Prague Airport Group Handles Pandemic Crisis with Honour, Prioritising Stability and Safety Procedures

30. 7. 2021

In 2020, the Prague Airport Group reported the gross operating loss (EBITDA*) of CZK 687 million. Its economic results were negatively affected the most by the greatest crisis in air transport, the COVID-19 pandemic, which caused a decrease in the number of handled passengers of almost 80%. The fact also significantly affected the passenger and aircraft handling services provided by the Czech Airlines Handling subsidiary. The decline in operations and uncertainty in the market affected the aircraft maintenance segment provided by Czech Airlines Technics, too. The Group thus implemented significant austerity measures last year. The main goal was to ensure the operation and financing of companies, maintain stability, and continue to provide services for passengers, airlines and other customers at the high level as before. Alongside safety, the health of passengers and employees became a priority. Nevertheless, the crisis provided numeral opportunities for all companies associated in the Group to further develop their services, products and infrastructure.

“Looking back in retrospect and considering all circumstances, we managed 2020 with honour. From the beginning, we viewed the crisis as an opportunity. We used the limited traffic to accelerate certain necessary airport infrastructure reconstruction and modernisation projects. We continued the sustainability and digitisation efforts throughout the airport. The safety of passengers and employees remained our utmost priority, enhanced with the health protection aspect, the appreciation of which was confirmed by the receipt of the international ACI Airport Health Accreditation (AHA) Certificate and, for the second time in a row, the ASQ Award based on customer satisfaction,” Jiří Černík, Member of the Prague Airport Board of Directors, said.

Thanks to the responsible approach in previous years, financial reserves and effective cost management, the financing of individual Group companies was ensured. The Group can obtain external sources of financing mainly due to long-term financial stability and excellent operating and economic results from previous years, alongside responsible management decision-making approach. The correct steps and strategy, implemented even during the pandemic, have been confirmed by the official rating on creditworthiness by the renowned Moody's Investors Service agency. Just last year, the agency confirmed the Prague Airport Group's Aa3 rating with a stable outlook, which reflects a very low credit risk. The international agency decided on the highest possible rating in the Czech Republic predominantly with regard to the strong financial profile of the Group, perceived as resilient even to uncertain operating prospects for the following period of the gradual resumption of operations.

After the past record years, the 2020 gross operating loss (EBITDA) of Prague Airport, the operator of the largest international airport in the Czech Republic, equalled to CZK 459 million. Prague Airport remained open as part of the country's critical infrastructure throughout the pandemic, handling flights with vital medical supplies on board and important repatriation flights, among other things. In 2020, the airport financed its operations from own resources and applied for an external loan at the very end of the year. Despite the gradual resumption of flights to dozens of destinations and increasing demand for travel, a little less than 3.7 million passengers were handled at Václav Havel Airport Prague last year, compared to 2019, when the record of almost 18 million people handled in a single year was broken. At present, flights to more than a hundred destinations are offered from Prague, and, with the relaxation of the rules for travel, the interest in flying is growing steadily. It is estimated that the aviation market segment could reach the 2019 volumes in about four to five years.

Czech Airlines Handling (CSAH), a provider of complex services comprising the ground handling of passengers, aircraft, cargo and post at Václav Havel Airport Prague, reported the gross operating loss of CZK 126 million in 2020. “Despite the dramatic decline in air traffic and the number of passengers handled, we managed to strengthen our position at Prague Airport, winning several new airline customers and increase the total volume of handled flights, including cargo transport. We continue to finance our operations from our own financial reserves accumulated in previous years. This makes us rather an exception among the competing providers of handling services on European market," Tomáš Svoboda, Chairman of the Czech Airlines Handling Board of Directors, commented.

The gross operating loss (EBITDA) of Czech Airlines Technics (CSAT), a provider of aircraft and aircraft components repair and maintenance at Václav Havel Airport Prague, reached CZK 102 million in 2020. Despite the pandemic, the Company’s Base Maintenance division performed approximately 80 overhauls, succeeded in tenders, thus winning new customers, and expanded the range of its service portfolio. “We decided to reflect new market challenges, offering our clients a new service of short-term and long-term aircraft parking, complementing the range of our maintenance services. We launched co-operation with leasing companies, expanded our authorisation portfolio with new types of aircraft and made significant investments within the division of spare landing gear sets. We have actively entered the new season and now continue to develop all our divisions,” Pavel Haleš, Chairman of the Czech Airlines Technics Board of Directors, said.

The Prague Airport Group key companies are Letiště Praha, a. s. (Prague Airport), Czech Airlines Handling, a.s. (CSAH), and Czech Airlines Technics, a.s. (CSAT). Prague Airport, owned by the Ministry of Finance of the Czech Republic, is the sole shareholder of the CSAH and CSAT subsidiaries.

2020 EBITDA of Prague Airport Group Key Companies:

*Company*	*EBITDA (in mil CZK)***		*2020 vs 2019*
*Company*	2020	2019	*2020 vs 2019*
Prague Airport	-459	4,543	-5,002
CSAH	-126	33	-159
CSAT	-102	102	-204
	-687	4,678	-5,365