Annual Report 2003 - Flughafen München

Transcription

Annual Report
2003
xx
Introduction
Foreword
Chronicle
Executive board and directors
Ten-year overview
3
4
6
7
The airport in figures
Key figures
Munich in comparison
9
9
Flughafen München GmbH
in 2003
General development
Passenger traffic
Air freight and air mail
Business performance
Non-aviation business
Personnel
Subsidiaries and associated companies
Environmental protection
Corporate communications
Marketing
10
14
18
20
24
28
32
36
38
40
The inauguration of Terminal 2
42
2003 year-end accounts
Management’s review
Annex
Supervisory board’s report
Balance sheet
Income statement
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51
59
60
62
2
Foreword
For Munich Airport, 2003 was a milestone year in
more than one regard: With Terminal 2’s successful start on June 29, we finally elevated Munich
into the Champions’ League of aviation. At the
same time, we embarked on our M-Power project, which sets out to restructure our group of
companies and pave the way for the future.
As the traffic figures for the past year demonstrate, Munich remains one of those airports
capable of exceptionally rapid growth. With
around 24.2 million passengers in 2003, Munich
Airport recorded roughly a million more movements than a year earlier. The number of takeoffs
and landings, too, climbed to a new all-time
high at roughly 343,000.
This strong performance put Munich International back in eighth place in the rankings of
Europe’s leading commercial airports, in spite of
the persistently difficult geopolitical and economic circumstances. Such factors as the war in
Iraq, fears of terrorism, SARS, the slow global
economy, and lackluster consumer demand
impacted heavily on the air transport sector. And
while several aviation hubs among Europe’s top
ten reported flat or declining passenger volumes, Munich was able to record substantial
growth.
Thanks to Terminal 2 and the fact that it has doubled our handling capacity to 50 million passenger a year, we will be in an optimum position to
capitalize on future opportunities presented by
the aviation marketplace.
Munich offers airlines the conditions they need
for long-term growth: a runway system with
considerable development potential, two exceptionally modern and well-designed terminal
buildings with enormous capacity reserves, and
a hub structure that ranks Munich as an ideal
gateway to Europe.
At the same time, the FMG Group will also be fit
for the future. With M-Power, our project to overhaul group strategy and raise profitability, we
will re-frame our organizational structure to
align with the changes that have already taken
place in our infrastructure and to gear up for the
challenges we will face in the years ahead. We
can only continue to build on our successes of
decades past if we ensure that we are consistently able to respond rapidly to our market’s
constantly changing needs and expectations.
Flexibility and adaptability have always been
fundamental prerequisites for success in the aviation sector. Those who fail to adapt sufficiently
fast to its changing conditions and requirements
pose a threat to their own survival in the longer
term. This is a hard lesson that a number of
high-profile airline companies have had to learn
in recent years. And it’s a harsh fact of life for
airports, too: Once state-run facilities, they have
long since had to transform into business enterprises, and today face enormous competitive
pressures.
This is exactly where M-Power comes in, our
second big milestone in fiscal 2003. We want to
be ready to meet future challenges head-on, and
I’m confident we will be. We also want to accomplish the same quantum leap forward at an organizational and strategic level that we have already achieved with the doubling of our capacity. Then, Munich Airport will be truly ready for
the tasks and opportunities that lie ahead.
The fact that Munich International completed the
past year as successfully as it did is primarily a
tribute to the immense dedication of our employees, and to them I extend my sincere thanks.
My thanks also go to our shareholders for the
clear and unambiguous line they have pursued,
a line that has given us the necessary backing
and support to grow into one of the foremost
hub airports in Europe.
Dr. Michael Kerkloh
President and CEO,
3
Chronicle
January 9, 2003
The final countdown begins for Munich Airport’s
new Terminal 2, built and operated by Flughafen
München GmbH (FMG) and Deutsche Lufthansa
AG. In preparation for the start of operations, all
of the crucial handling infrastructure – the baggage transportation system, IT equipment, the
check-in desks, and other installations – are put
through a trial run lasting several months, during
which some 3,600 “extras” play the part of
Terminal 2’s first passengers. The goal of the trial
operations is to simulate as closely as possible
real-life passenger, baggage, and aircraft handling
processes. At the same time, FMG and Lufthansa
employees who will be working at Terminal 2 and
its ramp area are put through internal training
programs to familiarize them with the new equipment, operational procedures, and the topography
of the airport’s new facility.
February 12, 2003
At the annual press conference, Flughafen München GmbH’s executive board presents the traffic
figures and operating results for 2002. In spite the
difficult overall business and economic climate
and the after-effects of the terrorist attacks of
September 11, 2001, passenger movements were
just 2 percent lower than a year earlier, at roughly
23.2 million. As for the number of takeoffs and
landings, the airport was able to report a new alltime high of almost 331,000 commercial aircraft
movements, 2.8 percent more than in the prior
year.
March 30, 2003
Airlines had coordinated over 234,00 aircraft
movements – roughly 13 percent more than a
year earlier – for the summer timetable. With the
start of the summer season, Deutsche Lufthansa
further expands its hub operations in Munich,
offering a total of three new and attractive longhaul routes, to New York (Newark), Beijing, and
4
Montreal. The carrier also ups the frequencies on
its long-haul services to Shanghai and Hong Kong
to seven and six flights a week, respectively. In
addition, Lufthansa begins operating its daily service to Los Angeles again, which had been discontinued temporarily following the events of
September 11, 2001. The Canadian carrier Air
Transat launches a weekly service to Toronto, and
Emirates begins operating two flights a day to
Dubai.
April 3, 2003
Following a pilot phase that began in October
2001 in which air travelers with suitably equipped
laptop and handheld computers were given
wireless Internet access in Munich Airport’s terminal and main concourse, Flughafen München
GmbH decides to expand the new service in
association with Cisco Systems: Munich Airport
becomes the world’s first wireless LAN “hotspot” to deploy a so-called multi-service-provider system. From a start page, users can choose
from a range of service providers and are then
charged by the provider in question for the network service. Access to Munich Airport’s own
web pages, however, is free.
June 3, 2003
AirportClinic M, a new healthcare facility operated by MediCare Flughafen München Medizinisches Zentrum GmbH, opens. Initially planned
as a surgery center for outpatients and shortstay patients, the eight-bed clinic is fitted out
with the most advanced medical equipment and
designed for exceptional comfort. The doctors
who will be using the center to conduct operations include specialists in orthopedics, hand
surgery, plastic surgery, ophthalmology, and ear,
nose, throat and oral surgery. The private clinic
had successfully completed a trial period lasting
several months, during which 500 operations
were carried out.
June 27, 2003
Almost three-and-a-half years after the start of
construction work and two days before beginning live operations, Munich Airport’s new
Terminal 2 is inaugurated in an official ceremony
attended by more than 2,500 guests of honor.
The new facility, which will double the airport’s
handling capacity to 50 million passengers a
year, is a joint enterprise undertaken by Flughafen München GmbH (FMG) and Deutsche Lufthansa AG. Lufthansa, which is to have exclusive
use of the new passenger handling facility along
with fellow Star Alliance members and other
partner airlines, is planning to develop Munich
Airport and Terminal 2 as a key hub in its international route network.
June 29, 2003
Terminal 2 kicks off at Munich Airport: During its
first day in service, the new facility handles
around 600 of a total of almost 900 aircraft
movements at the airport. The first flight is by a
Thomas Cook Airlines Airbus A 320, bound for
Rhodes, which departs at 5:10 am. The first plane
to dock at the new terminal is a Qatar Airways
Airbus A 300, inbound from Doha in the United
Arab Emirates, which arrives on block at 6:30
am. During the first day’s operation, roughly
50,000 passengers are acquainted with the new
terminal, its modern handling facilities, and its
attractive offering of stores and restaurants.
July 24, 2003
Following the commissioning of Terminal 2 and
Lufthansa’s relocation there, Terminal 1 has plenty of attractive free space for use by other airlines. Internal reorganization of Terminal 1 will
align it better with the needs of the companies
operating there and will allow carriers to be
grouped together based on similar service profiles.
September 2003
Flughafen München GmbH offers some 2,800
households in the airport’s surrounding area
which the company had already fitted out with
anti-noise glazing between 1992 and 1997 the
opportunity to take part in a service program to
have window fittings adjusted and minor parts
replaced so as to ensure optimum protection
against noise.
October 7, 2003
Munich Airport hosts the 14th Inter Airport
Europe, the world’s premier industry show for
airport equipment, technology and services, for
the third time in succession. In 22,000 square
meters of exhibition space in Hangar 4 and the
adjacent outdoor area, some 500 exhibitors from
24 countries show a range of advanced airport
technology for an audience of industry professionals.
October 26, 2003
Airlines had previously coordinated around
151,000 takeoffs and landings for the winter
timetable at Munich Airport. With the start of the
winter season, Lufthansa begins operating its
first nonstop service from Munich to Dubai, flying five times a week. Emirates too steps up its
offering to Dubai to two flights a day. Qatar
Airways flies four times a week to Doha, the
capital of the sheikdom Qatar. Lufthansa operates a daily flight to Miami in the U.S. and resumes its service from Munich to Johannesburg
and Cape Town with six frequencies a week.
Following the end of the SARS crisis, the carrier
also steps up its services on the MunichShanghai route from three to five frequencies a
week and begins offering six flights a week to
Tokyo. In contrast to previous practice in past
winter seasons, Lufthansa continues operating
its service to Los Angeles rather than suspending it, but with a reduced offering of three flights
a week. Services to New York and San Francisco
are also kept in the winter program with five and
three frequencies a week, respectively.
