Senior Credit Analyst
July 29 2019
Summa strengthens its airport concession and hospitality business. In May 2019, Summa Group became the sole operator of the Diori Hamani International Airport (DHIA) in Niamey, Niger, delivering on its strategy to grow its aviation asset portfolio in SSA. During the preceding months, the company completed an ambitious airport modernisation project, having built new passenger and cargo terminals, passenger boarding bridges, a presidential pavilion, a new taxiway and an airport utility centre in less than a year (see Figures 1-6 on page 2). Simultaneously, Summa brought the first international 5-star hotel chain to Niger, having built the 189-room Radisson Blue. The inauguration of the hotel and airport took place on 11 June 2019. Summa invested EUR154mn in the airport facilities and infrastructure, and EUR38mn developing the hotel.
DHIA – a new source of recurring revenue. As the sole operator of the DHIA, Summa is able to optimise processes and exercise stringent cost control at every step of value creation to maximise the return on its investment. There are two main revenue streams for Summa: 1) aeronautical revenues, including all charges related to arrival and departure of aircraft, passengers and cargo; and 2) non-aeronautical, including retail concessions, airline catering, car parking and other services provided in a modern international airport. In addition, under the terms of the 30-year concession agreement, Summa is entitled to a EUR52 infrastructure development charge per departing international passenger, collected directly from the International Air Transport Association (IATA).
Strong momentum in DHIA traffic. Passenger traffic, the key underlying driver of revenue growth, has been on an upward trend since 2017. According to the data provided by Summa, c157,000 passengers travelled to and from DHIA in H1 19, representing a 16% yoy increase in traffic. International passengers accounted for 88% of all arrivals and departures during the period. Construction of a cargo terminal unlocked airborne freight delivery, with volume increasing 3.5x yoy in H1 19.
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