Investor Presentation FY18 Interim Results - 30 September 2017 - PowerPoint PPT Presentation

Investor Presentation FY18 Interim Results - 30 September 2017 December 2017

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Introduction Neil Thompson mpson Chief Financial Officer, MAG Andr drew ew Cowan an Chief Executive Officer, Manchester Airport 3

Contents  FY18 H H1 H Highligh ights  Passe seng nger er Growth h & Co Commerc rcial ial Developm pmen ent  Trading ding Perfor orma manc nce  Capital al Investme stment nt  Financing ncing 4

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FY18 H1 Highlights Anoth ther stron ong g half year r for MAG with strong g year on year r growth th, finan ancia cial l outperfo rform rmance ce against st budget t and contin tinued d invest stment t acros oss s the Group p to suppor port t long-te term rm growth wth Continued strong carrying 35 million passengers (+9%). MAN passenger numbers at an all-time high and more cargo processed than ever before. MAN passenger growth of 10% - 2 nd fastest growing airport in the UK. STN passenger numbers grew by 10% in the past half year with 6 6 the airport now having 8.2m more passengers than in 2013. EBITDA ahead of 5-year plan and 10% up on prior year. A new STN arrivals facility granted planning permission as part of infrastructure developments to enhance passenger experience and capacity for growth. MAN TP underway - phased and modular infrastructure investment to optimise value and manage risk. Routes continue to increase with our airports now serving 282 destinations around the world. MAG Developments continues to maximise the value of MAG’s property holdings. 45 acre plot of the Global Logistics site sold. Well positioned for continued growth – aviation pipeline, spare runway capacity, focussed MAN & STN investment. 6

FY18 H1 Financial Highlights The continuing success of MAG’s commercial and operational strategy is reflected in a 9% year on year increase in passenger senger numbe bers rs and a 10% incre reas ase in EBITD TDA EBITD TDA: £237m m (+10%) %) Group up Pax: 34.9 .9m m (+9%) %) Commercial strategy driving Strong EBITDA growth record passenger numbers ahead of plan and growth MAN Pax: : 16.6 .6m m (+10%) %) Cash genera erate ted from operations ations: : £193m m (+5%) %) MAN passengers at all time high Good cash conversion STN Pax: 14. 4.6m 6m (+10 10%) %) Capital tal Inves estm tment ent: : £129m m (+98%) %) Jet2.com now flying from STN, its first base in the Improving efficiency and South East supporting growth EMA and BOH Pax: 3.7m m Leverage: age: 2.7 .7x (-0.1 .1x) (+3%) %) Conservative financial Important dual role for leverage passengers and cargo Source: MAHL FY18 Interim Report & Accounts Note: For a reconciliation between MAHL and MAGIL FY18 Interim Results see Appendix on Page 30 7

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Commercial Growth Strategy Yielding Results The success of MAG’s commercial strategy is reflected in a 9% year -on on-ye year ar incre reas ase in passenger sengers  MAN and STN pax growing strongly. FY18 8 H1 Pass sseng engers ers (millions ons)  Benefiting from a commercial strategy that Group incentivises growth.  £1.5bn transformation projects underway to invest further in passenger facilities  Record passenger numbers.  4 awards in 2017 for Best UK Airport MAN  Planned investment programme underway  10% growth in passenger numbers in year  Primera Air and WOW Air open routes to STN the US and Canada with additional routes expected over the coming years  Secured planning for new arrivals building  EMA had it’s busiest ever summer and has invested significantly in new facilities EMA & BOH  Pax growth combined with an ever expanding cargo network EMA is well placed to drive the “Midlands Engine” Source: MAHL FY18 Interim Report & Accounts Note: For a reconciliation between MAHL and MAGIL FY18 Interim Results see Appendix on Page 30 9

Long- term Passenger Trends…Success of MAG’s Strategy The continued strong growth at MAN and STN illustrates the success of MAG’s commercial strategy and the extensive reach of the catch chment ment areas MAN...now N...now in sixth xth year ar of sustaine ustained growt wth STN…strong growth since acquisition EMA…consistent performance BOH…broadly stable but small component of MAG total Source: Management Information Note: Sep-17 figures on an LTM basis 10