5
Executive board
Directors
Dr. Michael Kerkloh
President and Chief Executive Officer
Personnel Industrial Relations Director
Walter Vill
Vice President and Chief Financial Officer
Peter Trautmann
Chief Operating Officer
Johann Bernhard
Technics and Facilities (from August 1, 2003)
Dr. Brigitte Englert
Corporate Planning and Strategy
Florian Fischer
Masterplanning and
Environmental Management
Wolfgang Hammerstädt
Operations
Andreas von Puttkamer
Marketing and Traffic Development
Thomas Ross
Legal Affairs and Security
Thomas Scheidler
Personnel
Dr. Karl Heinz Schwarzmeier
Finance and Accounting
(from left to right)
6
360
650
26
350
625
25
340
60 0
24
280
14
250
240
220
12
275
11
20 0
250
10
190
225
9
03
210
180
94 95 96 97 98 99 0 0 01 02
321,756
230
30 0
94 95 96 97 98 99 0 0 01 02
253,109
15
260
03
218,154
16
262,446
270
280,067
290
302,412
21.28
30 0
19.32
17
13
310
17.89
18
320
199,114
23.13
555.5
19
330
186,176
325
361.2
350
350.9
375
20
388.3
40 0
21
15.69
425
22
14.87
442.9
450
455.6
475
23
13.25
50 0
494.0
525
529.8
550
557.5
575
343,027
27
24.19
commercial traffic* (thousand)
675
23.65
Aircraft movements
commercial traffic (million)
23.16
Passengers (in + out + transit)
(€ million)
593.3
Sales
330,888
Ten-year overview
94 95 96 97 98 99 0 0 01 02 03
* excluding ferry flights
7
8
The airport in figures
Air traffic
2003
2002
2003 / 2002
24,214,250
23,188,478
+ 4.4 %
– Commercial traffic
24,193,304
23,163,720
+ 4.4 %
– Scheduled and charter traffic
24,168,967
23,138,053
+ 4.5 %
Aircraft movements (total)
355,602
344,405
+ 3.3 %
– Commercial traffic
343,027
330,888
+ 3.7 %
– Scheduled and charter traffic
332,991
320,315
+ 4.0 %
Air freight handled (total, t)
246,585
245,398
+ 0.5 %
– Carried by air (t)
140,585
144,398
– 2.6 %
– Carried by truck (t)
106,000
101,000
+ 5.0 %
Air mail handled (t)
21,960
22,486
– 2.3 %
9,545,117
9,377,005
+ 1.8 %
Passenger movements (total)
Maximum takeoff weight (MTOW)
in commercial and non-commercial
traffic (t)
Net sales
2003
2002
2003 / 2002
(€ million)
593.3
555.5
+ 6.8 %
Personnel
2003
2002
2003 / 2002
Personnel costs
(€ million)
220.6
193.7
+ 13.9 %
Employees
(at Dec. 31, 2003)
4,891
4,568
+ 7.1 %
Average employee
capacity
4,253
3,953
+ 7.6 %
Munich in comparison
Traffic figures for German airports in 2003
Passenger figures for Europe’s top ten airports
in 2003 (commercial sector)
(commercial sector)
Passengers
(in + out + transit)
Aircraft
movements
Air freight (t)
Air mail (t)
Frankfurt
48,351,664
450,797
1,527,170
123,428
Munich
24,193,304
343,027
140,585
21,960
Düsseldorf
14,273,082
174,113
47,368
120
Berlin (total)
Ranking
Passengers
(million)
2003 / 2002
London
Heathrow
1
63.5
+ 0.2 %
Frankfurt /
Main
2
48.4
– 0.2 %
13,306,177
188,295
25,614
4,907
Hamburg
9,529,924
126,878
23,195
12,773
Cologne / Bonn
7,758,655
139,872
518,493
12,632
Stuttgart
7,584,502
123,056
17,457
9,948
Paris
Charles de
Gaulle
3
48.1
– 0.4 %
Hanover
5,044,870
74,960
5,334
9,868
Amsterdam
4
40.0
– 1.9 %
Nuremberg
3,290,299
56,423
10,258
4,599
Madrid
5
35.7
+ 5.2 %
Leipzig / Halle
1,951,121
31,833
9,308
6,499
Bremen
1,639,834
33,174
1,162
1,075
London
Gatwick
6
30.0
+ 1.3 %
Dresden
1,553,774
25,134
643
0
Münster /
Osnabrück
Rome
Fiumicino
7
26.3
+ 3.7 %
1,512,786
34,168
91
667
Munich
8
24.2
+ 4.4 %
Dortmund
1,023,329
29,788
96
0
Barcelona
9
22.8
+ 6.6 %
Erfurt
464,681
12,965
3,495
0
Paris Orly
10
22.4
– 3.3 %
Saarbrücken
458,183
11,633
372
0
141,936,185
1,856,116
2,330,641
208,476
Total
Source: Airports Council International (ACI)
Status: March 2004
Source: German Airports Association (ADV)
9
General development
With almost 24.2 million passenger movements
in the commercial sector – over a million or 4.4
percent more than a year earlier – Munich Airport
achieved a record result in 2003. So in spite of
the difficult conditions in the aviation industry –
including the war in Iraq, SARS, and continued
slowness in the economy – the airport was able
to achieve a return to past form and solid
growth.
10
Munich now eighth among the top ten
Thanks to these strong passenger figures,
Munich was one of the few airports among
Europe’s top ten that managed to report substantial growth, and succeeded as a result in
moving up the rankings to the number eight
slot, from ninth place in 2002. The number of
takeoffs and landings by commercial traffic at
Munich International also reached a new all-time
high. Aircraft movements in this sector grew 3.7
percent, year over year, to around 343,000.
Munich’s increasing importance as a European
aviation hub is underscored by the good results
in international traffic. Compared to domestic
German and European traffic, this segment
showed strong growth, recording 11.1 percent
more passengers and 14.0 percent more flights.
Parallel to the rise in intercontinental traffic, the
number of transfers at Munich Airport, too, has
increased. In the case of Lufthansa’s passenger
traffic, the transfer volume has already reached
43 percent. Transfers currently account for 31
percent of the airport’s total passenger volume.
Terminal 2: Ideal for hub traffic
Playing a major role in Munich’s hub operations
now is the new Terminal 2, which opened on
June 29, 2003, and was built as a joint project by
Flughafen München GmbH and Deutsche
Lufthansa AG. From the very beginning, the new
facility fulfilled the purpose for which it had
been built – to provide a more efficient distribution point for Lufthansa’s and its partners’ transfer traffic. Thanks to the new terminal, which
enables air travelers to switch flights in as little
as 30 minutes, Munich Airport has effectively
doubled its handling capacity to 50 million passengers a year. Important tasks ahead include
further expanding hub operations in Terminal 2
and optimizing the facilities in Terminal 1, which
is especially well-suited to point-to-point traffic.
Given that Deutsche Lufthansa and its partner
airlines have now moved to Terminal 2, the airport operators can allocate and configure the
space that has been freed up in Terminal 1 in line
with carriers’ needs and offer them flexible, individually tailored solutions. With its two highly
modern terminals, each purpose-built to service a
specific type of traffic, Munich Airport is ideally
equipped to compete effectively in the international aviation arena.
More than 91,000 passengers in one day
Munich International’s busiest day in terms of
passengers in 2003 was September 26, with
91,248 movements on commercial flights, compared to a maximum of 90,882 passengers in
one day in 2002. On average, the airport recorded 66,283 passenger movements a day, up
from 63,462 in 2002. The greatest number of
takeoffs and landings in the commercial sector
in a single day was registered on March 20,
2003, when movements totaled 1,088 (the maximum in 2002 was 1,095 in one day). The average
number of aircraft movements a day over the
year was 940, compared to 907 in 2002. In 2003,
104 airlines operated scheduled and packagetour services on a regular basis at Munich
Airport. They served 24 domestic destinations
and 199 international destinations in a total of 63
countries. Although scheduled and charter services’ on-time rate slipped marginally year on
year from 83.5 percent to 81.8 percent, punctuality was nevertheless substantially better than in
2001 (77.8 percent) and marked one of the best
results ever achieved at the airport’s new location.
11
Almost all jets classed as quiet or very quiet
Of the 343,027 takeoffs and landings in the commercial sector, 271,001 were movements by jet
aircraft. Almost all of these jets met the requirements in ICAO Annex 16, Chapter 3, to qualify as
quiet. In fact, 96.9 percent of all jets were classed
as especially low-noise aircraft and qualified for
a bonus; 3.1 percent were classed as Chapter 3
aircraft but without a bonus certificate. An almost negligible number of movements – fewer
than 0.1 percent – were by jets in the Chapter 2
category. The maximum takeoff weight (MTOW)
in scheduled and charter traffic increased by 1.8
percent in 2003 to 9,325,993 metric tons in total.
At the same time, the average MTOW per flight
dropped by 1.2 tons to 56.0 tons.
12
Intercontinental traffic expands fastest
Whereas 62.4 percent of all scheduled and charter flights were international services to and
from countries in Europe, 33.9 percent were services on domestic routes and 3.7 percent were
international flights. The latter showed the greatest rate of increase in 2003. In absolute figures,
movements in each segment were as follows: As
in past years, domestic traffic, with 113,000
flights, accounted for one-third of all movements
in 2003; two-thirds, or 220,000 flights, were
cross-border services. Of the international
flights, 147,000 were on routes to and from
countries in the European, compared to 60,000
in other continental traffic – in other words,
flights to and from non-EU countries in Europe
and littoral Mediterranean states in Africa and
Asia. A further 12,000 were on intercontinental
routes. In 2003, routes to and from Italy recorded the highest number of flights with almost
40,000 takeoffs and landings; Italy also scored
the greatest absolute increase in the number of
aircraft movements. France and Britain ranked
second and third among the countries with the
heaviest traffic.
Sharp increase in landing fee revenue
Sharp increase in landing fee revenue
Landing-fee revenue rose markedly by 5.6 percent to €195 million in 2003. This was partly due
to price adjustments in October 2002 and
October 2003, but was also the result of a 4.4
percent increase in passenger numbers and a
3.7 percent rise in the number of aircraft movements in the commercial sector. Up 11 percent,
revenue from passenger-dependent landing fees
grew faster than revenue from weight-dependent fees. This was due to a shift in the fee structure away from fixed landing fees in favor of
variable charges.
Revenue from ramp services dropped by 7.3 percent, but largely on account of a change in booking procedure. Revenue generated by the central
infrastructure (for example, the baggage transportation system) in Terminal 2 goes to Flughafen München GmbH’s affiliate Terminal 2-Betriebsgesellschaft, the terminal’s operating company, and is therefore not included in FMG’s
own yearend accounts.
13
Passenger traffic
In 2003, Munich Airport recorded almost 24.2
million passenger movements in the commercial sector, compared to 24,214,250 in total
across all traffic segments. In both cases, numbers were up 4.4 percent on the previous year.
14
A plus in intercontinental traffic
Growth in intercontinental traffic, which accounted for 9.1 percent of the overall volume, was
particularly strong. In total, close to 2.2 million
passengers were carried on long-haul flights to
and from Munich – 11.1 percent more than in the
year before. However, this growth was achieved
solely on North Atlantic routes. Here the passenger volume was up more than 26 percent, year
on year. This more than offset the low passenger
volumes on traffic to and from Africa – caused
by the political situation and terrorist activity in
Kenya – and Asia as a result of the SARS crisis.
New services operated by Lufthansa to Dubai,
Miami, Newark, and Montreal all played a prominent part in the boom in long-haul traffic. In
2004, too, Lufthansa is continuing initiatives to
widen its hub operations with the introduction of
new long-haul services to Charlotte, Teheran,
Delhi, Beijing, and Canton.
More air travelers bound for all destination
regions
The greatest absolute number of passenger
movements, 9.4 million, was recorded on services to and from countries of the European
Union. Growing at a rate of 5.1 percent in 2003,
the EU countries achieved greater-than-average
gains. Traffic on other continental routes also
expanded, growing 3.4 percent to a total of 3.9
million passengers. Here, countries in Eastern
Europe showed especially strong growth. On
domestic routes in Germany, passenger movements totaled 8.5 million – 3.0 percent more
than a year earlier.
