PRESENTATION TO THE TOURISM PORTFOLIO COMMITTEE...

AIRPORTS COMPANY SOUTH AFRICA 1

PRESENTATION TO THE TOURISM

PORTFOLIO COMMITTEE

November 2018


CONTENTS

3 COMPANY OVERVIEW AND HIGHLIGHTS

8

29

42

AIRLIFT KEY PARTNERSHIPS

AIRLIFT STRATEGY SUCESSES

AIRLIFT STRATEGY & INITIATIVES

AIRPORTS INFRASTRUCTURE ISSUES42

42 TARIFFS IMPACT ON TOURISM

3

COMPANY OVERVIEW & HIGHLIGHTS

AIRPORTS COMPANY SOUTH AFRICA 4OUR GEOGRAPHIC

FOOTPRINTINDIA

Chhatrapati Shivaji

International Airport in

Mumbai is an equity

investment.

GHANA

The Company performs

technical advisory and

consultancy services at

Kotoka International

Airport in Accra.

BRAZIL

Guarulhos International Airport

in São Paulo is an equity

investment.

SOUTH AFRICA

We operate nine airports and provide technical

advisory and consultancy services for non-

ACSA airports.


HIGHLIGHTS

• Board vacancies filled

• The company continued to be resilient despite challenging

operating conditions

• Maintained sound financial performance and satisfactory airport

service levels

• Remained steadfast in the implementation of our governance

framework and operating model

• Seven transformation sector strategies progressing well

• Continued to strengthen Supply Chain Management governance

processes

• Building relationships with our stakeholders is pivotal in creating

sustainable value


ECONOMIC IMPACT

WHAT ARE WE DOING TODAY TO ENSURE THE LEGACY OF

TOMORROW?

• This figure comprises of 2 992 direct employees (not including contractors),

around 5 519 jobs as a result of supply chain spending and 6 440 supported

through spending of ACSA employees and suppliers employees

Source: PwC Economic Impact Study commissioned by ACSA 2017

ACSA contributed

R9.5 billion toSA’s economyin FY2017

ACSA supported

14 950SA jobsin FY2017*

ACSA supported

R2.8 billionof incometo workers in SA

7

AIRLIFT STRATEGY & INITIATIVES


• New and existing routes, bynew and existing airlinesDevelop

• Existing routes and airlinesperformance throughregular contact withairlines

Maintain

• Trade and Tourism growththrough increase in flights,improves schedules anddeployment of largeraircrafts to our airports

Promote

KEY OBJECTIVES


THE AIRLIFT FRAMEWORK

=

Route

Development

Committee

Structure

Airport

Tourism

Agencies

Local

Municipalities

Economic &

Rural

Development

Agencies

Business

Chamber

Increased Traffic and

more opportunities for

Trade and Tourism


THE GOLDEN TRIANGLE

▪ The three main gateways account for over 80% of the total traffic,

with JNB-CPT city pair being amongst the top 10 busiest in the

world

▪ Over 85% of the flights depart and arrives at the below ACSA

airports

O.R Tambo International

Cape Town International

King Shaka International

11

AIRLIFT KEY PARTNERSHIPS


CAPE TOWN AIR ACCESS

Cape Town International

6,0

1

6,3

3

6,7

5

6,8

3

2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 8

S E A T S O R I G I N A T I N G F R O M C T I A ( M I L L I O N S )

Key Focus Area

1. Intercontinental2. Regional (SSA)

*Largely seasonal capacity from EU

Hong Kong

Top Opportunities

• New York

• Brussels

• Hamburg

• Sydney

• Stockholm

• Dublin

• Sao Paolo

• Dusseldorf

• Berlin

• Copenhagen

• Lagos

• Dar Es

Salam

• Mauritius

• Lusaka

• Maputo

Singapore


Since its inception in July 2015 CTAA has contributed towards:

Landing 13 new routes and 18 route expansions at

Cape Town International Airport (CPT)

Doubling international seat capacity at the airport with

1.5 million seats added

Leading to 16% international terminal passenger growth

in 2016 and 20% growth in 2017

International air cargo has grown by 52% in 2017, Johannesburg

OR Tambo (JNB) grew by 17% and King Shaka (DUR) by 12%.

