SYDNEY, Brisbane and Perth airports were able to turn a profit last financial year despite the catastrophic downturn in traveller volumes, the Australian Competition and Consumer Commission’s (ACCC) Airport Monitoring Report has revealed.
ACCC Commissioner Anna Brakey said the “surprising” result demonstrated the resilience of the airports, despite profitability margins falling sharply across the board on pre-pandemic levels.
The trio of airports had a combined operating profit in 2020-21 that was around 5% of what it was in the last full financial year before the pandemic, with Sydney Airport falling by $483 million alone to $148.46 million.
Reporting showed that Brisbane Airport fell from $329 million to $48.1 million, while Perth Airport saw its operating profits plummet to $26.8 million from $128.43 million posted during the 2019/2020 period.
Melbourne was the only major airport that failed to recover to profitability, moving from a $338.94 million profit in 2019 to a $106.82 loss in the latest period, driven by Victoria’s longer periods of COVID travel restrictions.
Meanwhile the consumer watchdog’s report also cited concerns expressed by commercial operators that airports may attempt to recover operating losses from tenants in the future by deploying a “take-it-or-exit” negotiating position.
“These commercial operators indicated that such actions would increase their costs and would ultimately flow through to end-consumers through higher price,” the ACCC’s study noted.
Hire car operators at the four big airports also indicated that revenues were between about 10-50% of pre-pandemic levels, with some forced to close booths or sell part of their fleets to generate enough cash flow.
The ACCC added it would be monitoring airports’ profit margins as they have regional monopolies and substantial market power in affecting other stakeholders in the travel sector.