Spain records growth at 11.3 percent
In 2003, Spain, once again was number one
among the countries with the highest passenger
volumes, recording more than 2 million passenger movements – a sharp 11.3 percent gain in
comparison with 2002. Behind Spain in the rankings came Italy (with 1.69 million passengers),
the United Kingdom (1.58 million), France (1.14
million) and Turkey (1.13 million).
15
London Heathrow and Berlin Tegel lead the pack
Just as in 2002, the airports with the heaviest
traffic to and from Munich were London
Heathrow, with around 850,000 passengers, and
Paris Charles de Gaulle, with over 595,000.
Palma de Mallorca achieved the fastest growth
at 29.6 percent, moving up the rankings from
sixth place in 2002 to third in 2003 with more
than 451,000 passengers. These airports were
followed by Antalya with 433,000 passengers,
Amsterdam with 383,000, and Rome Fiumicino
with 365,000, which saw a year-on-year gain of
10.2 percent. Top-ranked once again among
domestic destinations was Berlin Tegel with
almost 1.54 million passengers (4.8 percent
more than a year earlier). Passenger movements
16
to and from Hamburg grew even faster at 10.1
percent to total 1.43 million, moving the city
from fourth to second place in the rankings in
2003. Next came Düsseldorf with 1.40 million
passengers, Frankfurt with 1.37 million, and
Cologne/Bonn with almost 955,000.
Marked rise in passenger-dependent landing fees
The airport’s earnings from passenger-dependent landing fees grew 11 percent to €99 million. This increase came about as a result of
three main factors: passenger growth running at
4.4 percent, price adjustments introduced on
October 1, 2002, and on October 1, 2003, and a
shift in the pricing structure away from fixed
charges in favor of variable landing fees.
17
Air freight and air mail
The volume of air freight transshipped was marginally higher in 2003, up 0.5 percent on its yearearlier level. In total, Munich handled 246,585
metric tons of cargo, a new record for the airport. Although the volume of flown freight
slipped by 2.6 percent to 140,585 tons, freight
carried by truck rose to 106,000 tons, a year-overyear gain of 5 percent.
18
A review of the volumes handled over the year
reveals that the quantity of freight transshipped
grew rapidly during the first three months of
2003 but then dropped sharply, above all on
account of the SARS crisis. However, the losses
sustained in the intercontinental cargo traffic segment were offset by rising freight volumes on
routes to and from North America and Dubai. At
the same time, cargo traffic to and from airports
on the European continent stagnated, and freight
volumes on domestic flights to and from Munich
actually plunged by almost one-fifth.
Bellyhold freight increased
Whereas the volume of bellyhold freight as a
percentage of total freight increased to roughly
75 percent from over 70 percent in 2002, the
quantity of goods on freight-only services slid to
roughly 25 percent, from close on 30 percent a
year earlier. Export freight dropped by 6.5 percent, accounting for 55 percent of the total quantity transshipped in 2003, whereas import freight
grew 2.5 percent to account for 45 percent of the
total cargo volume.
A continued decline in air mail
The quantity of air mail handled dropped by 2.3
percent, or 526 tons to 21,960 tons in 2003. This
decline is partly due to increasing use of new
communication media and partly to the express
carriers competing with Deutsche Post AG. The
air mail that they carry appears in the statistics
as air cargo.
19
Business performance
Sales revenues higher in spite of transfers to
Terminal 2 Betriebsgesellschaft
In 2003, Flughafen München GmbH’s net sales
grew by 6.8 percent to €593 million. Even
though a number of revenue sources were transferred to our subsidiary Terminal 2 Betriebsgesellschaft (T2-BG), our revenues remained at
their year-earlier level. Revenues from central
infrastructure provisioning in Terminal 2 were
booked to T2-BG.
20
Proceeds in the non-aviation sector rose a sharp
17 percent. This increase is due primarily to general service revenues and income from utilities
and supply services. General service revenues
were mainly generated by the provision of services to T2-BG (above all, facility management).
Utility and supply service revenues also increased
substantially as a result of providing Terminal 2
with power, heat and cooling. We registered a
decline in sales-related rents because these were
partially charged in Terminal 2 rather than Terminal 1 and were therefore booked to T2-BG.
Other operating income increases
At €30 million, other operating income (including
own work capitalized) was substantially higher
than a year earlier. This increase was due to the
sale of a plot of land in Munich-Riem. However,
this earnings item was booked in full as a special
reserve item (see other operating expenses).
Operating costs grow faster than sales
Operating costs, including leasing costs, grew 18
percent in the past fiscal year – much faster than
sales (6.8 percent). This was on account of the
commissioning of Terminal 2.
Terminal 2 sends materials costs higher
In comparison with 2002, the costs of outside
purchases of goods and services increased
sharply by 45 percent, to €160 million. Materials
costs partly include revenue from variable landing fees transferred to T2-BG from mid-2003
(€31 million). In addition, Flughafen München
GmbH provides a complete range of facility
management services to Terminal 2, as a result
of which costs of third-party services for building
cleaning and maintenance went up accordingly.
In addition, energy charges for the supply of
Terminal 2 with power, heat, and cooling increased.
A further rise in personnel expense
Largely on account of the commissioning of
Terminal 2, FMG’s human-resource capacity
expanded by almost 8 percent to 4,253 employees (averaged out over the year). Personnel
expense also rose as a result of a high collectively agreed 14 percent increase in pay for
public-service workers.
Lower write-downs
In 2003, write-downs declined 7 percent in comparison with 2002. The fact that Munich Airport
began operating at its new location on June 1,
1992, means many capital goods with a useful
life of ten years are now fully written off.
21
Special effects drive other operating expense
higher
Other operating expense, including leasing
charges but excluding taxes, increased by 23
percent, to €137 million. One reason for the
increase was the sale of a plot of land at MunichRiem, which was booked as a special reserve
item and therefore affected costs. Another reason were provisions necessitated, among other
things, by the insolvency of Aero Lloyd. In addition, insurance premiums were higher.
Decline in operating profit
The commissioning and operation of the airport’s
second terminal had a sizeable impact on our
bottom line. Compared to a year earlier, our operating profit (not including our non-operating
result) dropped by around €60 million, to €7
million. If, counter to standard practice in financial reporting, we disregard the €47 million in
leasing payments because, from a business
point of view, these constitute financial expenditure, we effectively achieved an operating result
of around €54 million.
22
Net income lower
Pre-operating, operating and financial costs in
connection with Terminal 2 also had a strong
impact on our net income. For the first time
since 1995, Flughafen München GmbH has had
to report a loss: €51 million for 2003. A year earlier, the company posted profits of €14 million
(before payment of interest to shareholders).
Besides the decline in operating profit, our net
investment income contributed to the net loss
for the year. The net result from investments
includes the financing and start-up costs for
Terminal 2. Our subsidiary Terminal 2 Immobilienverwaltungsgesellschaft is responsible for
financing Terminal 2, whereas operation of the
terminal is the responsibility of a separate company, T2-Betriebsgesellschaft. Deutsche Lufthansa AG has a stake of 40 percent in each of these
companies. The losses made by these two companies are to be carried by Flughafen München
GmbH and Deutsche Lufthansa AG proportionally at a ratio of 60:40. In spite of the negative
national economic and global political circumstances during the past year, our net result for
fiscal 2003 was better than originally expected.
23
Non-aviation business
Shopping at Munich Airport
With the opening of Terminal 2, not just the travel opportunities improved thanks to the large
number of new flights available; shopping at
Munich Airport, too, became altogether a richer
experience. The addition of Terminal 2 brought
with it a total of 110 new shops and restaurants,
spread over three floors of the building. The
immense range of retailers – major, worldfamous brands interspersed with long-standing
local companies – and the wide choice of places
to eat reflect both Munich’s international orientation as a transport hub and its firm attachment
with its Bavarian roots. The mix of retailers and
the positioning of stores and places to dine were
chosen with care to suit the anticipated flow of
passengers through the building. In contrast to
Terminal 1, Terminal 2 concentrates its commercial offering in the non-public area, in other
words in the zone beyond the passenger and
hand-luggage security checkpoints. Transfer passengers in the new terminal have access to
around 70 percent of the building’s stores, cafés
and restaurants.
24
Offerings for airport visitors and employees
The commercial offering in the new terminal’s
public area, by contrast, targets not just air travelers but also meeters and greeters, visitors, and
airport employees. On level 03, the same level
as the Forum in the München Airport Center
(MAC), you find Travel Market 4, which concentrates on serving the needs of Deutsche Lufthansa AG’s and partner airlines’ business traveler customer segment. Together with Travel
Markets 1 through 3, there are now 60 travel
agents’ and tour operators’ offices at Munich
Airport, covering an overall area measuring
some 1,500 square meters. The retail offering on
level 03 of the new terminal, the level frequented by all arriving passengers and those outbound air travelers who come to the airport by
rapid transit railway, includes a supermarket carrying a range of goods tailored to their needs,
plus a number of specialty stores selling bakery
products, fashion articles, and gift items. On the
arrivals level, there is a sports bar, complete
with TV screens running broadcasts of sporting
events, where air travelers, meeters and greeters, and airport visitors can stop by for refreshments. Rounding out the offering are a number
of juice and coffee bars.
International and Bavarian
Also open to the public are several of spacious,
open-plan restaurants located on gallery level 05
in the departure hall. These restaurants reflect
the same mix of international flair and local
Bavarian color that shapes the commercial offering in general throughout the facility. The retail
and hospitality mix in the public area was planned specifically to complement and extend the
range of stores and restaurants to be found on
the same level in the MAC. The businesses located there today are widely known throughout
the local area and are becoming increasingly
popular. This development has been underpinned by an extensive range of marketing initiatives in combination with family-oriented
events held in the München Airport Center’s
Forum. In 2003, the Christmas Market (the sixth
to take place at the airport) in particular benefited from its location in between two bustling airport terminals, and recorded higher numbers of
visitors than at any time previously.
Online travel agent expands services
The Internet travel portal www.munich-airportreisen.de, launched successfully in 2001, was
extended in 2003 to support the online booking
of last-minute and all-inclusive holidays, charter
flights, and worldwide hotel reservations, and
now includes travel videos and a travel pharmacy. Country and weather information for travel
destinations plus hotel ratings round out the
offering. The monthly newsletter eVIEWS spotlights events, retail and hospitality offerings,
new flight destinations, and current specials in
the airport’s Travel Value and duty free stores, the
travel portal, and the online shop. In addition,
each month the site offers visitors the chance to
win shopping vouchers and free tickets for selected events. As of November, all perfume and
cosmetics goods available on site at the airport
can now be purchased online, too, through the
redesigned web shop at www.munich-airportshopping.de. Users can also order current merchandise from the Kollektion M line. There is no
shipping charge on any of the goods sold
through the online shop.
