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Annual General Meeting: Fraport Group Continues Its Successful Path

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Annual General Meeting: Fraport Group Continues Its Successful Path

Outlook for 2017 fiscal year fulfilled – International business expansion achieves important milestones – Frankfurt Airport records strong growth – More efficient security screening processes required

FRA/gk-rap – At Fraport AG’s regular Annual General Meeting (AGM) held today (May 29), CEO Dr. Stefan Schulte presented the results of a highly successful 2017 fiscal year (ending December 31). Commenting on the Group’s positive business performance, Schulte said: “Supported by strong traffic growth, both our revenue and adjusted earnings reached new record levels. We achieved our targets in full and are well positioned to continue this growth trend.” Group revenue climbed by almost 13.5 percent to €2.93 billion. The first-time consolidation of Fraport’s Greek airports contributed a significant €235 million to Group revenue. The slight decline in operating earnings (EBITDA) can be attributed to extraordinary effects in the previous 2016 business year. In particular, Fraport’s strong earnings in 2016 resulted from the compensation payment received for the Manila project and from the sale of shares in Thalia Trading Ltd. Adjusting for these one-off effects, EBITDA increased by around 18 percent to just over €1 billion, while the adjusted Group result (net profit) improved by 21.6 percent to about €360 million.

International business gaining momentum

Fraport’s international business segment made a significant contribution to the Group’s strong performance, boosting its share of total operating earnings from 24 percent in 2016 to 32 percent in fiscal year 2017 (also adjusted for special effects). A marked increase in passenger traffic at all of Fraport’s Group airports worldwide triggered the growth of this segment. In the long term, Fraport’s strategy is to further increase the segment’s share of earnings. With the operational takeover of airports in Greece and Brazil, Fraport has reached important new milestones in expanding its international portfolio. Dr. Schulte said: “By continuously expanding our international portfolio, we are utilizing additional growth opportunities. As a result, we are giving our company an even stronger and broader business footing, and, above all, we are generating more revenue.”

Frankfurt Airport sees strong growth

At Fraport’s Frankfurt Airport (FRA) home base, passenger traffic increased by 6.1 percent to 64.5 million passengers in 2017. This growth trend has continued throughout the first four months of 2018, with passenger numbers rising by 8.7 percent. FRA’s strong passenger growth stems, in particular, from traditional network carriers – with Lufthansa being the main growth driver. CEO Schulte stated: “Frankfurt Airport will always remain a premium hub with a clear focus on providing best transfer processes and world-class connectivity. To fulfil this commitment, however, passenger screening processes at German airports need to be streamlined. Compared to Germany, other international hub airports benefit from more efficient and simpler processes that allow about twice as many passengers to be screened per checkpoint, in the same amount of time. Therefore, we urgently need the appropriate decision-making by the responsible German Ministry of the Interior to achieve acceptable waiting times again at the security checkpoints.”

Targeted infrastructure development at FRA

To accommodate the expected long-term growth in the aviation market, Fraport continues to advance its targeted infrastructure development. The construction of FRA’s new Terminal 3 is proceeding as scheduled. Fraport is awaiting the construction permit from the City of Frankfurt for the new Pier G, which will be realized earlier than originally scheduled. Dr. Stefan Schulte explained: “With these investments, we are opening a new chapter for Frankfurt Airport. Our investments will ensure that, in a growing aviation market, we will be able to provide the necessary capacities to airlines now and in the future.”

Outlook for 2018 confirmed

Based on the positive performance in the year to date, Fraport is maintaining its guidance for the full 2018 fiscal year. Passenger traffic at FRA is expected to reach between 67 million and 68.5 million passengers, representing an increase of more than 6 percent. Fraport expects the Group revenue to grow up to some €3.1 billion (adjusted for IFRIC 12 effects). Group EBITDA is forecast to range between about €1,080 million and €1,110 million, while Group EBIT is expected to be between approximately €690 million and €720 million. The Group result is also anticipated to rise significantly to between about €400 million and €430 million. The Executive Board and Supervisory Board will propose to the Annual General Meeting a dividend of €1.50 per share for the 2017 fiscal year – the same amount as in the previous year. Fraport plans to increase the dividend for fiscal year 2018.

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UK fishing sector sees more job losses if post-Brexit export troubles not tackled soon

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UK fishing sector sees more job losses if post-Brexit export troubles not tackled soon 1

By Maytaal Angel

LONDON (Reuters) – Britain could lose more jobs in its fishing sector if the current delays and increased costs involved in exporting to the EU post-Brexit are not ironed out soon, industry groups told British government officials on Tuesday.

