DAA in talks with European Investment Bank for up to €200m

Airport operator DAA is in talks with the European Investment Bank (EIB) to raise a "couple of hundred million" euro to part-fund its capital expenditure plan which extends to 2024.

At a briefing on its annual results, the company, which controls Dublin and Cork Airports, said it expected to receive additional debt funding in the next 12-24 months to help fund its €1 billion plan to increase capacity on its campus.

The EIB previously provided the DAA with €260 million to fund the terminal two project at Dublin and €200 million to develop a new pier.

The DAA’s capital investment programme runs to 2024 and includes 117 projects, such as a €570 million upgrade in developments near terminal two and €200 million on the airfield.

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It is dependent on the airport's regulator – the Commission for Aviation Regulation – maintaining, rather than reducing, the charge to airlines, according to Dalton Philips, DAA chief executive.

DAA, which has a presence in six airports around the world and controls 17 retail businesses, said turnover rose 5 per cent to €897 million in 2018 on the back of improved sales at the group’s international businesses as well as good growth in aeronautical revenue.

Profit after tax rose 6 per cent to €133 million, prompting the company to give a dividend to the State of €40 million, a 7 per cent increase on 2017.

The strong results follow a year in which passenger numbers grew to a record 31.5 million at Dublin Airport, which welcomed six new airlines and 16 new services. Cork Airport increased passenger numbers by almost 4 per cent to 2.4 million.

In advance of the peak summer season, Dublin Airport has increased passenger numbers by 7 per cent so far this year, its chief executive said at the briefing. He noted that the airport would have 23 new routes this summer, including new long-haul services to Canada, China and the United States.

Cautious note

While positive on the group’s successes, Mr Philips sounded a cautious note in relation to construction of the airport’s second runway. In particular, the company is seeking the amendment of two conditions it deems as “onerous”. These would require a significant reduction in flights between 11pm and 7am. Such a condition would mean that up to 3 million passenger journeys would be lost, said Mr Philips.

“Dublin Airport’s capacity would be almost halved during its busiest time of the day, which is between 6am and 7am,” he said.

“It has never been our intention to have lots more flights in the middle of the night, but these conditions would decimate the airport’s busiest times of the day and have a hugely negative effect on the entire Irish economy for decades to come.”

The chief executive, whose remuneration for 2018 totalled €394,830 including a basic salary of €250,000, added that the appointment of Fingal County Council as the new independent noise regulator for Dublin Airport was progressing through the Oireachtas swiftly.

Asked about the prospect of a new, third, terminal. Mr Philips said: “We don’t need new terminal facilities . . . but we need gates and apron stands.”

Elsewhere, the international arm of DAA's travel retail business recorded profits after tax of €13 million through operations in locations including North America, Europe, the Middle East and Asia-Pacific. It also holds DAA's 20 per cent stake in Düsseldorf Airport and its 11 per cent stake in Hermes Airports in Cyprus.

Traffic at the DAA-operated terminal five at the King Khalid International airport in Riyadh, Saudi Arabia, rose 13 per cent to 14.7 million.

Net debt at the company fell 18 per cent in the year to €441 million, standing at about 1.5 times earnings.