25
Airport timetable for PDAs and Pocket PCs
To complement the electronic airport timetable
published as a PDF document, the airport began
offering a timetable for PDAs and Pocket PCs in
December 2003. Owners of these mobile devices
can download current data on all flights to and
from Munich at www.munich-airport.de/pda,
complete with arrival and departure times, airlines, flight numbers, and check-in information.
Users can copy specific flight information
straight into their personal calendars. In 2003, all
of the waiting areas in the two terminals, all the
lounges, the “municon” conference center, the
Hotel Kempinski Airport München, and the MAC
Forum were kitted out with W-LAN technology to
provider airport users with wireless Internet
access. The service is charged for through contractual partners T-Mobile, Swisscom and
Vodafone by means of vouchers, credit cards or
users’ regular mobile phone bills.
High tenancy rate in the MAC
In spite of the generally poor situation in the
market for business real estate in Munich and
the airport’s surrounding area and the often
more affordable asking prices for competing
property, the MAC was able to maintain a high
tenancy rate of more than 90 percent in 2003. In
contrast to the general downward trend in consumer spending, business was solid for the
commercial tenants in the MAC, and some even
succeeded in increasing annual sales. The medical center in the southern part of the München
Airport Center in 2003 again proved popular,
attracting an even higher number of patients.
This was partly due to the intensive collaboration with AirportClinic M, operated by FMG subsidiary MediCare, which is part-owned by doc-
26
tors who work in the MAC. In the first half of
2004, a gynecologist and a urologist joined the
team of doctors and health practitioners already
working in the center, who include a general
practitioner and internist specializing in natural
healing, an ophthalmologist with a laser center,
an orthopedist, a radiological diagnostic center,
dentists (including a specialist in implantology),
and a physiotherapist.
New advertising space in Terminal 2
Deutsche Lufthansa AG’s and Flughafen München GmbH’s joint Terminal 2 project has also
created exceptional new opportunities for marketing advertising space: New advertising vehicles and innovative media, in combination with
Lufthansa passengers as an upscale target
group, have created the right foundation for successful marketing of new ad space in Terminal 2.
Exclusive, large-scale projects, such as the BMW
air-space sculpture in the main check-in hall and
the HVB Group’s brightly colored information
tower at the south curbside, continue the trend
in highly individual advertising that has long
since been a hallmark of Terminal 1. The distinctive parallelogram format used for wallmounted ad space also features prominently at
the new terminal, as do standard media typically
in demand among advertisers, such as illuminated boxes located in the baggage claim areas.
One recent and important innovation is a terminal-wide airport TV system: More than 30 largeformat screens deliver specially compiled programming comprising current news, stock market information, and a range of special reports.
Developed in-house, the news system is financed through advertising commercials.
27
Personnel
The number of employees working for
Flughafen München GmbH rose by 323, year on
year, to 4,891 (at December 31, 2003), an increase of around 7.1 percent. Of the total workforce of 4,891, 2,142 were salaried employees
and 2,749 wage employees. Two thousand and
six of the salaried employees had unlimited contracts, five were on fixed-term contracts, and 12
were temporary workers. In addition, the airport
had 36 management trainees and 83 trainee
business administration staff. Of the 2,749 wage
employees, 2,169 had unlimited contracts, 549
were temporary workers, and 31 were vocational
apprentices. In 2003, Flughafen München GmbH
took on 28 business administration apprentices
and eleven apprentices in manual trades.
28
Employees from more than 50 countries
The number of foreign nationals in the workforce
increased marginally. At December 31, 2003, 789
foreigners were working for FMG – 52 more than
a year earlier – accounting for 16.13 percent of
the total workforce. These foreign nationals came
from a total of 56 countries. As in previous years,
the majority were Turkish citizens – 475 in all; 54
employees were from Austria; and 46 were from
Italy.
Breakdown of personnel costs
(€ million)
Wages and salaries
(including subsidies for
travel and meals)
Social security levies,
costs of retirement plans
and related benefits
Total personnel
expense
2003
2002
2003 / 2002
173.3
154.4
+ 12.2 %
47.3
39.3
+ 20.4 %
220.6
193.7
+ 13.9 %
Personnel expense higher due to workforce
growth
The year 2003 was shaped by a major milestone
in Munich Airport’s development – the inauguration of Terminal 2. The completion and commissioning of the new facility and the initial months
of operation not only called for a considerable
effort on the part of everyone involved but
necessitated the hiring of new employees. At the
same time, growth in traffic, too, increased the
company’s need for human resources. In spite of
the fact that the company had stocked up HR
capacity in previous years in anticipation of the
changes ahead, it nevertheless needed to boost
the headcount significantly during 2003.
Flughafen München GmbH’s HR capacity increased by 7.6 percent in 2003 to a total of 4,253
employee-years. As a result, personnel expense
rose by 13.9 percent or €26.9 million on 2002 to
€220.6 million. Besides the increase in the headcount, provisions for phased retirement programs, higher social costs, and collective wage
agreements drove personnel expense higher.
29
Training programs for 120 young people
In September 2003, 39 young people embarked
on apprenticeship programs with Flughafen
München GmbH (FMG), including the first female
inductee for our mechatronics program. During
2003, Flughafen München GmbH put 120 young
people through apprenticeship programs for
business administration, office communications,
and aviation services, as well as university-level
degree programs in commercial informatics,
business and airport management, mechatronics
(the “classic” variety), and mechatronics with
specialization in standard and specialty vehicles
and mobile equipment. In March 2003, the
Munich West regional “Jugend forscht” and
“Schüler experimentieren” competitions for
young scientists took place under the auspices of
Flughafen München GmbH. Forty-nine projects in
a range of fields, including mathematics, the
work environment, chemistry, information technology, and physics, were put on show in the
administrative building and evaluated by competition adjudicators. FMG also took part in “Girls’
Day,” a Bavaria-wide event held on May 8 with
the goal of encouraging an interest among
young women currently evaluating possible
career tracks in jobs that traditionally are the
domain of men. FMG welcomed young women
from the city of Munich and the local region,
showed them the company’s apprentice training
facilities, and provided them with information on
careers in IT. “Berufsfit 2003,” another careers
event under the patronage of FMG, set out to
provide school students with extensive information on a range of career opportunities. FMG
shared an information booth at the event with its
affiliates aerogate, Cargogate, and CAP.
Exchanges and joint projects
As in previous years, FMG again took part in the
exchange scheme operated as part of the European Union-sponsored Leonardo da Vinci education program. In 2003, four groups of FMG apprentices were given the opportunity to gather
work experience at other European airports.
30
Apprentices in business communication visited
Lisbon and Faro airports in Portugal; business
administration apprentices spent time working
in Dublin; and aviation service apprentices were
hosted by Malta. Likewise as part of the
Leonardo da Vinci program, young engineers
from Aeroportos, the company that operates
Portugal’s airports, spent time at Munich Airport.
Munich also organized its first exchange of apprentice mechatronics engineers with Vienna
Airport in September and October 2003. The program gave young people the opportunity to
learn about the technical departments and style
of working at their partner airport.
Popular among managers and interns
At the international level, FMG stepped up its
collaboration with the Civil Aviation Authority of
China (CAAC), the organization that operates
China’s airports. Managers from China attended
a training course on safety and security at
Munich Airport, and the directors of a number of
Chinese airports took part in an operations
management program. As part of our continuing
collaboration with Bavarian industry’s education
organization, ministry officials from a number of
public authorities were able to learn about
FMG’s organizational structure and decisionmaking processes and were seconded to FMG
departments specializing in areas close to their
own field of expertise. At the same time, FMG
employees had the opportunity to go on information visits to selected ministries. This exchange program helps to increase understanding of working procedures and aims to streamline cooperation between the airport and
government offices. FMG was again a much
sought-after company for internships in 2003
and took on 189 students from schools, universities, and retraining programs studying in a variety of subject areas. In particular, students from
local schools, colleges and universities had the
chance to gain valuable hands-on experience in
a proper working environment and on real-life
projects.
Training for Terminal 2
HR development and onward training program
curricula in 2003 were very much governed by
the commissioning of Terminal 2. Extra seminars
were held to familiarize staff with the topography of the new terminal and its operations
areas, including the baggage transportation
system, the air bridge systems, and the apron
control facilities. As a result, the volume of training delivered increased by 58 percent in comparison with 2002 to 24,334 attendee-days in total.
Just as in the previous year, the seminars were
consistently rated by participants as good to
very good. In connection with operating the new
passenger terminal, the company again needed
additional HR capacity to handle dispatching,
apron control, and central traffic control tasks,
just as in 2002. Thirty-eight employees successfully completed training for duties in these
areas.
Assessing demand for training
In the interests of targeted, more cost-effective
personnel development, Flughafen München
GmbH in 2003 conducted a survey assessing the
need for training throughout its workforce.
Initiatives defined for 2004 based on the survey’s
findings have already been incorporated into the
company’s onward training program for the current year. The vast majority of onward training
efforts, accounting for 68 percent of the entire
program, consisted of seminars on the traffic
sector. One hundred and ninety-seven employees
successfully completed level 1 and level 2 operations exams (internal FMG qualifications) that
serve as a foundation for subsequent chamber of
industry and commerce (CIC) examinations; 44
FMG employees also succeeded in passing CIC
examinations to achieve official certification as
aircraft handlers.
In appreciation of their services and with sorrow
we remember the following colleagues who
passed away in 2003. They will be sadly missed
by their fellow employees.
Hans-Jürgen Widder
Theo Mankartz
Guido Vogt
= June 3, 2003
= August 30, 2003
= September 2, 2003
31
Subsidiaries and associated companies
With net sales in excess of €376 million and with
almost 2,500 employees under contract, Flughafen
München GmbH’s subsidiaries and associated
companies play a crucial role in the FMG Group’s
business growth and development. In 2003, their
products and services were once again indispensable in helping Munich Airport to successfully
meet the challenge of fulfilling its role as a major
multifunctional European service center. The goal
driving Flughafen München GmbH’s policy regarding subsidiaries and associated companies
remains to improve – and widen, where appropriate – Munich Airport’s offering for its customers.
32
aerogate München – Gesellschaft für
Luftverkehrsabfertigungen mbH
The purpose of aerogate is to provide passenger
and aircraft handling services in those sectors
not already covered by ground services. The
company also operates baggage delivery and
ticketing services. In spite of competition from
several rival service operators, the negative
effects of the Iraq conflict, SARS, and the generally slow economy, the company succeeded in
generating proceeds on sales of €11.2 million.
With a workforce of 276 contractual employees,
aerogate handled 1.5 million passengers and
20,250 aircraft in 2003.
AeroGround Flughafen München Aviation
Support GmbH
AeroGround primarily plays a supporting role in
the provision of handling services by Flughafen
München GmbH. The company recruits students
and other temporary workers, and hires out their
capacity to ramp services to assist with aircraft
handling. With a workforce of 357 employees,
the company achieved net sales of €5.9 million
in fiscal 2003.
