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Malta International Airport p.l.c.
C 12663
Annual Financial Report andFinancial Statements
31 December 2023
Malta International Airport p.l.c.
Contents
General Information
2
Directors’ Report
3-14
Statement of Directors’ Responsibilities
15
Corporate Governance – Statement of Compliance
16-28
Remuneration Report
29-31
Income Statements and Statements of Comprehensive Income
32
Statements of Financial Position
33-34
Statements of Changes in Equity
35
Statements of Cash Flows
36-37
Notes to the Financial Statements
38-88
Independent Auditor’s Report
Malta International Airport plc
General Information
Year Ended 31 December 2023
2
Directors:Mr Nikolaus Gretzmacher (Chairman)
Mr Alan Borg (Chief Executive Officer)
Mr Karl Dandler (Chief Financial Officer)
Dr. Cory Greenland
Ms Rita Heiss
Dr. Wolfgang Koeberl
Mr Florian Nowotny
Company secretary:Dr. Louis de Gabriele LL.D.
Registered office:Malta International Airport,
Luqa,
Malta.
Tel. (+356) 2124 9600
Country of incorporation:Malta
Company registration
number:C 12663
Auditor:PricewaterhouseCoopers,
78 Mill Street,
Zone 5,
Central Business District,
Qormi, Malta.
Legal advisors:Camilleri Preziosi Advocates,
Level 2 - Valletta Buildings,
South Street,
Valletta,
Malta.
Malta International Airport plc
Directors’ Report
Year Ended 31 December 2023
3
The directors present their report together with the audited financial statements for the year ended 31 December 2023.
Principal Activities
Malta International Airport p.l.c.’s (“the Company”) principal activities are the development, operation and management of Malta International Airport, for which the Company has a 65-year concession that came into effect in July 2002.
The Company has three 100% owned operating subsidiaries: Airport Parking Limited, SkyParks Development Limited and SkyParks Business Centre Limited. Airport Parking Limited operates all car parks situated on the land leased to Malta International Airport p.l.c., whilst SkyParks Development Limited and SkyParks Business Centre Limited manage the SkyParks Business Centre building. The Company and these subsidiaries are together referred to as the Group.
Malta International Airport p.l.c. also has another 100% owned subsidiary: Kirkop PV Farm Limited, set up with the intention to explore opportunities in the generation of electricity using photovoltaic technologies. Kirkop PV Farm Limited, however, did not trade in 2023.
Review of the Business
Traffic Development
Malta International Airport closed 2023 with a record 7.8 million passenger movements, registering an increase of 33.4% in traffic over 2022. Handling an additional circa half a million passengers over 2019, this result was achieved in parallel with an upturn of 27.3% in aircraft movements and an increase of 29.1% in seat capacity. Strong seat occupancy levels were also registered throughout the year, with seat load factor reaching an all-time high overall average of 85.2%, gaining 2.7 percentage points over 2022. While each month registered varying rates of growth, the strongest upturn in traffic was achieved in the last quarter, reflecting increased travel demand in the winter months.
All markets continued to recover at different rates. The majority of our markets reached or surpassed their respective 2019 and 2022 results, with Italy, United Kingdom, Germany, France and Poland topping Malta International Airport’s market leaderboard. Whilst both the French and Polish markets registered the most significant growth, traffic from the United Kingdom and Germany performed below 2019 levels, despite registering a marked improvement over 2022, due to fewer flight connections. The Italian market also continued to perform well, retaining its spot as Malta International Airport’s top driver of traffic.
Traffic Highlights
 
 
2023
 
2022
 
+/-
% Change
Passenger Movements
 
7,803,042
 
5,851,079
 
1,951,963
33.4%
Aircraft Movements
 
51,353
 
40,355
 
10,998
27.3%
Seat Capacity
 
9,155,085
 
7,093,600
 
2,061,485
29.1%
Seat Load Factor
 
85.2%
 
82.5%
 
 
2.7 pp
MTOW (in tonnes)
 
