March 12, 2009, Toronto - The Greater Toronto Airports Authority (the
"GTAA") reported its financial and operating results for the fiscal year
ending December 31, 2008 yesterday. A total of 32.3 million passengers were
processed at Toronto Pearson International Airport in 2008, a 2.8% increase
over 2007.
For the twelve months ended December 31, 2008, the GTAA reported total
revenues of $1.17 billion. Total operating expenses were $555.2 million,
including $140.6 million in ground rent paid to the federal government.
Revenues over operating expenses in 2008 were $617.3 million. After accounting
for debt service and amortization, the GTAA recorded revenues under expenses
of $45.9 million for the year, compared to revenues under expenses of $44.0
million in 2007. The excess of expenses over revenues was anticipated due to
the amortization of airport facilities, a non-cash expense which is not
recovered from the airlines operating at Toronto Pearson.
During the 3-month period ended December 31, 2008, the GTAA recorded
revenues under expenses of $51.4 million. Due to seasonal patterns in air
traffic and operating expenses, expenses typically exceed revenues in the
fourth quarter of each year. However this was exacerbated in 2008 because in
the fourth quarter of 2008 the GTAA recorded a $29.1 million reduction in the
estimated fair value of the Asset Backed Commercial Paper that it holds. Also,
Airport activity in the fourth quarter of 2008 exhibited weakness when
compared to growth rates earlier in the year and in the comparable period in
2007.
Results for 2007 include receivable recoveries of $13.1 million and $16.2
million of net revenues identified as part of the annual reconciliation of
Airport Improvement Fee revenues and passenger volumes. When adjusted for
these events, the 2008 revenue over operating expenses would show a $35.8
million improvement over the 2007 results.
The full-year 2008 results include a $52.7 million impairment charge in
respect of the Asset Backed Commercial Paper held by the GTAA as at December
31, 2008, compared to the $37.2 million provision taken in 2007.
To fund the development programs and other capital programs and to repay
maturing debt, the GTAA issued $825 million in medium term notes during 2008.
Debt repayments totaled $735 million during the year.
It is anticipated that Airport activity in 2009 will be below that of
2008 and the GTAA has developed a comprehensive plan to manage the effects of
this traffic downturn. Within this context, the focus of the GTAA continues t
be on competitiveness, growing the Airport's status as an international
gateway and ensuring the long-term success of the organization, our partners
and the regional economy.
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