"Hong Kong's Airport Profits Drop 23 Pct."

Tuesday, August 10, 2004

Hong Kong's Airport Profits Drop 23 Pct. 
The Associated Press


Hong Kong's airport profits plunged 23 percent in 2003 as revenue
dwindled when airlines scaled back services to the territory during an
outbreak of SARS, the airport operator said Wednesday. 

The Airport Authority said its net profit for the fiscal year ending
March 31 dropped from 502 million Hong Kong dollars (US$64.4 million) to
HK$386 million (US$49.5 million) the previous year. 

Its revenue declined from HK$5.42 billion (US$695 million) to HK$5.04
billion (US$646 million) over the same period. 

The outbreak of severe acute respiratory syndrome devastated Hong Kong's
tourism industry and other tourism-driven businesses by keeping
travelers away. Airlines canceled thousands of flights. 

Hong Kong's airport was hit hard because it typically draws about 40
percent of its revenue from charges to airlines, including landing,
parking and terminal fees, an airport authority spokeswoman said on
condition of anonymity. 

She said revenue was also hurt because of reduced sales at retail
outlets in the airport, which pay a fixed percentage of their profits to
the airport. 

The airport spent HK$192 million (US$24 million) on relief and incentive
measures, including landing fee discounts, to draw airlines and
travelers back. 

The Airport Authority said passenger traffic fell by 19 percent to 27.7
million people during the 2003-04 fiscal year. 

The SARS epidemic infected 1,755 people in Hong Kong and killed 299.
Worldwide, 774 people died and thousands were sickened.


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