ADP : Aéroports de Paris: 2015 First quarter consolidated revenue

Financial release                      5 May 2015

Aéroports de Paris
Q1 2015 consolidated revenue up by 4.0%
driven by aviation and retail activities dynamism

Financial Information as of 31 March 2015^[1]:
#_ftn1:

• Paris airports passenger traffic: +2.0%
• Aviation: sustained growth of airport fees (+4.0%, to €214 million) and of ancillary fees (+14.5% to €51 million)
• Retail and services: strong growth of retail activities revenue (+8.0%, to €92 million) and Sales/PAX^{[2]:
  #_ftn2} up by 9.7% to €19.8
• Real estate: impact of the indexation of rents on CCI^{[3]:
  #_ftn3} down by 0.98% as of 1 January 2015
• International and airport developments: strong contribution of new airport design projects on ADP Ingénierie revenue (+19.8% to €15 million)
• Implementation of a new accounting management model (see appendix)^{[4]:
  #_ftn4}

Group revenue by segment^[5]:
#_ftn5:

Augustin de Romanet, Chairman and CEO of Aéroports de Paris, said:

"Group consolidated revenue growth of the first quarter is satisfactory with a good performance on almost all our activities. Traffic increase is in line with our forecasts, driven essentially by Asian, Middle-Eastern and European destinations, and was translated in particular into an increase of aviation fees. Retail activities benefitted from the combined effect of the growth of highly contributive destinations and the opening in autumn 2014 of the new shops of the central square of Hall K of Terminal 2E. Paris-Charles de Gaulle was besides ranked 5^th best airport worldwide for the quality of its retail by Skytrax^[6]:
#_ftn6. Sales per passenger of the first quarter, traditionally the highest of the year with 4^th quarter, was up 9.7% to €19.8. Moreover, our performance in quality of service was also congratulated by Skytrax ranking in which Paris-Charles de Gaulle was awarded the best improvement of the year. "

Aviation

Over the first quarter of 2015, aviation segment revenue increased by 5.8% to €398 million.

Revenue from airport fees (passenger fees, landing fees and aircraft parking fees) was up 4.0%, to €214 million, benefiting from the combined increase in tariffs (+2.95% on 1 April 2014) and the growth in passenger traffic (+2.0%).

Ancillary fees were up 14.5%, to €51 million primarily due to higher de-icing fees (+89.6%, to €9 million), as a consequence of a harsher winter in 2015. The number of de-iced aircrafts at Paris-Charles de Gaulle was multiplied by 9 compared to the first quarter of 2014.

Revenue from airport safety and security services saw an increase of 4.5%, to €119 million, reflecting the increase of security checks.

Other revenue mostly consists in re-invoicing the French Air Navigation Services Division and leasing associated with the use of terminals. It increased by 19.7%, to €13 million.

Retail and services

Over the first quarter of 2015, retail and services segment revenue increased by 2.1%, to €210 million.

The revenue from retail (rents received from shops, bars and restaurants, advertising, banking and foreign exchange activities, and car rental companies) sharply grew by 8.0%, to €92 million in the first quarter of 2015. Rents from airside shops stood at €66 million, up 8.7%, thanks to the growth in passenger traffic of highly contributive destinations and the increase in sales per passenger^[8]:
#_ftn8 (+9.7%, to €19.8).

This performance was for the most part attributable to the growth of business at duty free shops, translation of i/ the growth of traffic of highly contributive destinations, ii/ the opening over the 4^th quarter of 2014 of shops of the central square of Hall K of Terminal 2E and iii/ the positive foreign exchange effect on some currencies (the euro being at a historically low level compared to Chinese Yuan or US dollar, for instance). Duty free sales per passenger are then strongly up by 13.6% to €36.0. Moreover, duty paid sales per passenger are slightly up by 1.4% to €7.1.

Revenue from car parks decreased by 3.3 %, to €41 million.

Revenue from the provision of industrial services (electricity and water supply) increased by 3.1%, to €37 million, due to an increase in electricity sales (+4.5%, to €27 million) following a colder winter in 2015.

Rental revenue (leasing of space within terminals) decreased by 7.2%, to €34 million.

Other revenue essentially consisted of internal services and increased by 6.5%, to €6 million.

Real estate

Over the first quarter of 2015, real estate segment revenue decreased by 1.6%, to €64 million.

Internal revenue was down by 2.6%, at €13 million.

External revenue was down by 1.4%, at €51 million mainly due to the negative impact of indexation of rents on the cost of construction index on 1 January 2015 (-0.98%).

International and airport developments

 Over the first quarter of 2015, international and airport developments segment revenue was up by 12.6%, at €18 million.

ADP Ingénierie revenue increased by 19.8%, to €15 million, due to the gain of new projects compared to the first quarter of 2014, especially in Bahrein. At the end of March 2015, ADP Ingénierie contractual backlog stood at €46 million for the 2015-2019 period.

Aéroports de Paris Management revenue was down by 12.6%, at €3 million, due to the termination, as of 31 December 2014, of Algiers airport contract.

Other activities

Over the first quarter of 2015, other activities segment revenue increased by 2.7%, to €48 million.

Hub One saw its revenue grow by 2.8%, to €31 million, due to the growth of the backlog of the Telecom Division.

Hub Safe^[9]:
#_ftn9 revenue was up by 8.6%, at €17 million, mainly due to the increase of security checks linked to national security plan.

Change in passenger traffic in the first quarter of 2015

• Group stake-weighted traffic^{[10]:
  #_ftn10}:

• At the Paris airports:

Over the first quarter of 2015, Aéroports de Paris traffic grew by 2.0% with a total of 20.5 million passengers welcomed, including 14.1 million passengers in Paris-Charles de Gaulle (+2.2%) and 6.4 million in Paris-Orly (+1.6%).