AFBG Augsburger Flughafen Betriebs-GmbH
AFBG’s purpose is to manage business operations at Augsburg Airport. The operating company carries the legal liability and invests in other
companies formed in connection with developing and running Augsburg Airport. AFBG’s shareholders comprise Flughafen München GmbH (50
percent), the city of Augsburg, the Augsburg
administrative district, the Aichach-Friedberg
administrative district, and a pool of Augsburg
entrepreneurs.
Allresto Flughafen München Hotel und
Gaststätten GmbH
Allresto and its workforce of more than 660 people generated total sales of €51.8 million in fiscal
2003, making the company Flughafen München
GmbH’s second-highest-earning affiliate. Allresto
operates the restaurants and bars in both of
Munich Airport’s terminals, a Burger King fastfood restaurant, the “municon” congress center,
and the airport hotel (managed by the Kempinski
Group). Although Allresto manages its hospitality operations itself, its hotel and casino activities
(with the exception of the casino in the MAC) are
run by third-party operators. In Terminal 1, due
to the decentralized structure, the company operates bars in all the non-public departure areas
and in the public arrival areas. In addition, there
are six more snack bars, plus several restaurants, including Airbräu, Käfer, and Il Mondo. In
Terminal 2, Allresto runs the Airbräu and Käfer
restaurants, the Italian piazza, and the bars in
the pier area.
CAP Flughafen München Sicherheits-GmbH
With a workforce of 294 employees, CAP provides
guard and security services at Munich Airport and
specializes in implementing the security measures required specifically under aviation law. In
2003, CAP reported sales in excess of €13 million.
The company is owned jointly by Flughafen
München GmbH (76.1 percent) and SECURITAS
GmbH Aviation Service (23.9 percent).
Cargogate Flughafen München Gesellschaft für
Luftverkehrsabfertigungen mbH
Cargogate employs a workforce of 183 people
and provides air cargo handling services at
Munich Airport. Besides the transshipment of
cargo, these services include the storage and
documentation of freight goods. In spite of growing competition, Cargogate remained the largest
independent cargo handler at Munich Airport. In
2003, the company handled more than 80,000
metric tons of freight for 75 airlines and reported
total earnings of €10.4 million.
EFM – Gesellschaft für Enteisen und Flugzeugschleppen am Flughafen München mbH
Co-owned by GlobeGround GmbH (51 percent)
and Flughafen München GmbH (49 percent),
EFM is responsible for de-icing aircraft at
Munich Airport. Its services also include aircraft
pushback and maneuvering on the apron and in
the maintenance area. With a workforce of 119
people, the company achieved sales totaling
€18.5 million in the past fiscal year (ending
September 30, 2003).
eurotrade Flughafen München Handels-GmbH
In spite of the war in Iraq, SARS, and the generally poor economic climate, eurotrade and its
workforce of almost 800 succeeded in boosting
sales by €7.2 million to €77.9 million, again
making the company the Flughafen München
GmbH subsidiary with the highest net sales.
Eurotrade operates a wide range of retail outlets
at Munich Airport – everything from duty free,
Travel Value and newsagents’ stores to shops
selling travel goods, souvenirs, cosmetics, clothing, and toys. In 2003, the company also began
operating cafés and snack bars embedded in
retail units. In Terminal 1, due to the decentral-
33
ized structure, the company has to operate duty
free, Travel Value, and newsagent outlets in
every module, but in the new terminal, these
stores are all set up at central locations. Flughafen München GmbH owns 74 percent of eurotrade; Mr. Herbert Wolter holds the remaining 26
percent.
FMV – Flughafen München Versicherungsvermittlungsgesellschaft mbH
FMV brokers and manages insurance of kinds
but specializes mainly in corporate insurance for
Flughafen München GmbH, Terminal 2 Betriebsgesellschaft mbH & Co oHG, and company
employees. FMV, which also provides consulting
and advisory services for Dresden, Leipzig and
Nuremberg airports, reported sales approaching
€1 million in 2003. The company was owned by
Flughafen München GmbH with 51 percent and
Marsh GmbH with 49 percent (until December
31, 2003).
MediCare Flughafen München Medizinisches
Zentrum GmbH
MediCare operates the Munich Airport medical
center and provides emergency care to airport
employees, passengers, and visitors. The company also offers occupational healthcare services and serves as a contact and intermediation
point for foreign patients at the airport. In addition, MediCare owns AirportClinic München,
operated on concession basis as a private clinic
in accordance with Section 30 of Germany’s
Trade Regulation Act (GewO). The company,
which has 39 employees and reported total sales
of €3.3 million in 2003, is co-owned by Flughafen München GmbH with 51 percent and
MAHM GmbH, an organization formed by a
group of doctors, some of whom are based at
the airport, with 49 percent.
34
Terminal 2 Betriebsgesellschaft mbH & Co oHG
Terminal 2 Betriebsgesellschaft is responsible for
operating the airport’s new Terminal 2 and future
extensions to the airport facilities. Its activities
include the leasing and letting of buildings and
facilities, and the provision and purchase of services, in particular services required in connection with air-side and land-side handling operations. Following the inauguration of the new terminal on June 29, 2003, the company booked
total sales of €111.3 million in the year’s second
half. The company is jointly owned by Flughafen
München GmbH with 60 percent and by Passage
Service Holding (PSH), a wholly owned Lufthansa subsidiary, with 40 percent. Terminal 2 Betriebsgesellschaft mbH & Co oHG was formed at
the start of the fiscal year by merging Terminal 2
Betriebsgesellschaft mbH and Mobilien-Verwaltungsgesellschaft Terminal 2 mbH.
FM Terminal 2 Immobilien-Verwaltungsgesellschaft mbH & Co oHG
The purpose of the company is to finance and
build the second passenger terminal at Munich
Airport, which has now been rented out to
as the primary tenant. The company is co-owned
by the FMG company Terminal 2 Holding GmbH
and by Lufthansa Commercial Holding, a wholly
owned Lufthansa subsidiary. The company has
reported total revenues from rents of €32 million since the new terminal opened.
Terminal 2 Holding GmbH
The purpose of the company is to hold Terminal
2-related and other FMG investments, which currently include FM Terminal 2 Immobilien-Verwaltungsgesellschaft mbH & Co oHG.
35
Environmental protection
Noise levels remain consistently low
In spite of an increase of more than 3 percent in
the number of takeoffs and landings at Munich
Airport, noise levels remained low, thanks to the
high proportion of small and quiet aircraft across
traffic as a whole. Just as in the past three years,
none of the 16 measuring stations in the airport’s
surrounding area recorded a continuous sound
pressure level of more than 60 dB(A) in 2003.
Averaged out over the year, 58 percent of aircraft
took off and landed in a westward direction,
compared to 42 percent in an eastward direction.
36
More tests on propeller aircraft
In comparison with a year earlier, the number of
engine test runs in the airport’s hush house was
almost unchanged at 829 (2002: 824). Around half
of the tests were carried out during the daytime.
Turboprop aircraft have now been assigned a
new stand in the hush house, further reducing
the nighttime levels of noise from test runs that
were being picked up at the Hallbergmoos measuring station. This move proved necessary due
to the sizeable increase in engine test runs for
propeller aircraft. Changes to departure routes
and to the way these routes are used meant that
aircraft noise readings had to be taken in
Moosburg, Aich, Zusdorf, Leonhardsbuch, and
Hohenkammer. The results obtained form these
readings provided objective documentation of
changes in the noise situation at the locations in
question.
Airborne pollutants at non-critical levels
In 2003, we continued the long-term measurements of airborne pollutant levels started in 1991.
Although subject to fluctuation during the course
of the year, levels for the most part remained in
the low-to-moderate range. The nitrogen oxide
level over the year was non-critical at 46 percent
of its set limit. Even so, nitrogen oxide emissions
will be tracked more carefully in the future – first,
because levels around the airport are gradually
on the increase although generally on the decline
in other areas, and second, because increasingly
stringent limits will gradually be imposed by statutory requirements through to 2010. High levels
of ozone were recorded at times in the airport’s
surrounding area during the summer of 2003.
This was not caused by airport operations but by
generally higher nitrogen dioxide levels in the air
as a result of increasing numbers of motor vehicles on roads throughout Central Europe in con-
junction with the exceptionally hot summer.
Median levels during the summer months were
considerably higher than at any time previously
since regular recordings began around the airport. In August, the figure reached roughly 104
micrograms per cubic meter (µg/m3), compared
to the previous maximum of 75 µg/m3, recorded
in June 2000.
Night flights remain relatively constant
New night-flight regulations introduced in March
2001 have not resulted in increased night-time
disturbance, particularly as the average number
of aircraft movements at night has remained
more or less constant since 1999. The 42 takeoffs
and landings on average that took place each
night represent just 4 percent of the 974 flights
that Munich Airport handled each day in 2003.
This means that only 28 percent of the permitted
noise quota – set at a continuous equivalent
noise level (Neq) of 105 – was actually used. This
requires explanation: All aircraft night operations
are subject to a noise quota which must not
exceed a maximum of Neq = 105 on an average
night over the period of a calendar year. The
equivalent noise level is calculated based on the
noise volumes produced by individual aircraft
types during takeoff or landing.
Power for 155 households
A photovoltaic installation fitted with solar modules containing polycrystalline cells has been in
operation on the roof of Terminal 2 since July 10,
2003. Built to the very latest technical standards,
the solar installation is connected to the mains
power system and feeds 445,000 kWh of power
per year into the grid. To put this figure in
perspective, this output would be sufficient to
supply roughly 155 households with power for a
whole year.
37
Corporate communications
Media spotlight on airport expansion
Munich Airport’s media relations work in 2003
centered primarily on the inauguration and commissioning of Terminal 2. Thanks to well-timed,
systematic and comprehensive efforts to involve
the media, the company succeeded in generating enormous interest in the airport’s expansion,
not just at a regional and national level, but at
an international level too. Not since 1992, the
year in which Munich Airport moved to its current location, has it received such extensive
news coverage. A review of the media’s assessments of the airport’s expansion showed that
almost all reports published were positive,
acknowledging the magnitude of the achieve-
38
ment. Thus, media relations efforts made a successful and valuable contribution to the new terminal’s smooth start. In 2003, Flughafen München GmbH published a total of 78 press
releases reporting in detail on current events at
the airport. A large number of up-to-date press
photographs published in numerous newspapers, magazines, and in-house publications
helped to promote a public image of Munich as
an advanced and rapidly growing commercial
airport. Media relations work also included
responding to an average of 300 inquiries a
week, plus organizing more than 250 TV, photo,
and sound-recording sessions at the airport,
including a number of live broadcasts. Corporate
Communications also prepared around 40
speeches, addresses, and signed articles on
behalf of FMG’s executive management team.