This has meant and estimated increase in direct tourism

spending of USD 400 million for the local region

CAPE TOWN AIR ACCESS



Top Opportunities

• Mumbai

• Harare

• Lusaka

• Nairobi

• Upington

• Polokwane

• Mthatha

• Plettenberg

Bay

3,0

8 3,5

9

3,6

6

3,7

8

2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 8

S E A T S O R I G I N A T I N G F R O M K S I A ( M I L L I O N S )

*Driven by Domestic; recent UK link

Key Focus Area

1. Intercontinental2. Regional (SSA)3. Domestic

DURBAN DIRECT



GAUTENG AIR ACCESS

O.R Tambo International

Key Focus Areas

1. Intercontinental

2. Regional (SSA)

3. Domestic

14

,13

14

,51

14

,54

14

,33

2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 8

S E A T S O R I G I N A T I N G F R O M O R T I A ( M I L L I O N S )

• Lagos

• Dar Es Salam

• Mauritius

• Libreville

• Upington

• Mthatha

• Plettenberg

Bay

Top Opportunities

*SAA shed over 1.2 million seats & Mango only filled 35%

• Mumbai

• Phuket

• Lisboa

• Bangkok

• Dublin

• Brussels

• Auckland

• Shanghai

• Melbourne

• Brisbane


NELSON MANDELA BAY AIRLIFT

Current

Pipeline

Top Opportunities:

Short-Haul: (12 – 24 Months)

1. Kruger – Mpumalanga2. Windhoek – Namibia3. Kigali – Rwanda4. Harare – Zimbabwe5. Lanseria — Gauteng

Long-Haul: (5 – 8 Years)

1. London – UK2. Frankfurt – Germany

AIRPORTS COMPANY SOUTH AFRICA 17SECONDARY AIRPORTS:

INTRA-CONNECTIVITY

With Golden Triangle

Without Golden Triangle

C

U

R

R

E

N

T

▪ The golden triangle remains

the anchor for regional Airports

connectivity

▪ Outside the triangle, regional

connectivity is below

acceptable level thus

constraining mobility


❑ Connectivity for Small

communities

• Bram Fischer to link

Coastal and Inland Cities

• Regional aircraft has

favourable economics

and configuration

BRAM FISCHER AIRPORT AS

REGIONAL ANCHOR

FUTURE

❑ Collaboration is key

• Airlines

• Airport

• City & local

government

• stakeholders

❑ Enabling Structures

• Garden Route Airlift

• Mangaung Airlift

• Northern Cape

Airlift

• Eastern Cape Airlift

Regional airports integration into the national air transport network will focus on Bram

Fischer as an anchor for regional connectivity

19

AIRLIFT STRATEGY KEY SUCCESSES


KEY SUCCESS FACTORS

Rome

Sao Paolo

Madrid

Kigali/Harare

Nairobi/Victoria

Falls/Livingstone

Hong KongAddis Ababa

O.R Tambo International Airport Cape Town International Airport King Shaka International Airport

Frankfurt

Gatwick

London

Dubai

St. Helena

Gaborone/Windhoek

Vienna

Zurich

*Seasonal

Gatwick

Munich

Singapore Via OR Tambo MaunLubumbashi


KEY CHALLENGES

FUNDING: Airline incentivisation and route marketing

EXTERNAL DEPENDENCIES: Airlines and the industry operating

environment (i.e. aircraft availability and oil prices)

COMMITMENTS: From key stakeholders to promote air access

i.e. agencies

TARIFF PERMISSION: Funding for Bram Fischer Airport

infrastructure to support the regional air access strategy and meet

demand.

22

AIRPORTS INFRASTRUCTURE ISSUES


AIRPORT INFRASTRUCTURE ISSUES

Compliance and Compatibility

• Code F compliant to

accommodate larger aircraft

such as Airbus A380 in

Cape Town

• Related taxiways for faster

turnaround times on runway

Congestion and Capacity

• Terminal Congestion

Check-in facilities, boarding

gates, departures lounges

etc.

• Airside Capacity –Apron

parking stands; to

accommodate and unlock

traffic growth (passenger

and cargo).

• Runway Capacity to

accommodate traffic growth

Efficiency and Technology

• Account for changes in

the landscape:

• Technology e.g. self

service end to end

process for passengers

24

RESPONSE TO INFRASTRUCTURE ISSUES


O.R. TAMBO INTERNATIONAL

AIRPORT MASTER PLAN



REMOTE APRON STANDS

RAS

• 9 Code F stands in MARS

configuration (9 Code F or 18 Code C)

and 7 Code C stands linked with the

Western Terminal Complex via an

internal airside link road.



MIDFIELD CARGO PHASE 1

The Phase 1 Cargo development will consist of general cargo

warehouses, express and specialised cargo handling facilities, freight

forwarders warehouses as well as respective truck manoeuvring and

parking areas to accommodate 750 000 tonnes of Cargo per annum

It will consist of a total built-up area of approximately 700 000 m².