Speaking at an Environment, Food and Rural Affairs (EFRA) select committee inquiry, representatives of Britain’s fishing sector said small to medium-sized enterprises were especially at risk and called on the government to urgently negotiate new export rules with the EU.

“(Even) if we get (export) systems sorted, we will still have cost implications. In the medium term, small companies will stop trade to Europe and it may even be their demise,” said Donna Fordyce, chief executive of Seafood Scotland.

“It’s a real worry. These people can’t see a future.”

Under a Brexit deal reached late last year, British trade with the EU remains free of tariffs and quotas. But the establishment of a full customs border means goods must be checked and paperwork filled in, damaging express delivery systems.

Fresh food sectors like fishing and meat have been particularly hard hit, with export paperwork costs soaring and delivery delays prompting EU buyers to reject British produce or to pay less for it.

Sarah Horsfall, co-chief executive of the Shellfish Association of Great Britain, said some British shellfish companies had already shut their doors, buckling under the pressure of the COVID-19 pandemic, and then Brexit.

She said paperwork costs per consignment have increased by 400-600 pounds. On top of that, companies often need to hire two or three extra staff just to fill in the paperwork, adding to costs.

Another point of contention for the British seafood sector is that EU exporters are currently not facing increased costs or delays in sending goods to Britain because the UK has postponed introducing reciprocal customs checks by three to six months.

“Exporters we deal with are considering relocating to the EU. We have to address this urgently if we want to grow, because at the moment we are at the risk of doing the opposite,” said Martyn Youell, senior manager of fisheries and quotas at fishing company Waterdance.

(Reporting by Maytaal Angel; Editing by Sonya Hepinstall)

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Fall in UK economic activity bottoms out in February – PMI

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Fall in UK economic activity bottoms out in February - PMI 2

LONDON (Reuters) – British economic output stabilised in February after a sharp fall the month before, as many businesses continued to suffer from lockdown restrictions affecting hospitality and other face-to-face services, a closely watched survey showed on Wednesday.

Hours before finance minister Rishi Sunak is due to set out his economic plans for the coming year, the IHS Markit/CIPS composite Purchasing Managers’ Index gave a reading of 49.6 for February, up from an eight-month low of 41.2 in January.

The figure means businesses reported broadly stable activity for last month after a steep deterioration early in the year, and is little changed from an initial flash estimate of 49.8.

The PMI for the services sector alone rose to a four-month high of 49.5 in February from January’s eight-month low of 39.5, again in line with the initial flash estimate.

“Restrictions on travel, leisure and hospitality due to the national lockdown continued to curtail overall activity, but there were some pockets of growth in technology and business services,” financial data company IHS Markit said.

Britain entered its third national coronavirus lockdown in early January, closing schools, non-essential shops and most other businesses open to the public, though people can still travel to work if needed.

Last week Prime Minister Boris Johnson set out a path for easing the lockdown in England as vaccinations roll out rapidly. Schools will reopen next week but full restrictions on hospitality venues will not go until late June at the earliest.

Sunak is expected to set out further spending plans in a budget statement around 1230 GMT after providing almost 300 billion pounds of support during the past year.

Business optimism in the services PMI has risen to its highest since 2006 due to expectations of a return to normality. But many firms still reported difficulties from new, post-Brexit trading restrictions that took effect on Jan. 1.

(Reporting by David Milliken; Editing by Catherine Evans)

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Japan’s SMFG likely to halt all new lending to coal-powered plants, sources say

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Japan's SMFG likely to halt all new lending to coal-powered plants, sources say 3

By Takashi Umekawa

TOKYO (Reuters) – Japan’s Sumitomo Mitsui Financial Group is likely to halt all new financing to coal-fired power plants, including the most efficient ones, two sources said, reflecting growing pressure from investors and environmentalists on Japan’s lenders to cut funding to coal.

While SMFG has said it would not finance new coal-fired power plants in principle, up until now it hasn’t ruled out funding projects seen as more environmentally friendly, such as so-called “ultra-supercritical (USC) power plants” that burn coal more efficiently than older designs.

It is now likely to remove that exception from its lending policy, meaning a complete halt to new finance for coal plants, said the sources, who declined to be named as the information is not public.

Japan’s biggest banks are under increasing pressure from global investors and environmental groups over their long involvement in funding coal projects. Prime Minister Yoshihide Suga has also pushed to achieve zero greenhouse gas emissions, on a net basis, by 2050.

“It’s a fact that the criticism from environmental groups has become so strong,” said one of the sources.

A spokesman for SMFG said nothing had been decided.

(Reporting by Takashi Umekawa; Editing by David Dolan and Edmund Blair)

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