Corporate design for the new terminal
With the support of Flughafen München GmbH’s
design council, a body consisting of renowned
building planners and architects, the company
published a manual of design guidelines for
Terminal 2. Aimed at building companies and industrial designers, the guidelines document binding architectural standards and describe typical
design features – everything from facade layouts
to colors, materials, fixtures, fittings, and visual
communication elements. The goal of the guidelines is to uphold Munich Airport’s high levels of
architectural and corporate design now and in the
future.
Information on Terminal 2
Part of the company’s public relations work
involved preparing detailed maps, floor plans,
and several publications focused entirely on
Terminal 2, its history, and its operational side
so as to inform passengers, visitors and the
interested public in good time and in detail
about the new building. The flagship publication
was a lavish brochure produced in German and
in English in time for the opening of the terminal. In addition, the company had to update all
of its current brochures and flyers on Munich
Airport to include Terminal 2 and the new multistory parking garage P 20 so as to provide airport users with specific information and aids to
orientation in the new and unfamiliar buildings.
The fact that additional reprints of all these brochures and flyers were needed within just a few
weeks is indicative of the scale of demand for
information on Terminal 2. Naturally, FMG’s and
Lufthansa’s joint infrastructure project also featured prominently in the airport’s two newsletters, M terminal, our newsletter for the airport’s
customers and neighbors, and Flughafen Report,
our employee newsletter. Readers were able to
find out everything worth knowing about Terminal 2 in a special supplement published in June
to mark the building’s inauguration and distributed to guests and passengers.
Celebrations, art and young scientists
FMG’s events calendar, too, was dominated by
the inauguration of Terminal 2. The planning for
the celebration on June 27 was conducted with
military precision. From seats on stands, 2,500
guests followed the opening ceremony and the
spectacular countdown through to the unveiling
of the new terminal’s facade. FMG’s and Lufthansa’s 5,000 or so employees had every reason
to celebrate, and as a mark of gratitude for years
of dedicated work preparing for the commissioning of the new terminal, the two companies
threw a party for their employees in Hangar 4.
Art exhibitions in the airport’s central area,
which in 2003 included showings of work by six
artists from the airport’s surrounding region, are
proving increasingly popular. In 2003, there was
another new high point in FMG’s events calendar: For the first time the company organized the
young scientists competition “Jugend forscht”
for the Munich West region.
Optimizing online communications
Having successfully launched the FMG group
internet portal a year earlier, the company
embarked on new initiatives for internal communications. The existing corporate intranet was
subjected to critical review to determine its value
for users and was subsequently given a comprehensive overhaul. The goal was to create a consistent internal and external online presence.
Now consisting of three main theme-specific
zones offering new services and content, the relaunched intranet site offers the group’s workforce of 6,700 people a more interesting and useful user experience. Access to a common pool of
data ensures faster and more efficient processing
of information, creates synergy benefits, and
promotes cost savings.
39
Marketing
Flughafen München GmbH’s marketing was
another area dominated by the commissioning of
the new terminal in fiscal 2003. Many of the company’s marketing initiatives were aligned with
this key event.
40
Terminal viewings and events
People throughout the domestic and international travel industry showed a considerable interest
in taking guided tours of the entire new facility
so as to get to know the overall infrastructure,
the operational processes, and the passenger
routing. During the course of 2003, some 350
groups of industry professionals with more than
3,800 participants in total – mainly travel agency,
Lufthansa and tour operator’s employees – from
across Europe and from other continents were
taken through the new terminal building by
FMG’s marketing people and visitor service staff.
At a pre-event on June 14, 2003, two weeks prior
to the inauguration, a further 1,300 visitors, primarily dispatchers from major travel agencies
who had been flown in by Lufthansa specially
from all over Germany, came to view the new
handling facility. This major event with its many
highlights offered the ideal occasion at which to
present Terminal 2 in an optimum way to a key
target group.
CD-ROM and advertisements
As a supplement to the guided tours, Marketing
developed a tuition CD-ROM designed to offer a
clear overview of the operating processes, passenger routing, and service facilities in both terminals, the central area, and the München
Airport Center. In advance of the commissioning
of Terminal 2, 5,000 travel agencies and company travel service departments in Germany were
sent the CD as a medium for self-study and for
customer information. The CD was also distributed in much larger quantities at trade shows and
events for travel agency employees and,
through our overseas representations, to people
in the travel and tourism industry in North
America and Asia. In the United States alone,
the CD was sent to 2,000 travel agencies.
Flanking these activities, Flughafen München
GmbH ran a number of B2B advertisements in
national and international trade media, primarily
targeting airlines, travel agencies, tour operators, and company travel services. The main
message communicated in the ad campaign was
that Munich Airport was doubling its capacity,
yet care was taken to present the two terminals
as being on a par with one another.
Positioning Terminal 1
Following Lufthansa’s and its partner airlines’
relocation to the new terminal, a number of
other initiatives centered both on promoting
Terminal 1 as an equally valuable and attractive
location for the remaining and future users and
on generating additional traffic to achieve better
capacity utilization. This succeeded in part
through a variety of mail shots aimed at selected
travel agents and multipliers that concentrated
on Terminal 1’s benefits, including the short
distances to be covered by originating and terminating passengers in point-to-point traffic.
Acquisition of new airlines
The acquisition of new business and the support
of airlines remained a key focus of our marketing work in 2003. We managed to acquire lowcost carrier Germania Express (Gexx), which
began operating a number of new services out
of Munich – a highly successful move, as it
turned out, because by September Germania
Express ranked tenth in terms of passenger
movements among the airlines at Munich
Airport. Overall, low-cost carriers made a sizeable contribution to Munich Airport’s positive
traffic results: Passengers traveling with these
airlines accounted for 9 percent of the total
volume. The new carriers also included Air Transat, which began serving Toronto (and Halifax
from 2004) during the summer season. Marketing also succeeded in encouraging Hapag
Lloyd/TUI to operate a second weekly hub in
Munich.
Key inaugural flights by Lufthansa
Lufthansa celebrated inaugural flights on routes
from Munich to Montreal, New York/Newark, and
Miami, attracting considerable media interest. In
spite of problems such as the war in Iraq, SARS,
and the lackluster economy, Flughafen München
GmbH’s Marketing department succeeded in
mastering the challenges it faced and made an
essential contribution toward continued growth
at Munich Airport.
Another marketing award
For the fifth time in six years, Flughafen München GmbH picked up an award for the best marketing. At Routes 2003, an international conference held in Edinburgh for airports and airlines,
FMG took first prize among airports with 10–25
million passengers and received the Airport
Marketing Award 2003. The selection criteria for
the award were quality of presentation, communications, and general marketing activities.
41
The inauguration of Terminal 2
As the final strains of the Bamberg Symphony
Orchestra’s rendition of Stravinsky’s “The Firebird”
died away beneath the vast roof span of the MAC
Forum, a group of politicians of different party allegiances pulled together on a cord, releasing some
4,200 square meters of fabric, which slid gently to
the ground to reveal a facade of glass, emblazoned
with the words “Terminal 2 – Ready for Takeoff!”
42
And at that moment, the second passenger terminal at Munich Airport was open, an event
which FMG’s supervisory board chairman and
Bavarian minister of finance Prof. Kurt Faltlhauser in his welcome address had referred to as a
“quantum leap forward.” Some 2,500 guests of
honor had gathered together on June 27, 2003,
in perfect weather, to witness the official opening of what Wolfgang Mayrhuber, chairman and
CEO of Deutsche Lufthansa AG, termed “the
most modern and convenient terminal at the
most advanced commercial airport in Europe.”
Among the invited guests were Germany’s transport minister, Dr. Manfred Stolpe, Bavarian mini-
ster-president Dr. Edmund Stoiber, several members of Bavaria’s state government, Munich’s
mayor, Christian Ude, prominent federal, state,
and local politicians, numerous CEOs from
domestic and foreign airports, almost the entire
Lufthansa executive board, and board members
from several other airlines. Leading members of
the business community, including Siemens
president and CEO Dr. Heinrich v. Pierer, were
also among the guests, as were representatives
of government agencies, and managers of companies located at the airport. All of the speakers
in their inaugural addresses chose to highlight
the enormous importance of the expansion of
43
Munich Airport. In the words of Kurt Faltlhauser,
for example, “Bavaria’s capital is now one of the
foremost hubs in Europe’s aviation industry.”
And as FMG CEO Dr. Michael Kerkloh noted,
much to the applause of the 2,500 guests,
“Germany now has a prominent and enduring
place on aviation’s map of the world with its airports in Frankfurt and Munich.” Lufthansa chairman Wolfgang Mayrhuber shared this view entirely, stating, “Germany today has two hubs of
equal standing, and Lufthansa now has a second
home in Bavaria.” Following the blessing of the
new terminal by Cardinal Friedrich Wetter and
Regional Bishop Susanne Breit-Kessler, the
44
guests were treated to an exceptional and engaging inaugural gala show. Special events artist
Jochen Schweizer’s troupe of acrobatic performers transformed the entire facade of the new
passenger building into a stage for a spectacular
“vertical ballet” and a series of breathtaking
stunts, all performed against the backdrop of the
shrouded wall of glass. Then the prominent
speakers stepped forward to perform the inaugural act: Assisted by former FMG president
and CEO Willi Hermsen and former Lufthansa
chairman Jürgen Weber, they unveiled the facade
of the new terminal building, marking the beginning of a whole new era at Munich Airport.
45
2003 year-end accounts
46
Management’s review of fiscal 2003
General economic environment and situation in
the industry
Towards the end of the year, the global economic situation, which had been adversely affected
by the Iraq crisis and rising oil prices, gradually
began to pick up, and industrialized countries,
most notably the USA and Japan, started to
show clear signs of growth and higher overall
economic output. In the euro zone, too, forces
for growth began to mount, although not with
the same dynamic as in the USA. The German
economy, however, saw its gross domestic product slip 0.1 percent, and continued to stagnate
for the third year in succession. Economic forecasts for 2004 point to a turn for the better and
the onset of an improvement in Germany’s economic situation. In spite of the curbing effect of
the strong euro, analysts expect German industrial output to show a marked increase in 2004.
Global aviation, still suffering under the aftereffects of the events of September 11, 2001, was
impacted further by the war in Iraq and the consequences of the respiratory disease SARS. At
the same time, the generally slow global economy provided no real impetus for growth. Even
so, during the course of 2003, there were the
beginnings of an upturn at Germany’s airports,
albeit at a low level. Commercial airports belonging to the German Airports Association
(ADV) again saw significant growth in passenger
numbers by almost 4 percent in 2003, but this is
still well below the level prior to the crisis
triggered by September 11, 2001.
Business trends
Fiscal 2003 was marked by the commissioning of
Terminal 2, the new passenger facility co-built
and co-financed by Flughafen München GmbH
and Deutsche Lufthansa AG and operated by a
jointly held company. Since June 29, 2003,
Munich Airport has had a terminal at its disposal
which, compared with other European aviation
hubs, has a highly advanced passenger handling
system, offers exceptional levels of comfort and
service, and, because it was designed to support
hub-and-spoke operations from the beginning,
puts the airport in an optimum position of competitive strength.
