Greater Toronto Airports Authority on March 26 reported its financial and operating results for the fiscal year ended December 31, 2019, with passenger activity increasing 2.0 per cent during 2019 when compared to 2018. The airport authority, which operates Toronto Pearson International Airport, notes this moderate growth – relative to recent years – reflects global aviation industry challenges in 2019.
Despite this moderate growth, Greater Toronto Airports Authority (GTAA) over 2019 saw increases in aircraft load factor, aircraft size and flights on existing routes; and Toronto remains as North America’s second busiest airport in terms of international passengers.
“2019 represented a year of positive milestones for Toronto Pearson,” said Deborah Flint, who became president and CEO of the Greater Toronto Airports Authority in April 2019, succeeding Howard Eng, who was set to retire this month. “From a third Airport Service Quality award for Best Large Airport in North America, to surpassing the 50 million passenger milestone, the 50,000 workers across Toronto Pearson delivered an exceptional airport experience that benefits the broader region.”
Flint, who had served as CEO of Los Angeles World Airports (LAX) for the previous four years, continued to explain that entire aviation sector saw several challenges in the second half of 2019, most notably grounding of the Boeing 737 MAX aircraft and the initial travel disruption caused by a novel coronavirus now known as COVID-19. “We are working closely with our partners to care for our customers, adjust as needed operationally, and to ensure the financial sustainability of the GTAA and its related economies,” said Flint.
Toronto Pearson explains it has experienced significant declines in passengers and flight activity during February and March of 2020, as compared to the same period in 2019, because of COVID-19, which was declared as a pandemic on March 11, 2020, by the World Health Organization. The reduced activity is having a significant negative impact on GTAA’s business and results of operations, including aeronautical and commercial revenues and airport improvement fees.
During 2019, 50.5 million passengers travelled through Toronto Pearson, representing an increase of 1.0 million passengers as compared to 2018. GTAA notes passenger activity in the international sector increased by 700,000 passengers reflecting 2.4 per cent growth and the domestic sector increased by 300,000 passengers reflecting 1.4 per cent growth. During 2019, aircraft movements were down 4.2 per cent while the number of seats increased by 1.0 per cent, as compared to 2018. GTAA notes this trend reflects the continued shift by air carriers utilizing larger aircraft in their respective fleet.
During 2019, GTAA reported total revenues of $1.5 billion, representing an increase of $49.6 million over 2018. The airport authority states its continued revenue growth is a reflection of passenger growth and corresponding increases in commercial revenues. During 2019, the GTAA’s commercial revenues increased $53.6 million to $555.5 million, when compared to 2018, primarily based on increased passenger growth, commercial advertising and sponsorship, parking and ground transportation and rental revenues.
GTAA recorded net income of $139.8 million during 2019 compared to $113.7 million in 2018 (adjusted net income, excluding one‐time adjustments, was $139.8 million in 2019 compared to $139.8 million in 2018). GTAA states it has reduced its gross debt per enplaned passenger by 1.6 per cent to $254 and net debt per enplaned passenger by 2.1 per cent to $236, when compared to 2018.
Total expenses reported during 2019 for GTAA were $1.4 billion, representing an increase of $23.5 million over 2018. GTAA states the increased costs were primarily related to higher snow removal costs, information technology costs, building repairs and maintenance costs, increased staffing to manage passenger flow, and a higher depreciable asset base.