2,011,402
 
1,564,392
 
447,010
28.6%
Cargo and Mail (in tonnes)
 
20,645
 
17,552
 
3,093
17.6%
Malta International Airport plc
Directors’ Report
Year Ended 31 December 2023
4
(continued)
 
 
Q1 2023
 
Q1 2022
% Change
Q2 2023
Q2 2022
% Change
Passenger Movements
 
1,245,525
 
672,965
85.1%
2,188,945
1,672,329
30.9%
Aircraft Movements
 
8,825
 
5,990
47.3%
14,514
11,639
24.7%
Seat Capacity
 
1,535,759
 
1,028,045
49.4%
2,586,398
2,048,569
26.3%
Seat Load Factor
 
81.1%
 
65.5%
15.6 pp
84.6%
81.6%
3.0 pp
MTOW (in tonnes)
 
348,466
 
230,583
51.1%
564,508
446,678
26.4%
Cargo and Mail (in tonnes)
 
                4,948
 
            3,716
33.2%
                  4,948
            4,145
19.4%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Q3 2023
 
Q3 2022
% Change
Q4 2023
Q4 2022
% Change
Passenger Movements
 
2,539,355
 
2,059,920
23.3%
1,829,217
1,445,865
26.5%
Aircraft Movements
 
15,691
 
12,939
21.3%
12,323
9,787
25.9%
Seat Capacity
 
2,824,635
 
2,304,195
22.6%
2,208,293
1,712,791
28.9%
Seat Load Factor
 
89.9%
 
89.4%
0.5 pp
82.8%
84.4%
(1.6 pp)
MTOW (in tonnes)
 
610,614
 
501,517
21.8%
487,814
385,614
26.5%
Cargo and Mail (in tonnes)
 
                  4,793
 
4,968
(3.5%)
                  5,956
4,722
26.1%
Operational Performance Indicators
Airports Council International’s (ACI) Airport Service Quality (ASQ) survey is the world’s leading airport passenger satisfaction program, with close to 400 participating airports in 95 countries. This globally recognized program provides airports with tools and expertise to measure and improve passenger satisfaction, business performance and airport service quality. Malta International Airport has been participating in the program since 2005 and has consistently ranked in the top 5 airports in Europe within its size category, being awarded the ’Best Airport in Europe’ title in the 5 to 15 million passenger category in 2018, 2019, 2020, 2021 and 2022.
At the start of 2022, the ASQ Departures Questionnaire was improved to better reflect airport guests’ satisfaction in relation to service quality and customer experience, which are both crucial factors in the creation of memorable airport experiences. This survey gathers information from passengers just before boarding their flight and delivers an accurate picture of their satisfaction throughout the airport journey, from check-in through to boarding. The analysis of this passenger feedback enables Malta International Airport to continue improving the terminal facilities and airport services in line with changing guest expectations, with the aim of increasing the overall satisfaction of guests with their experience at the airport, improving the service offering within the terminal, and increasing non-aviation revenue.
Key performance indicators (KPIs), including terminal cleanliness, waiting times and staff courtesy and helpfulness, are consistently measured using a five-point scoring system, with five being the highest score. Malta International Airport’s Overall Satisfaction scores for the four quarters of 2023 are tabulated below. The average score obtained for 2023 was 4.39; a slight drop (-0.02) over the score achieved in 2022. However, given the record passenger traffic being handled by the airport in 2023 and its effect on the limited terminal capacity which is currently being addressed through our expansion project, this score is still a positive one.
Led by a vision of service excellence and enhanced customer experience, the Company will continue working towards maintaining high overall satisfaction scores, which will continue to place Malta International Airport among the top five European performers in ASQ in the coming years.
Malta International Airport plc
Directors’ Report
Year Ended 31 December 2023
5
(continued)
ASQ Scores
 