In spite of the generally difficult economic climate, Munich Airport succeeded in returning to
past form in terms of growth in 2003. Compared
to the prior year, Munich managed to regain the
number eight slot in the rankings of Europe’s
busiest airports and, in contrast to the majority of
rival hub airports in Europe, was able to report
solid rates of increase.
The number of passenger movements rose by
1.0 million year on year to 24.2 million, an increase of 4.4 percent. Aircraft movements in all
traffic segments were up 3.3 percent compared
to a year earlier, with a total of 355,602 takeoffs
and landings. Having risen a sharp 17 percent in
2002, the volume of freight carried by air shrank
by 2.6 percent to 140,585 metric tons in 2003.
Flughafen München GmbH’s net sales totaled
€593.3 million, an increase of 6.8 percent on the
prior year.
Revenue from aviation business in fiscal 2003
remained more or less unchanged at €327.7 million (2002: €327.6 million). FMG recorded a
moderate rise in earnings from aircraft landing
fees and parking fees, which increased by €10.4
million, to €195.1 million. Revenue generated by
ramp handling services dropped by €10.3 million
to €132.6 million. Even so, the company succeeded in competing effectively with the local
licensed ramp services operator.
There was a marked rise in revenue from nonaviation business, which increased by €37.6 million to €265.5 million and contributed 44.8 percent of total earnings. Although non-aviation
revenue from hire charges, parking, utilities and
transferred costs of sundry services was substantially higher in 2003, revenues from concessions
and rents were down €4.5 million on their yearearlier level.
Pre-operating costs for Terminal 2 led to an
exceptionally large increase in materials expense, which rose by €49.6 million to €159.6 million. However, for the first time this includes variable landing fees charged for T2 passengers and
totaling €31.3 million, which were transferred to
Terminal 2 Betriebsgesellschaft. The rise in personnel expense by €26.8 million, or 13.9 percent,
to €220.6 million, was primarily due to the commissioning of Terminal 2 on June 29, 2003.
xx
47
Interest, leasing charges and depreciation – key
cost factors for the company – amounted to
€166.6 million, accounting for 26.2 percent of
total expenditure. Compared to a year earlier,
this marks a drop of 8.6 percent, or €15.6 million.
One of FMG’s subsidiaries is largely responsible
for the financing of the Terminal 2 building and
mobile equipment.
Having reported a net profit of €6.5 million in
fiscal 2002, the company posted a net loss of
€51.2 million in fiscal 2003. The loss in the review
year is primarily due to the commissioning of
Terminal 2 and the attendant financing costs,
depreciation, and operating costs carried either
directly or, to a greater extent, as transfer losses
from Terminal 2 subsidiaries.
The earnings of FM Terminal 2 ImmobilienVerwaltungsgesellschaft mbH, reformed as a
general commercial partnership in 2003, are
reported as part of Terminal 2 Holding GmbH’s
earnings.
Other declines in earnings in 2003 relating to the
construction and operation of Terminal 2 are
from the associated companies Allresto Flughafen München Hotel und Gaststätten GmbH and
Eurotrade Flughafen München Handels-GmbH,
of which the latter operates the duty free and
Travel Value stores and other retail outlets at the
airport. Although Allresto reported a €4.3 million
drop in earnings, year over year, yet succeeded
in concluding the year with net income of €28
thousand, the loss transferred by Eurotrade ran
to €3.8 million, a drop of €5.1 million compared
to a year earlier.
Affiliates
The positive developments in Munich Airport’s
traffic during fiscal 2003 are not reflected in the
company’s income from affiliates, which declined by €23.1 million, resulting in earnings of
negative €39.0 million.
Two exceptions to the generally downward trend
were our subsidiaries EFM – Gesellschaft für
Enteisen und Flugzeugschleppen am Flughafen
München mbH and CAP Flughafen München
Sicherheits GmbH, whose net income increased
by €0.2 million to €0.6 million in 2003.
Other subsidiaries returning positive results
were AeroGround Flughafen München Aviation
Support GmbH and FMV – Flughafen München
Versicherungsvermittlungsgesellschaft mbH,
whose earnings increased by €0.2 million to
€0.6 million, year on year.
The opening of Terminal 2 and the attendant
start-up losses resulting from high depreciation
and financing costs are reflected in the negative
results achieved by associated companies. The
main causes of losses are the loss transfers from
and Terminal 2 Holding, which totaled €35.6 million in the review year. For fiscal reasons, the
company that owns Terminal 2, MOB – MobilienVerwaltungsgesellschaft Terminal 2, was merged
retroactively from January 1, 2003, with Terminal 2
Betriebsgesellschaft mbH to form Terminal 2
Betriebsgesellschaft mbH & Co oHG.
48
FMG also had to carry losses of €727 thousand
sustained by Cargogate Flughafen München
Gesellschaft für Luftverkehrsabfertigungen mbH.
The negative result was primarily attributable to
declining sales, above all through the loss of
business from Singapore Airlines.
Publication of the year-end financial statement
The year-end financial statement for the 2002
fiscal year was published in issue number 206 of
the Federal Gazette on November 5, 2003.
Financial position and capital structure
Compared to December 31, 2002, the balance
sheet total increased by 4.2 percent, to €2.7 billion. This is essentially due to additions to tangible assets. Additions totaled €163.3 million,
compared to disposals of €11.8 million and
write-downs of €96.5 million. Year on year,
investments remained steady at €21.2 million.
Current assets increased by €30.6 million in
2003. This was mainly on account of a €20.0 million increase in receivables from affiliated companies and a rise of €6.2 million in other assets
and liquid funds.
At €358.5 million, equity was lower compared to
a year earlier by €51.1 million, the amount of the
net loss sustained in fiscal 2003. Shareholder
loans remained unchanged in comparison with
the prior year at €1.28 billion.
Provisions and liabilities increased by €82.9 million to €573.2 million in comparison with fiscal
2002. The causes for this were mainly the formation of provisions to cover €54.9 million in future charges for the construction of infrastructure for Terminal 2, a year-on-year increase of
€14.7 million in payables to banks, and an increase of €12.3 million in payables to associated
companies in 2003.
An additional €21.1 million were invested in
Flughafen München GmbH’s day-to-day operations. Besides expanding its infrastructure, the
company also spent €11.5 million on plant and
office equipment in connection with the construction of Terminal 2. A further €7.3 million
were invested in rapid exit taxiways, plus €2.3
million in additional airport lighting.
Under the terms of a contractual agreement
governing the utilization of supply and disposal
services, Terminal 2’s real-estate company was
obligated to pay construction cost subsidies for
installations owned by Flughafen München
GmbH. For this reason, a deferred income item
of €50.0 million was formed which will be written back over the contractually agreed term.
Risks
Flughafen München GmbH employs a system of
risk management that enables it to rapidly identify and gauge all potential risk facing its companies.
The primary goal of risk management is to take
a controlled approach to risk and to define preventive measures to avoid it.
Capital investments
In the review year, Flughafen München GmbH’s
capital investments again centered largely on
the construction of the new passenger facility
Terminal 2, which opened on June 29, 2003.
According to current forecasts, the project as a
whole is expected to cost €1.5 billion.
The accounting for the terminal building and for
the assets relating to Terminal 2 is conducted
through two property companies in which
Flughafen München GmbH and Lufthansa have
respective stakes of 60 percent and 40 percent.
For fiscal reasons, the property company formed
to manage Terminal 2’s movable capital goods
was merged with the Terminal 2 operating company in 2003.
Based on the total forecast project costs of €1.5
billion, the overall investment is spread across
the following companies:
Immobiliengesellschaft
(Terminal 2 building)
All risk information is processed internally on a
quarterly basis to enable the company to
respond effectively to shifts in risk scenarios.
Updated risk reports are supplied each quarter to
all members of the supervisory board. As the
geopolitical situation in the wake of September
11, 2001, has shown, the development of aviation does not depend purely on business and
economic drivers. Issues such as security and
health are emerging as increasingly important
factors for the aviation sector.
One focus of our risk management is on the possibility of airlines ceasing to operate or scaling
back services on selected routes, which could
reduce capacity utilization in Terminal 1 or curb
anticipated growth in Terminal 2. Now that
Terminal 2 has been completed and commissioned, Flughafen München GmbH’s business
performance will be governed for the most part
by the degree of capacity utilization in Terminal 1
and growth in Terminal 2.
€867.8 million
Terminal 2 Betriebsgesellschaft
€272.3 million
(movable capital goods)
(Terminal 2 infrastructure)
€359.9 million
49
At the forefront of our plans are the continued
expansion of hub traffic at Terminal 2 and targeted remodeling work to support aviation at
Terminal 1.
Current risk inventory-taking has identified no
potential risk to Flughafen München GmbH’s current situation.
Outlook
With the commissioning of Terminal 2 on June
29, 2003, Flughafen München GmbH created the
right conditions for future growth based primarily on an expansion of hub-and-spoke operations.
Together with Lufthansa, Flughafen München
GmbH will develop Munich Airport into an efficient and competitive aviation hub for intercontinental as well as for European air traffic.
In 2003, the volume of intercontinental traffic
grew more rapidly than either domestic or
European traffic, recording an 11 percent increase in passengers and 14 percent more flights.
The introduction by Lufthansa of new routes to
Dubai, Miami, Newark, and Montreal helped
strengthen Munich’s importance as a hub airport.
Lufthansa’s plans for new long-haul services to
the U.S. and Asia, announced in the summer of
2004, underscore the airport’s prospects for
strong growth.
We also expect additional impetus to come from
greater utilization of the capacity available in
Terminal 1. We have plans for a variety of targeted restructuring and remodeling work in Terminal 1 to enhance its traffic-handling capabilities
and to allow us to respond flexibly to aviation’s
divergent and specific requirements with individually tailored offerings. Terminal 1’s modular
structure puts us in an optimum position to
accommodate the differing needs and requirements of low-cost carriers and major airlines,
and provide package-tour airlines with a suitable
infrastructure to support hub-and-spoke operations. Thanks to its two highly modern terminals,
each purpose-built to handle a specific type of
traffic, Munich Airport is well-placed to compete
effectively with rival European airports.
50
Given the scale of our investment burden as a
result of Terminal 2, we do not expect to report a
profit in fiscal 2004 or in the years immediately
following. To strengthen our competitiveness, we
are engaged in a comprehensive, group-wide
program to improve strategy and earnings with
the goal of aligning structures and processes
within the company to promote stronger earnings, greater efficiency, and lower costs.
Our key objective is to return the company to
profitability much sooner than anticipated in current planning scenarios.
During the current fiscal year, we expect our traffic figures to be even better than the exceptionally strong figures we posted for 2003.
