Kansai Airports, operated by Orix and Vinci Airports, has reported a 23% decline in net profit for the interim period ended 30 September weighed down by post typhoon damages. It was the first profit decline since the company started operation of Kansai International Airport (KIX), Japan’s third busiest airport, since April 2016.
During the just-ended six-month period, the company generated a net profit of JPY 11.4bn (USD 101m) due to a JPY 3.5bn extraordinary loss related to typhoon damage, the company said in a release on Monday (10 December). In the corresponding period a year earlier, the company posted a profit of JPY14.8bn.
A powerful typhoon hit the Kansai region, causing flooding on a runway and in facilities at KIX. The airport, which sits on an artificial island, suffered multiple damages. A tanker collided with the bridge linking the airport and the mainland, stranding about 8,000 passengers and staff there overnight and leading to cancellation of many flights since then.
The natural disaster helped pull down revenue by JPY 8.2bn. But strong demand for inbound tourism until August canceled out the disaster-related revenue decline, leading to a 6% gain in interim revenue to JPY104.9bn from JPY 99.3bn. During the latest reporting period, the number of passengers using three airports operated by the company (KIX, Osaka International Airport and Kobe Airport) gained 1% to record interim high of 23.7m.
“Our earnings are in recovery trend,” due to favorable demand in and after October, said a spokesperson.
In addition, the spokesperson said the company has an insurance policy that covers both property damages and the resultant falloff in passengers after potential natural disasters, adding that the disaster-related loss now estimated at JPY 18bn for the full year ending March 2019 will be covered by the insurance arrangement.