 
2023
 
2022
 
+/-
1st Quarter
 
4.46
 
4.38
 
0.08
2nd Quarter
 
4.35
 
4.40
 
(0.05)
3rd Quarter
 
4.39
 
4.43
 
(0.04)
4th Quarter
 
4.34
 
4.41
 
(0.07)
Average for the year
 
4.39
 
4.41
 
(0.02)
Malta International Airport plc
Directors’ Report
Year Ended 31 December 2023
6
(continued)
Other upgrades include the installation of a new heating, ventilation and air conditioning system within the terminal (2023: EUR 2.6 million), the conversion of all lighting to LED (2023: 0.6 million), the upgrading of airfield substations and the terminal switch room (2023: EUR 0.2 million), as well as the replacement of the Airfield Ground Lighting (AGL) control room system (2023: EUR 0.9 million).
Principal Risk and Uncertainties
The Board, as a whole, including the Audit Committee members, is responsible for evaluating the nature and extent of the Risk Management Framework, as well as the risk profile that is acceptable to the Board. The Audit Committee periodically reviews the work carried out by the Company’s Risk Management Committee and evaluates the impact that identified risks pose to the Company’s strategic objectives.
The main strategic, corporate and operational risks and uncertainties identified during the year under review are listed below.
Disruption of Critical ICT-Systems
The disruption of an airport's critical ICT system or process, whether through complete or partial disruption, could result in a breakdown of essential communication channels, compromised data integrity, and potential lapses in security protocols. This may lead to operational inefficiencies, hindering the airport's ability to manage flights, process passenger information, and execute security measures effectively. The interconnected nature of modern airport systems amplifies the impact, with failures in hardware, networks, personnel vetting, backups, firewalls, and connectivity potentially causing widespread disruptions, impacting airport operations, safety and security, regulatory compliance as well as the overall passenger experience, potentially leading to reputation damage, substantial recovery costs and financial losses. Mitigating these risks is crucial to maintaining the reliability and functionality of critical ICT systems.
Continuous monitoring and adaptive strategies are essential to sustain this risk posture and uphold the resilience of the Company’s critical ICT systems against unforeseen challenges. Measures for risk mitigation within Malta International Airport include a robust backup strategy, a thorough business impact analysis, software-defined networking redundancy, the implementation of redundant hardware, software and network infrastructure as well as the regular training of key personnel.
Pandemic Outbreak
Malta International Airport has a robust Health and Safety management framework in place. Following the COVID-19 outbreak, tailored emergency response plans as well as protocols enabling effective case management, were implemented in order to ensure that business continuity could be maintained throughout the crisis.
To safeguard its financial stability and preserve its liquidity, the Company also carries out regular analyses of the potential impact on financial results and going concern. Additionally, the Company maintains a close relationship with financial institutions to strengthen its liquidity position should the need arise.
Long-Term Capacity Constraints
Malta International Airport achieved strong traffic development over the past years, with significant growth rates being attained between 2016 and 2019. As a result, the capacity of the aprons and the terminal had been experiencing phases of saturation at peak times, prompting the Company to take concrete action to mitigate the impact of such peak-driven demand. The impact of COVID-19 on international travel, and consequently operations at Malta International Airport, was significant, having short to medium-term repercussions on passenger demand and aircraft movements. Following the reinstatement of unrestricted operations in June 2022, recovery to pre-Covid levels has been stronger than expected, as 2019 movements were surpassed in 2023.
Malta International Airport plc
Directors’ Report
Year Ended 31 December 2023
7
(continued)
During the year under review, the EU Commission strengthened its resolve to implement stronger Border Control measures by introducing the Entry Exit System (EES). The terminal footprint required to introduce EES infrastructure while increased immigration processing times will have a significant impact on the available terminal capacity. Thus, the Company must retain its focus on maintaining sufficient capacity to meet the short-term passenger handling requirements brought about by re-stabilised travel demand, while also ensuring that the terminal and airside infrastructure can sustain future growth over the longer term.
 
To this end, it is crucial for the Company to execute its investment program for the next five years, targeting