Changi Airport Group has reported its full year results end March 2024. And it is a very good result (click here for full year results).
Profit to Shareholders $430 Million, Revenue up 44%
As per the headline, awesome profits with much of the profits coming from Airport operations.
Page 64 shows Airport operations revenue rose 46% and all of its profits came from airport side. Jewel shopping mall continues to make losses at about $20 million but its operations is improving. Do note airport operations do not just cover Singapore because Changi Airport has stakes in other airports as well.
Cashflow
The group turned in a free cash generation ability of $100 million and it is worth noting in Page 14, Changi Airport Group received $464 million in government grants under "Cashflow from financing activities". Without the grants given by the government, it could be possible that Changi Airport Group will be loss making.
Shareholders will be receiving about $141 million in dividends (~30% dividend payout)
Valuation
Its a bit dicey to talk about valuation.
If Changi Airport Group (CAG) was listed, the Singapore government would not be justified to give the group approx $464 million in grants in a year. This is because public funds would have been used to help a private listed company. CAG is currently a company under the Ministry of Trade and Industry. In this sense, if Changi Airport was really listed, it could be a net zero profit entity.
However, given the monopoly position the airport holds, that it is an aviation hub, with growing passenger traffic and T5 expansion, I do think a $200 million profit can be eked out even without government grants. Overseas listed airports have been going at 30-40 times price earnings. The company could be worth a $7 billion valuation if it is ever listed.
This market cap will also enable it to qualify to be part of the FTSE ST Index. It will be an interesting scenario if Changi Airport is ever listed.
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