AdP signs Economic Regulation Agreement with French Government, European airports strong

Shares in France’s Aéroports de Paris (AdP) led the way yesterday, rising 5.5% as it signed the new Economic Regulation Agreement with the French Government for the 2011-2015 period. AdP expects passenger traffic to rise 3.2% over the next five years.

The agreement follows on from the one signed in early 2006 and covers the major proposals put forward by Aéroports de Paris on 19-Feb-2010 in the public consultation document. The points of the new agreement are:

  • An EUR1.8 billion investment programme for the regulated scope mainly focusing on improving the oldest terminals, associated with financial incentives regarding the respect of major investments schedule;
  • A moderate pricing cap (average of 1.38% per year above inflation), alongside an adjustment clause to partially compensate for the difference noted in traffic;
  • The introduction of ten ambitious service quality indicators, which may involve financial incentives in the form of bonuses and penalties, five of which directly relate to passenger satisfaction.

AdP has no plans to recruit new staff in the 2011-15 period. However, the company sees no further jobs cuts following last year’s 3.9% year-on-year reduction in staff numbers.

AdP develops and manages airports including Paris Charles de Gaulle, Paris Orly and Paris Le Bourget. The operator also holds investments and management contracts in other countries, including Cameroon, Madagascar, Guinea, Cambodia, Belgium, Mexico, Egypt and Saudi Arabia. See CAPA profile page on Aéroports de Paris for more information.

In Mexico, AdP owns a 25.5% stake in Grupo Centro Norte through OMA. Shares in OMA closed 2.9% higher yesterday. See CAPA profile page on OMA on its interests in 13 airports.

Other airport operator and investor stocks did well yesterday, including Hochtief (+4.0%) and Fraport (+3.5%), while Aeroporto di Firenze and Zurich added over 2% and Abertis, Aeroporto di Venezia and Vienna gained over 1%.

Selected airports daily share price movements (% change): 26-Jul-2010