A Growing and Diversified Route Network MAG continu inues s to diversify rsify its s routes and airline ine network ork and now serves ves over r 270 route tes. s. Capacity city is growi wing g togeth ther with th introduc oductio tion of new routes North Americ ica Europe pe / North Afric ica   New Thomson services from STN to New Ryanair ir and easyJe yJet rout utes from Montego Bay in ‘17 STN & MAN in Winter ’17   Addit dition ional MAN – New York BA weekend services from MAN in capacity with Thomas Cook in Summer ‘17 Summer ’17  Jet2 - commenced operations at STN  New Primera Air daily services from in 2017 with a 7-aircraft base STN to New York, Boston and serving 27 destinations. Recently Toronto to commence in April ’18 announced a further 3 aircraft to  WOW Air to commence flights to expand the number of destinations to numerous US destinations from STN 33 from Summer ‘18  via their hub in Reykjavik New Krakow w and d Naple les services from BOH  New Vueling ing and d Norwegi gian services from MAN Middl dle East Far East   Adding capacity – over 70 direct Hainan inan Airli lines launched a 4 x links ks a week from MAN during weekly service to Beijing from MAN summer in June ‘16 – increased to daily in  New MAN Oman Air commenced July ‘17  daily service to Muscat from May ‘17 Singapore Airlines now operate non-  New MAN Saudia launched new stop p to Singapo pore from MAN  service to Riyadh in June ‘17 Thomson grew its MAN long haul network with services to Phuket, Mauritius and Goa 11 Source: Management Information

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FY18 H1 EBITDA Robust st trading ing perform rmance ce acros oss s the Group. p. MAG EBITD TDA has incre reas ased d by £21m m (+10%) ) year r on year EBIT ITDA DA (£ million) on) Source: MAHL FY18 Interim Report & Accounts Note: For a reconciliation between MAHL and MAGIL FY18 Interim Results see Appendix on Page 30 13

FY18 H1 Trading Performance Group p EBITD TDA up by £21 mill llio ion (10%) ) from m £216 milli lion to £237 milli lion on – ahead of Busin iness s Plan  Continuing growth in pax at MAN and STN drives Grou oup Incom ome Statem tement nt strong aeronautical revenues  15%. Aeronautic ical l  Aeronautical yields increased 6% as airlines have revenue increased capacity and introduced new destinations including a number of long-haul routes  Pax growth drives retail revenues  13%.  Retail yield increase of 4% despite challenging Retail market conditions particularly in duty free.  Additional airside retail space opened at STN  Focus on innovation, providing more customer choice and maximising utilisation. Car Parking  Growth of 13%. Tried and tested formula for the car parking business continues to achieve results with all tastes and budgets catered for  Increase in marketing and pricing costs to support pax growth and the development of new routes. Operatin ing Costs  Investment in security and customer service to support the higher volumes.  Property strategy to realise best value from our estate results in £1.3m profit. Property develo lopment  Revenue has fallen marginally driven by the prior year disposal of STN residential properties Source: MAHL FY18 Interim Report & Accounts Note: For a reconciliation between MAHL and MAGIL FY18 Interim Results see Appendix on Page 30 14

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FY18 H1 Capital Investment Both MAG and STN have significant spare runway capacity for growth. MAG’s capital plan has continued investment in asset t base includ luding ing mainte tenan ance ce of exist sting ing assets sets and new value generating rating develop lopments ments Well invested ted asset set base se with th disc scre retio tiona nary ry spend nd based sed on need Capital tal Investm stment nt (£m) m) MAN has 2 full length runways (LHR is the only other UK airport with more than 1 such runway). STN has spare runway capacity for c.20m pax growth, and is well positioned to support London system MAN TP progressing well through design stages and construction work has commenced. Terminal construction contract awarded to Laing O’Rourke. Initial planning costs for the multi-million pound transformation programme at STN, including a purpose-built arrivals facility. Phase 1 underway with future phases in detailed design. Significant ongoing investment in IT infrastructure, back-office systems and software to enable the Group to support additional growth and manage its assets more efficiently. Runway resurfacing works at EMA supporting cargo and passenger operations – 50,000 tonnes of asphalt and 1,200 runway lights. Completed over seven consecutive weekends. Revenue diversification from low-risk investment in property estate, including Airport City. Source: Management Information 16