CLARIFICATION: Kansai Airports’ contribution boosted Orix’s annual results by JPY 6bn not JPY 9bn as earlier reported.
Orix aims to bid with Vinci Airports for the concession for seven airports in Hokkaido, northern Japan, an executive at the Japanese leasing giant said on Wednesday (9 May).
“Basically, we are proceeding with the formation similar to Kansai International Airport,” said Orix deputy president and CFO Kazuo Kojima at an earnings briefing. He said that Orix plans to form a consortium with Vinci Airports and Hokkaido-based companies.
Orix partnered with Vinci to win the tender for Japan’s first large airport privatization, of Kansai International Airport (KIX) and Osaka International Airport in 2015. The company the duo formed to operate the airports – Kansai Airports – won a concession to operate Kobe Airport last year.
First rounds bids are due for the 30-year Hokkaido airport bundle concession on 16 August.
Meanwhile, Orix is also studying the possibility of bidding for other airport concessions in Japan, including Hiroshima Airport in western Japan, Kojima said. In addition, it is looking to bid for other infrastructure concessions, such as sewerage.
Airport concessions and renewable energy activities helped Orix report record earnings for the 2017-18 fiscal year.
The company’s investment and operating business segment – which includes domestic concessions and environment/energy businesses – racked up a segment profit of JPY 96.1bn (USD 881.2m).
That accounted for 22% of Orix’s pre-tax profits behind the company’s overseas business segment with a 25% share.
The 13% YoY rise for the investment and operating business segment is attributed to a JPY 6bn increase in Kansai Airports’ contribution over the period.
In addition, Orix increased renewables generating capacity in Japan to 730MW by end March 2018, from 600MW the year earlier.
Overall, Orix’s consolidated after-tax net profit rose 15% YoY to JPY 313.1bn.