Perth Airport gains top ranking

26/04/2018 - 15:13

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Perth Airport has received the highest rating of Australia’s four biggest airports and registered a spike in profits during the past financial year, according to a report from the consumer watchdog.

Perth Airport gains top ranking
Perth Airport recorded a 10.3 per cent rise in profits.

Perth Airport has received the highest rating of Australia’s four biggest airports and registered a spike in profits during the past financial year, according to a report from the consumer watchdog.

The Australian Competition and Consumer Commission’s airport monitoring report handed Perth a ‘good’ rating for overall service quality and car parking operations, overtaking Brisbane as the top airport in the country.

ACCC chairman Rod Sims linked Perth’s strong performance to the recent completion of the airport’s $1 billion redevelopment.

“It is clear that Perth Airport’s investment program over the past few years has significantly improved the quality of the airport in the eyes of both airlines and passengers,” Mr Sims said.

The airport was rated as ‘good’ for both its international and domestic terminals, while aircraft-related services were rated as ‘good’ for the first time in the last decade.

While Perth and Brisbane airports maintained their ‘good’ rating, Melbourne and Sydney were rated at the top end of ‘satisfactory’.

Perth spent $60.7 million on aeronautical assets in the 2016-17 financial year, which was significantly lower than the previous four years.

Total aeronautical revenue grew by 5.7 per cent in real terms to $225.7 million, despite a drop in aircraft movements and passengers.

Perth recorded a 10.3 per cent rise in profits at $78.8 million, with a profit margin of about 35 per cent.

Total passenger numbers at Perth Airport fell by 1.4 per cent to 14.3 million.

This drop was driven by a 3.5 per cent decrease in domestic passengers, which more than offset the growth in international passenger numbers (3.4 per cent).

Car parking revenue fell 2.5 per cent to $63.0 million in 2016–17 and has now declined for three years in a row.

Car parking operating profit declined by 8.1 per cent to $33.0 million, which is the lowest level since 2011–12.

The four airports earned a combined $757.6 million in operating profits from aeronautical activities in 2016-17, up 9.9 per cent in real terms from the previous year. Sydney Airport alone earned $360.8 million.

“It is not surprising that the airports are so profitable, given that they face little competitive pressure and no price regulation,” Mr Sims said.

Sydney Airport earned $18.3 per passenger in aeronautical revenue (up 4.4 per cent) while revenue per passenger at Perth Airport grew by 7.2 per cent to $15.8.

“Profits per passenger have also risen at each of the four airports and travellers are paying for this through higher ticket prices,” Mr Sims said.

“We remain concerned that the current regulatory regime which is limited to monitoring the covered airports, doesn’t constrain the market power of four of Australia’s major airports. Unconstrained monopolies often have an incentive and ability to charge excessive prices while lacking strong incentives to improve services.”

 

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