By Amir Orusov
(Reuters) -Frankfurt Airport operator Fraport forecast only a moderate increase in 2025 core income and passenger traffic on Tuesday, after missing annual earnings estimates because regulatory costs were higher and people traveled less towards the end of the year.
The stock was slightly down in early afternoon trade after falling as much as 4.4% when it started trading.
Passenger numbers at Frankfurt Airport will not reach pre-COVID-19 levels in 2025 or 2026, CEO Stefan Schulte said in a call with analysts.
He added that new aircraft bottlenecks and excessively high regulatory costs continue to play a major role in slower passenger traffic recovery.
“Fraport’s growth is still being held back by the relatively weak growth of its home-carrier Lufthansa, which is due to delays in aircraft deliveries but also due to the necessity Lufthansa sees to improve the quality of its operations,” Metzler analyst Guido Hoymann wrote in a note to investors.
In 2024, the German flagship carrier accounted for 67% of the total seat capacity in Frankfurt.
Hoymann added it was encouraging that Easyjet would return to Frankfurt from April with flights to Rome and Milan.
Fraport forecast 2025 passenger numbers in Frankfurt to be 64 million versus 61.6 million in 2024.
Jens Bischof, president of the German Aviation Association, said in February that another year of record-high location costs for airlines could put Germany at risk of losing competitiveness in the sector.
Fraport said it expected its annual earnings before interest, taxes, depreciation and amortisation (EBITDA) to increase moderately, and decided again not to propose a dividend due to continued high debt levels.
The EBITDA outlook implies a 2% cut to consensus, Jefferies analyst Graham Hunt wrote in a note, adding the decision to pay out no dividends was a “disappointment”.
Fraport generated core income of 1.3 billion euros in the fiscal year 2024, just missing analysts’ consensus of 1.31 billion.
Its stock rose 15% in the six months to March 13, outperforming its peers.
($1 = 0.9168 euros)
(Reporting by Amir Orusov. Additional reporting by Anastasiia Kozlova, Ilona Wissenbach; editing by Richa Naidu and Milla Nissi)