Geographical breakdown is as follows: 

The number of connecting passengers increased by 2.4% and the connecting rate increased by 0.1 points to 26.1%.

Air traffic movements (158,937) were down by 0.6%.

Freight and postal activity decreased by 3.2%, with 523,581 tonnes transported.

Dividend distribution policy

At its meeting of 19 February 2015, the Board of Directors decided to propose a dividend payment of €2.44 per share for the 2014 financial year at the next Annual General Meeting, to be held on 18 May 2015. Subject to the vote of the Annual General Meeting, the ex-dividend date would be fixed to 28 May 2015 and the payment would be made on 1 June 2015. This dividend corresponds to a payout ratio of 60% of the 2014 net income attributable to the Group, unchanged since the 2013 financial year. As a reminder, the payout ratio was increased from 50% to 60% in 2013, for the 2012 financial year dividends.

Implementation of a new accounting management model

In order to simplify the readability of accounting segment performance and to optimise the allocation of internal exchanges, Aéroports de Paris implemented a new accounting management system being applied since 1 January 2015. This new accounting management model consists in:

• A presentation of the P&L by nature for all revenue and costs
• A review and a simplification of allocation for revenue and costs of transversal activities
• A review and a simplification of the allocation of overheads by segment.

This new accounting management system does not have any impact of key financial metrics.

Moreover, the other main change made was the direct offsetting of capitalised production (formerly accounted for between revenue and expenses) decreasing referring costs. In 2014, capitalised production amounted to €79 million that are now broken down in less staff expenses and other costs.

First quarter of 2014 revenue pro forma is available in the appendix of this press release.

Tariffs

As of 1 April 2015, airport and ancillary fees (excluding fees for disabled and reduced-mobility passengers) increased on average by 2.4% on a like-for-like basis.

From October 2015, the consortium made up of Aéroports de Paris, VINCI Airports and Astaldi will operate Arturo Merino Benítez Airport

The Supreme Decree awarding the concession of Santiago International Airport, Chile, was published on 21 April 2015 in the Chilean Official Gazette^{[13]:
#_ftn13}.

This publication ratifies the conclusion of the tender process  organized by the Chilean government, which was made public on February 4, 2015^{[14]:
#_ftn14}. As a result, the Nuevo Pudahuel consortium, made up of Aéroports de Paris^{[15]:
#_ftn15} (45% of the consortium), VINCI Airports (40%) and Astaldi (15%), will now implement the design phase to take on the operation of the Arturo Merino Benítez International Airport in Santiago de Chile starting October 1 2015, for a duration of 20 years.

As the new airport operator, the Nuevo Pudahuel consortium main duties are to:

• renovate the existing facilities including the refurbishment and the extension of the existing terminal
• finance, design and construct a new 175,000 m² terminal, bringing the airport's capacity up to 30 million passengers per year
• operate, for the entire duration of the concession (20 years), all infrastructures, including the existing terminal, the new terminal, car parks and future property developments.

Design and construction works will be carried out by a consortium made up of VINCI Construction Grands Projets (50%) and Astaldi (50%).

Aéroports de Paris and Select Service Partner aim to create a joint venture for the planning, operation and development of "fast food" retail outlets

Following public consultation, Aéroports de Paris has chosen Select Service Partner to help create a joint venture aimed at planning, operating and developing fast food outlets.

Through this joint venture, Aéroports de Paris plans to improve the services and facilities offered to passengers, who will benefit then from a diversified and revamped range of outlets (French bakeries, coffee shops, fast-casual, Asian and bar brands).

The new company, that should start operating on 1 February 2016, will be jointly owned by Aéroports de Paris and Select Service Partner, operating more than 30 retail outlets over a period of 9 years, particularly in Terminals 2E (hall K and hall L), 2F, Terminal 1and 3 at Paris-Charles de Gaulle Airport.

The new company will be subject to approval by the competition authorities.

A conference call will be held today, at 9.00 am, CET

  Live:
-    From France: + 33 (0)1 70 77 09 41

-    From other countries: + 44 (0) 203 367 9453

  A replay of the call will be available from 12:00 pm (CET) by dialling:
-    From France: + 33 (0)1 72 00 15 00
-    From other countries: + 44 (0) 203 367 9460
-    Pin code: 293 624 #
  Presentation is available on the website: www.aeroportsdeparis.fr:
http://www.aeroportsdeparis.fr

Calendar

• April 2015 traffic figures: 12 May 2015
• 2015 Half Year results: 29 July 2015 (after stock market exchange closing)

Investor Relations

Vincent Bouchery / Aurélie Cohen: +33 1 43 35 70 58 -invest@adp.fr:
mailto:invest@adp.fr

Press

Elise Hermant: +33 1 43 35 70 70

Website: www.aeroportsdeparis.fr:
http://www.aeroportsdeparis.fr

Appendix

First quarter 2014 pro forma revenue

In order to simplify the readability of accounting segment performance and to optimise the allocation of internal exchanges, Aéroports de Paris implemented a new accounting management system being applied since 1 January 2015. This new accounting management model consists in:

• A presentation of the P&L by nature for all revenue and costs
• A review and a simplification of allocation for revenue and costs of transversal activities
• A review and a simplification of the allocation of overheads by segment.

This new accounting management system does not have any impact of key financial metrics.

Moreover, the other main change made was the direct offsetting of capitalised production (formerly accounted for between revenue and expenses) decreasing referring costs. In 2014, capitalised production amounted to €79 million that are now broken down in less staff expenses and other costs.

In order to allow the comparison with former published statements, pro forma accounts have been made. The impact over the first quarter of 2014 is the following:

The impact on Retail and Services segment is detailed as follow: