Sydney Airport Passenger Traffic Plummets

About 45 million people a year pass through Sydney Airport; that’s nearly four million people a month moving through the airport’s three terminals. But in the first half of April, those numbers were down by over 96%. Consequently, the airport’s owners, the publicly listed Sydney Airport Holdings, have moved to raise USD$538 million in short term debt. That cash will see it through the downturn in travel demand.

Sydney Airport’s passenger numbers are down by about 97%. Photo: Skatebiker via Wikimedia Commons.

Sydney Airport raises additional funds

But the airport isn’t on skid row yet. Usually flush with funds from its many revenue streams, the most recent round of fundraising via debt markets means the airport is now sitting on about USD$1.8 billion in funds.

According to Australian Aviation, that sweet little pot includes USD$272 million in available cash, USD$1.11 billion in undrawn bank facilities, and USD$380 million from the new bonds issue.

“Given the strength of our balance sheet and liquidity position, at this time, we do not see the need to raise equity.” an airport spokesperson said.

The airport has USD$820 million in loan repayments due over the next 12 months. It is now in a position to cover this easily.

Passenger traffic in freefall

Passenger traffic had been decreasing significantly in recent months on the back of the worldwide travel downturn. In March, passenger traffic at Sydney was down 45%.

But as airlines slashed flights, the numbers deteriorated further in April. Passenger traffic through the two domestic terminals at Sydney is now down 97.4%. Passenger traffic through the ordinarily bustling international terminal is down 96.1%.

Sydney is usually the busiest airport in Australia. Terminal Two, one of the domestic terminals, is the busiest in Australia. Virgin Australia, Tigerair, Jetstar, and commuter airlines such as REX normally use that terminal.

Sydney Airport is expected to remain quiet for some time. Photo: Sydney Airport.

In recent weeks, the terminal has resembled a ghost town as the airlines either grounded their entire fleets or operated the slimmest of services. At one point, Virgin Australia was down to one service a day from the terminal.

Across at the tarmac at Terminal One, the international terminal is usually served by 40 plus airlines who carry nearly 17 million passengers annually. There are now only a handful of international airlines servicing Sydney. Passenger traffic from the USA has almost halved. Passenger numbers from Japan are down 64%, and China is down 70%.

Sydney Airport moves to assist employees and tenants

Sydney Airport’s owners, who are often accused of being avaricious, are coming to the party to assist their employees and many commercial and retail tenants.

The airport has promised all its employees that their jobs are safe for at least six months. All employees remain on full pay. Sydney Airport Holdings directors have reduced their fees by 20% from the start of April.

Sydney Airport’s owners are moving to support employees and tenants. Photo: Jnpet via Wikimedia Commons.

Also, the airport is working with its tenants. Noting that this was a team effort, Sydney Airport’s CEO Geoff Culbert said this week;

“We are working closely with our airlines and commercial partners to make sure everyone has the best shot of making it through to the other side while continuing to operate the airport as an essential service.”

Sydney Airport expects low passenger numbers for the immediate future. There is some hope domestic travel will slowly begin to recover over the southern hemisphere 2020 winter. Passenger numbers through the international terminal are expected to remain subdued for considerably longer.