and develop the airport due to increased salary costs, tightened regulatory requirements as well as interest expenses and repayment of our debt. With that in mind, we must continue to run the airport as efficiently as possible and consistently work to keep expenditures low,” Woldbye emphasises.

Green transition well under way
Work on the green transition, both at the airport and throughout the aviation industry, is also well under way, although the COVID-19 crisis was a hard blow.

“Reducing the carbon footprint is mandatory for the entire aviation industry,” Woldbye emphasises.

Achieving this goal means, among other things, the installation of even more solar panels, substantial savings of 3 per cent annually on energy and heating, investments in the electricity charging structure and replacement of petrol and diesel-driven equipment and vehicles with electrified counterparts.

In the spring, CPH was afforded the highest level of recognition in the so-called Airport Carbon Accreditation (ACA) programme for its work on reducing carbon emissions.

Route network close to being restored
As for the airlines’ routes in and out of Copenhagen Airport, work to restore the network is well under way. This summer, travellers have 177 direct routes to 52 countries to choose from. That is quite close to the numbers of 2019, when Copenhagen Airport had direct routes to 196 airports in 59 countries.

“Once again, people in both Denmark and southern Sweden have plenty of opportunities to travel from Copenhagen – and Denmark is again open to the millions of foreign tourists and business travellers who will be visiting us this year,” says Woldbye.

On average, more than seven in ten seats available are sold, and as such, the load factor is back at pre-2019 levels. On the long-haul routes out of Europe, destinations in Asia and China are still lagging, as more than half of the passengers are still not back. Traffic is busy on the route network to North America and close to being restored.

Upgraded full-year 2023 guidance
In response to the growing activity at the airport during the spring, CPH upgraded its full-year guidance in a company announcement issued on 11 July. The total number of travellers expected in 2023 was raised from more than 25 to more than 26 million.

In addition to the increase in passenger traffic, the upgrade was also based on the agreement reached between Naviair and the air traffic controllers, which has reduced the uncertainty as to the number of aircraft operations that can be carried out at Copenhagen Airport.

If passenger numbers reach 26 million passengers CPH expects a pre-tax profit in the DKK 300–350 million range. In the last year pre-COVID-19, CPH reported a profit of DKK 1.3 billion before tax.