• 220 000 m² of cargo and specialised cargo handling facilities

• 70 500 m² of 1st tier cargo handling facilities

• 40 000 m² of specialised/express cargo facilities

• Forwarders/supporting 2nd tier facilities: 110 900 m²

• Mezzanine offices of approximately 40 000 m²

• Access Roads

AIRPORTS COMPANY SOUTH AFRICA 28WESTERN PRECINCT

COMMERCIALISATION PHASE 1The Development is on a 8.5 hectare

site with 180 000m² of bulk of mixed use

development located on the north western

precinct of ORTIA. The development will

compromise of 7 phases :

• Offices – 50 000m²

• Retail – 21 000m²

• Transport Station – 5 000m²

• Hotel and Conference – 22 000m²

Phase 1A which shall consist of the

development of A Grade 33 000m² office

development and associated facilities as

follows:

• Block A – 13 500m² - 4-star green

rated, 6 storeys above podium

(SACAA)

• Block B – 12 000m² - 4-star green


(ACSA)

• Block C – 5 000m² - 4-star green rated

,4 storeys above podium

• Block D – 2 500m² – 4-star green


(common use facility which includes,

canteen, gym and other amenities)

• Upgrade of the Northern Roads

• Super Basement parking of 1967 bays

AIRPORTS COMPANY SOUTH AFRICA 29CAPE TOWN INTERNATIONAL

AIRPORT MASTER PLAN


NEW REALIGNED RUNWAY

New Realigned Runway

Existing Runway

The existing runway will be displaced at the

northern end with 220m to the east and rotated

at angle of 11.5 degrees.

The new realigned runway will be 3500 m long

and 75 m wide and fully Code F compliant.

Allowing for a future independent runway system

The runway will initially include two RET’s and a

partial parallel taxiway as indicated on the layout


TERMINAL 2 REDEVELOPMENT

Terminal 2 Redevelopment comprises of the following:

• The expansion of the international departure baggage hall

• The addition of 2 Code F international carousels

• The reconfiguration of the customs and meeters & greeters areas

• New e-emigration gates

• Additional self service check-in & security capacity

• New arrivals retail mall

• New basement level


CAPE TOWN INTERNTIONAL

NEW DOMESTIC ARRIVALS • Redevelopment of Domestic Arrivals

Terminal

• Increased meeters & greeters area

• Increased baggage reclaim area that will

provide additional space between

carousels

• Additional carousel ( #7)

• Basement level for delivers & commercial

storage

• Second Floor retail enablement ( adjoining

domestic departure lounge )


KING SHAKA INTERNATIONAL

AIRPORT MASTER PLAN


• Expansion of the terminal building towards the north, to provide additional capacity

for the international terminal.

• Two wide body carousels on the arrivals level.

• Inclusion of an additional check-in bank, on the departures level, with additional

international airside retail and emigration reconfiguration.

KING SHAKA INTERNATIONAL

TERMINAL EXPANSION


BRAM FISHER AIRPORT

AIRPORT DEVELOPMENT

• Reconfiguration of the existing terminal to provide additional space for both the

lounge and common concourse space.

• Construction of one additional code C stand. A new GA area will be constructed

west of the new stand.


EAST LONDON AIRPORT

AIRPORT MASTER PLAN

• Expansion of the departure lounge by approx. 300m2, including allowances for retail

• Construction of a Multi-story Parkade and access roads to accommodate future traffic

growth.

• The Multi-story Parkade will have a minimum of 800 bays in total.


GEORGE AIRPORT

LAND-USE PLAN

• Extension of the terminal building with a new processing facility, including a

concourse to provide for contact stands.

• Relocation of existing Rescue and Fire Fighting Facility and General Aviation

area

AIRPORTS COMPANY SOUTH AFRICA 38PORT ELIZABETH AIRPORT

AIRPORT MASTER PLAN

• Extension of the terminal building with a new processing

facility, including a concourse to provide for contact stands.

AIRPORT TARIFFS

IMPACT OF THE AIRPORT TARIFFS ON TOURISM


AIRPORT TARIFFS

Source: IATA Economics 2014

Airports tariffs accounts for 5% of an airline direct operating cost

Air navigation charges4%

Other1%

Fuel and oil33%

Maintenance and overhaul

9%

General and adminstrative

7%

Flight deck crew7%

Reservations, ticketing, sales and

promotions7%

Station and ground7%

Aircraft ownership11%

Airport charges5%

Cabin crew5%

Passenger service *4%

AIRLINE COST STRUCTURE


Airport charges

+/- 50% off all

revenues

Passengers

+/- 67% of

total

Airlines

+/- 33% of

total

Passenger

service

charges

Landing fees

Parking fees

PSC Tariff

Domestic R87

Regional R181

International R238

Landing fee

• Based on aircraft

maximum take-off

weight

• Differentiated between

domestic, regional and

international

Parking fee

• Based on time parked

in excess of 4 hours

• Differentiated between

domestic, regional and

international

Levied on the

airline ticket as a

regulated charge

(VAT incl.)

Airline

operational cost

The airport tariffs charged on an air-ticket are unlikely to influence traveller behaviour.

AIRPORT CHARGES

THANK YOU

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