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France's ADP hikes annual guidance as it returns to profit

·2-min read
FILE PHOTO: The logo of Groupe ADP at Paris Charles de Gaulle airport

By Dagmarah Mackos and Augustin Turpin

(Reuters) - French airport operator ADP on Thursday raised its financial guidance as it returned to profit for the first time since 2019, boosted by a recovery in traffic in the first half of the year, in particular at Paris Aeroport.

ADP, operator of the French capital's Orly and Roissy Charles de Gaulle (CDG) airports, now expects an EBITDA (earnings before interest, taxes, depreciation and amortization) margin of between 32% and 37% of revenue in 2022 and 2023, against its previous forecast of between 30% and 35%.

Last week, ADP raised its traffic outlook for the year, saying it expected total traffic of 74%-84% of 2019 levels across its whole network of operated airports, and 72%-82% of 2019 levels for Paris Aeroport.

ADP, which around the start of July was hit by strikes at its CDG airport, said it estimates a "tiny" material impact of two salary increase agreements for its employees at 13 million euros ($13.20 million) in the second half of the year.

"We should have increased salaries without any strikes so it doesn't have a lot of incidence," Chief Executive Augustin de Romanet said in a call.

Several European airlines and airports have experienced strikes in recent weeks as workers push for higher wages and better working conditions.

In Paris alone, traffic in the first half of the year was up by 249.2% year-on-year to 37.5 million passengers, at 71.6% of its 2019 level.

A total of 118.2 million passengers passed through all of ADP-operated airports from January to June, a 134.4% rise year-on-year, or 71.9% of pre-pandemic levels.

That lifted ADP's net result to 160 million euros in the six months to June, more than double the 78 million euros expected by the analysts in a company-complied consensus.

European airport operators have benefited from a rebound in air travel with the easing of coronavirus restrictions, but ADP's Spanish rival Aena warned this week that it does not expect a recent sharp recovery in passenger numbers to be sustained due to the tough economic environment.

ADP expects a modest impact of inflation on its costs, it said in a call.

($1 = 0.9846 euros)

(This story corrects paragraph 7 to show Paris traffic was at 71.6% of its 2019 levels)

(Reporting by Dagmarah Mackos and Augustin Turpin; editing by David Evans, Marguerita Choy and Leslie Adler)

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