Ireland West Airport Knock An airport for growth and jobs

Corporate background

• The Airport is owned by a Trust signed in 1991 by the Minister for Transport and the Airport Trustees on behalf of the people in the West

• The Trust delegated the running of the Airport to Connaught Airport Development Company Ltd (CADCO)

• An Airport to stimulate enterprise and jobs• Any dividends or profits must be re-invested in the

company (CADCO) and therefore there are no private shareholders.

355 hectare Site

2,300m Runway

7,080m2 Terminal building

6,000 mile range

CAT II ILS low visibility landing system

25 hectare Enterprise Zone

Passenger Growth: 1986 - 2012

685,000

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12

Year

Passengers

2012 was the busiest year in the airport’s history!

5% growth to 685,000 passengers

28 Destinations

Performance and efficiency

• A lean, low cost airport with small management • Flights with no operational delays 99%• Staff multi-tasking 66%• Turnover €13.6m• Government subvention in 2012 €0.58m– i.e. 4% of turnover

Origin of passengers using Airport in 2012

Source: Passenger surveys 2010 - 2012

Base = 520 responses

42%

14%

1% 1%

52%

18%

30%

21%

0%

10%

20%

30%

40%

50%

60%

2012 Survey

Good spread of counties visited by tourists from Europe in 2012

Regional Economic Return

• Direct employment 150• Jobs supported in wider region 900• Number of tourism bed nights

900,000• Regional tourism spend €111m• Employee tax/PRSI pd to Exchequer €1m• Annual contribution to GVA €17m• Regional jobs impacted by airport 6,200

The Social Dividend

New Route Development-UK

New Route Development-Europe

New Route Development-Germany

Proposals to Government in 2011/2012• Grow passenger numbers to 1.25m• Double tourism spend to

€240m• Support a total number of jobs 1,900• Increase Government tax revenues to €45m• Attract new enterprise park jobs 500

Cost of investment over 5 years €75mJoint strategic planning requested by airport for financing growth and jobs targets

Minister urges change ofGov. policy to curtail Knock “If nothing was done for Shannon the airport

stood in danger of being passed out by Knock airport in passenger numbers, despite a current gap of over 900,000 passengers …I think if the trends continue as they are it will happen because Shannon’s numbers are already down 20 per cent this year and Knock is still growing. It is only a matter of time without a change in policy.” Irish Times 31st March 2012

Government Response

• Ireland West Airport Knock is a ‘private owned entity’

• No revenue support for the airport post 2014• Refusal to engage in a joint plan• Fear that Ireland West Airport Knock will

overtake Shannon Airport in terms of passenger numbers

• Acceleration of efforts to finance Shannon Airport

Gov. Investment in Shannon

• Investment package totalling €300m • Debt financing €100m+• Transfer of annual rental income to airport €12m• Transfer of assets worth €90m • Provision of cash flow in January 2013 €6.7m• Freeing up of pension liabilities & the sale of other assets• Indication of more incentives which other airports “can apply

for” but which Shannon Airport is able to use immediately• “Shannon is in the best place to avail of any tax breaks, even if

they do apply to other airports.” Minister Varadkar 3rd Jan. 2013

Our position on Government’sdecisions on Shannon• We are supportive of Shannon Airport and its

region as part of the West of Ireland• Have a history of working in co-operation with

Shannon• However both airports compete in the same

markets• Government decision is unfair, anti-

competitive, possibly illegal and damaging Ireland West Airport Knock

Market distortion

• Government ignored its own advisors Booz and Co who evaluated the prospects for Cork and Shannon airports in 2012.

• Government was warned not to proceed with a support package for Shannon Airport without clear consideration of the competitive implications for other airports.

Shannon/Knock comparisonprior to Dec 2012 SNN package

Comparison criteria Shannon Airport

Ireland West Knock

Commercial passenger numbers 2012 1.3m 0.685m

Passenger performance in past 5 years 63% fall 20% rise

Government investment in past 10 years €160m €15m

Annual net loss levels c. €8m €0.6m

Cost per passenger of sustaining these losses €6.10 €0.87

Additional annual subvention of Air Traffic Control costs

c. €3m €0

Investment in State airports compared to KnockInvestment period State

airportsIreland West Knock

Multiple

Capital investment 2003 - 2012

DAA€1.6bn

€15m 107

Investment 2012 - 2014

Shannon€300m

€4.1m 73

Potential risks to IWA Knock

• Passenger and tourism losses 300,000• Revenue losses to region up to €240m• Direct threat to jobs 3,500• Damaged ability to attract new jobs 500• Future viability seriously threatened

An Airport for Jobs and Growth

On behalf of the Board of Ireland West Airport Knock, we

thank you for your time and look forward to working with

you into the future for the benefit of the region.