High regulatory costs to weigh on Fraport’s income, passenger numbers this year, BA

Frankfurt Airport operator Fraport forecast on Tuesday only a moderate increase in its 2025 core income and passenger traffic, after missing full-year core income estimates because regulatory costs were higher and people traveled less towards the end of the year.

Shares in Fraport were down 3.2 per cent in early trade. The company said it expects its earnings before interest, tax, depreciation and amortisation (EBITDA) in 2025 to increase moderately, and decided again not to propose an annual dividend due to continued high debt levels.

The EBITDA outlook implies a 2 per cent cut to consensus, Jefferies analyst Graham Hunt wrote in a note, adding the decision to pay out no dividends was a “disappointment”.

Fraport generated core income of 1.3 billion euros in the fiscal year 2024, just missing analysts’ consensus of 1.31 billion. The company forecast 2025 passenger numbers in Frankfurt to be 64 million versus 61.6 million in 2024.

In October, CEO Stefan Schulte had said Fankfurt airport would reach its pre-COVID passenger traffic levels in 2025 or 2026 as its recovery largely depends on Boeing deliveries to Lufthansa. The latter accounted for more than 60 per cent of Frankfurt’s passengers in 2022.

But Schulte said on Tuesday that new aircraft bottlenecks and excessively high regulatory costs continue to be a major factors in slower passenger traffic recovery.

“If no political action is taken, costs imposed by regulators will further increase in 2025,” Schulte added in a statement.

Jens Bischof, president of the German Aviation Association (BDL), said in February that another year of record-high location costs for airlines could put Germany at risk of losing competitiveness in the sector. Fraport stock rose 15 per cent in the 6 months to March 13, outperforming its peers.