11 May 2023
Approved Interim Financial Report as at 31 March 2023
Air traffic volume above pre-pandemic levels
- En-route and terminal traffic at +26.8% and +22.5%, respectively, in terms of service units, compared to the first quarter of 2022
- Revenues from operations of €177.6 million (+20.5% compared to the first quarter of 2022)
- Consolidated revenue of €176.8 million (+5.2% compared to the first quarter of 2022)
- Consolidated EBITDA of €9.7 million and EBITDA margin of 5.5% due to the seasonality that characterizes ENAV’s core business
- The consolidated net result amounted to -€21.8 million, likewise due to the business trend seasonality
Rome, 11 May 2023 - The Board of Directors of ENAV S.p.A., in their meeting held today under the Chairmanship of Alessandra Bruni, approved the Interim Financial Report as at 31 March 2023.
In the first quarter of this year, en-route air traffic volumes in Italy, measured in service units, showed a positive performance compared to the same quarter of the previous year, but also an increase of 4.2% compared to the first quarter of 2019, considering a European air traffic that was still lower by 3.9% compared with the pre-pandemic year. Among the top five European service providers, Italy, along with Spain, rose the highest compared with the volumes reported in the first quarter of 2019: Germany was -15.3%, France -9.1%, the United Kingdom -6.9% and Spain +6.5%.
En-route traffic, expressed in service units, increased by 26.8% in the first three months of 2023 compared to the first quarter of 2022. In detail, international commercial traffic (flights departing from or arriving at an Italian airport) increased by 38.3%. Overflight traffic (flights crossing Italian airspace without landing) showed a growth of 33.1%. Domestic traffic (flights departing from and arriving at airports in Italy) increased by 4.3%.
Terminal traffic, in the first quarter of 2023, showed a growth of 22.5% in terms of service units compared to the first quarter of 2022. The increase in terminal traffic was widespread throughout Italy.
ECONOMIC-FINANCIAL PERFORMANCE
The first quarter of 2023 economic results were fully affected by the traditional seasonality that characterizes the air transport. This seasonality foreseen air traffic volume, and therefore revenue, at its lowest in the first quarter and significantly higher during the summer season, compared to costs that remain relatively stable over the year. Indeed, while revenue reported a positive performance compared with the first quarter 2022, as a result of the air traffic managed, it was able to only partially offset the increasing costs, particularly personnel which were impacted by the renewal of the labour contract signed at the end of 2022.
Total consolidated revenue for the first quarter of 2023 amounted to €176.8 million, up 5.2% compared to the same period of 2022, mainly due to the increase in revenue from operations related to air traffic recovery. The balance component in the first quarter of 2023 negatively impacted revenues by €9.3 million, compared to a positive €12.4 million in the first quarter of 2022. This difference is mainly due to previous years balance reversal almost completely related to the recovery of the one accrued in the combined-period 2020-2021 which will be recovered in tariffs starting from the beginning of 2023.
Revenues from operations grew by 20.5% in the first quarter of 2023 due to the ongoing air traffic increase.
Revenues from the non-regulated market amounted to €5.8 million and are mainly related to air traffic control support services provided to different worldwide customers, the modernisation and installation of airport systems, for radio measurement services and services provided by the subsidiary IDS AirNav.
External costs amounted to €37.4 million, up 11.4% year-on-year, primarily due to new contracts not included in the first quarter of 2022, an increase in the Eurocontrol contribution of €1.5 million and a rise in employee travel.
These factors resulted in EBITDA of €9.7 million and an EBITDA margin of 5.5%. EBITDA was down by 35.9% compared to the first quarter of 2022 due to the costs trend, despite a positive revenue performance driven by higher manged volumes of air traffic.
The EBIT was negative by €19.9 million.
The ENAV Group closed the first quarter 2023 with a net loss of €21.8 million, in line with the first quarters of previous years, which were impacted by the traditional seasonality of the Company’s core business, where traffic volumes, and therefore revenues, are at their lowest levels in that quarter of the year, while costs follow a much more linear trend.
Net financial debt as at 31 March 2023 was €390.9 million, improving by €17 million compared to 31 December 2022 thanks to the effect of income and payment dynamics related to day-by-day operations, which produced a positive cash flow during the quarter, mainly related to higher cash-in from the Parent Company’s core business.
OUTLOOK 2023
Following the release of Eurocontrol’s new air traffic forecast at the end of March, the Company now expects to handle 10.6 million en-route service units in 2023 and to report mid-single digit total revenue growth year-on-year, with revenue from the non-regulated business expected to grow high-single digit. EBITDA is also expected to grow mid-single digit compared to 2022. Investments in 2023 are expected to be around €100 million.