In light of the immense investment burden and
the related costs of financing and depreciation,
Flughafen München GmbH faces a sizeable challenge to its ability to deliver top performance.
However, the broadly positive economic outlook
in Europe and in Germany, along with the rates
of growth we expect to see in air travel, offer a
solid foundation on which the company can continue to develop successfully.
Munich, May 27, 2004
Dr. Michael Kerkloh
Walter Vill
Peter Trautmann
Annex
I. General notes and information on the year-end
accounts
1 Accounting and valuation principles
Terminal 2’s tangible assets were written down
uniformly pro rata temporis from June 1, 2003.
The year-end accounts as at December 31, 2003,
were prepared in accordance with statutory
financial reporting requirements for large corporations. The income statement was prepared
according to the total cost method.
Long-term investments are stated at their original cost.
Tangible and intangible assets are valuated at
their original cost or at their mandatory capitalized cost of production in accordance with statutory fiscal requirements. Assets with a limited
useful life are written down over their anticipated overall service life as per the write-down
tables for airport operating companies. The new
east apron and related operations areas at
Terminal 2, reported under plant structures and
fittings, are being written down according to the
straight-line method. In addition, movable items
of plant and office equipment are generally written down according to the declining balance
method, whereas other depreciable fixed assets
are written down as per the straight-line
method.
Due to the sale of land, €9.7 million was booked
as a special reserve item as per Section 6b of the
German Income Tax Code (EstG).
In 2003, the difference between the additional
depreciation reported in the accounts prepared
for tax purposes and the additional depreciation
reported in the accounts prepared for financial
reporting purposes totaled €24.1 million. As per
Section 7, Paragraph 1 of the Income Tax Code,
this pertains to buildings which constitute operating business assets but which are non-residential in character. For the most part these are buildings belonging to the passenger handling facilities.
In accordance with a federal finance court ruling,
low-interest employee loans are stated at their
nominal value at the balance-sheet date.
Inventories are mostly stated at their weighted
average cost for the past three months and are
written down at the lower of cost or fair value to
cover risks arising from slow-moving items.
Substitute plots of land reported as inventories
are capitalized at the lower of cost or fair value.
Receivables, other current assets, and liquid
assets are stated at the lower of nominal or fair
value. Identifiable risks are accounted for in
valuation adjustments. Appropriate provisions
are made to cover general credit risk.
Provisions for pensions are valuated according
to their actuarial value at a 6 percent rate of interest and according to new 1998 tables produced
by Dr. Klaus Heubeck. Other provisions are allocated at the value of the anticipated obligations.
Liabilities are valuated at the respective amounts
repayable. Liabilities for annuity payments are
stated at their cash values.
The valuation and accounting principles have
not been changed since the previous fiscal year.
Additions to movable assets in the year’s first
six months are written down at the full depreciable amount for the year; additions in the year’s
second half are written down at half the depreciable amount. Low-value fixed assets are written off in full in the year in which they are
added.
51
Annex
II. Notes and information on the balance sheet
1 Changes in non-current assets
Acquisition and production costs
Jan. 1, 2003
Additions
Retirements
Reclassifications
Dec. 31, 2003
€
€
€
€
€
15,056,294.51
1,397,464.63
-109,948.58
434,397.16
16,778,207.72
Intangible assets
1. Franchises, intellectual
property, and similar
rights and assets
2. Advances on intangible assets
530,247.02
0.00
0.00
-530,247.02
0.00
15,586,541.53
1,397,464.63
-109,948.58
-95,849.86
16,778,207.72
Tangible assets
2,378,331,521.44
84,808,287.40
-4,206,940.19
95,580,758.82
2,554,513,627.47
2. Technical equipment
and machinery
921,350,849.89
57,012,138.36
-4,184,233.79
82,952,249.88
1,057,131,004.34
3. Other equipment, plant
and office equipment
158,857,884.18
11,662,360.11
-3,338,769.15
570,954.04
167,752,429.18
4. Construction in progress
and advances on fixed assets
181,002,704.14
9,853,832.58
-59,511.40
-179,008,112.88
11,788,912.44
3,639,542,959.65
163,336,618.45
-11,789,454.53
95,849.86
3,791,185,973.43
19,537,562.32
15,015,000.00
-15,015,000.00
0.00
19,537,562.32
802,699.07
0.00
0.00
0.00
802,699.07
0.00
0.00
0.00
0.00
0.00
1. Land and buildings
Financial assets
1. Investments in
subsidiaries
2. Investments
3. Non-current marketable
securities
4. Other loans
52
904,104.15
100,003.33
-140,837.74
0.00
863,269.74
21,244,365.54
15,115,003.33
-15,155,837.74
0.00
21,203,531.13
3,676,373,866.72
179,849,086.41
-27,055,240.85
0.00
3,829,167,712.28
Accumulated depreciations
Book values
Jan. 1, 2003
Additions
Retirements
Reclassifications
Dec. 31, 2003
Dec. 31, 2003
Dec. 31, 2002
€
€
€
€
€
€
€
12,875,707.03
1,636,290.47
-109,948.58
0.00
14,402,048.92
2,376,158.80
2,180,587.48
0.00
0.00
0.00
0.00
0.00
0.00
530,247.02
12,875,707.03
1,636,290.47
-109,948.58
0.00
14,402,048.92
2,376,158.80
2,710,834.50
728,779,576.64
45,105,432.78
-315,827.49
0.00
773,569,181.93
1,780,944,445.54
1,649,551,944.80
709,452,999.62
39,208,202.75
-2,832,654.58
0.00
745,828,547.79
311,302,456.55
211,897,850.27
134,231,026.03
12,224,831.31
-3,305,508.94
0.00
143,150,348.40
24,602,080.78
24,626,858.15
0.00
0.00
0.00
0.00
0.00
11,788,912.44
181,002,704.14
1,572,463,602.29
96,538,466.84
-6,453,991.01
0.00
1,662,548,078.12
2,128,637,895.31
2,067,079,357.36
0.00
0.00
0.00
0.00
0.00
19,537,562.32
19,537,562.32
0.00
0.00
0.00
0.00
0.00
802,699.07
802,699.07
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
863,269.74
904,104.15
0.00
0.00
0.00
0.00
0.00
21,203,531.13
21,244,365.54
1,585,339,309.32
98,174,757.31
-6,563,939.59
0.00
1,676,950,127.04
2,152,217,585.24
2,091,034,557.40
53
Annex
2 Currency conversion
6 Net sales/earnings/expenses
Foreign-currency receivables and liabilities are
booked at the respective buying or selling rate
and converted to the less favorable rate on the
balance-sheet date.
Net sales of €593.3 million comprise €327.7 million from the servicing of air traffic (including
€195.1 million in airport fees and €132.6 million
in ramp service fees) and €265.6 million from
licenses, rents, leases, and other sources. The
latter include €8.9 million from the sale of
power (2002: €6.0 million). Power sales account
for 1.5 percent (2002: 1.08 percent) of total net
sales and are of just minor significance.
3 Share ownership
(see table facing)
Holdings in subsidiaries and associated companies are stated at cost.
4 Provisions
Due to differences in the treatment and valuation of accounting income and taxable income,
we are required to report deferred tax liabilities.
On account of the tax carryforward, and based
on our current planning, we do not anticipate a
tax burden in the foreseeable future. As a result
no provisions for taxes were formed.
Due to the completion of Terminal 2, total other
provisions of €156.8 million include, for the first
time, €54.9 million for infrastructure construction work still awaiting final billing. Other key
provisions include €22.6 million for conditionally
paid landing fees, €12.8 million for residual
vacation pay, overtime and flextime compensation, an €11.8 million contingency reserve for
rental losses, and €10.2 million for settlement
backlogs and future obligations in connection
with partial retirement arrangements.
Other provisions include €9.7 million for marketing activities, a €6.8 million contingency reserve
for the possible reclamation of permission fees,
and €4.6 million for cleanup and remedial work
following water damage in the central area.
Other operating income includes €9.7 million
from the sale of land. This was booked as a special reserve item not affecting income in accordance with Section 6b of the Income Tax Code.
Additional operating income items include €3.2
million from the provisioning of water, wastewater, and power-supply infrastructure for Terminal
2, €3.2 million in transferred charges for vacant
capacity in Terminal 1, €2.3 million from the
reversal of provisions, €1.3 million in insurance
payouts, and €1.2 million from long-term building rights.
Due to the completion of Terminal 2, which
opened on June 29, Flughafen München GmbH’s
materials costs for the first time included a
charge of €31.3 million for services relating to
terminal capacity provisioning in fiscal 2003.
7 Contingencies
To cover and secure all claims in connection
with MediCare Flughafen München Medizinisches Zentrum GmbH’s current and future liabilities to the Kreis- und Stadtsparkasse ErdingDorfen bank, Flughafen München GmbH in 2003
posted unlimited surety.
8 Other financial obligations
Other key provisions include €3.9 million for
neglected maintenance obligations, €3.3 million
for outstanding invoices, and €2.6 million for
repair and refurbishment of the flooring in
Terminal 1.
5 Liabilities
(see table facing)
54
Existing real-estate lease contracts are expected
to incur costs of around €46.8 million in 2004.
The burden through to the end of the basic lease
term will amount to €518.8 million.
Existing construction, supply and service contracts and agreements with planners, architects
and engineers pertain essentially to ongoing
business operations and are of a scope consistent with such operations. There are also additional obligations for environmental protection
measures and the honoring of public-law requirements.
9 Net result
Having reported a net income of €0 in fiscal
2002, the company made a net loss of €51.15
million in fiscal 2003.
Details of share ownership
Seat
Share of
Capital
Result for
capital
stock
the year
%
€ thousand
€ thousand
eurotrade
Flughafen München Handelsgesellschaft mbH
Munich
74.0
13
01
Allresto
Flughafen München Hotel und Gaststätten GmbH
Munich
100.0
26
01
Cargogate Flughafen München
Gesellschaft für Luftverkehrsabfertigung mbH
Munich
100.0
511
01
CAP Flughafen München Sicherheits-GmbH
Freising
76.1
355
185
aerogate München
Gesellschaft für Luftverkehrsabfertigungen mbH
Munich
100.00
598
(78)
EFM – Gesellschaft für Enteisen und
Flugzeugschleppen am Flughafen München mbH
Freising
49.0
2,185
552
FMV – Flughafen München
Versicherungsvermittlungsgesellschaft mbH
Freising
51.0
26
01
FM Terminal 2
Immobilienverwaltungsgesellschaft mbH & Co oHG
Freising
60.0
25,000
02
AeroGround
Flughafen München Aviation Support GmbH
Munich
100.0
250
01
MediCare
Flughafen München Medizinisches Zentrum GmbH
Oberding
51.0
(172)
(323)
Augsburger Flughafen Betriebs-GmbH
Augsburg
50.0
52
(1)
Oberding
60.0
3,025
02
Freising
100.0
15,025
01
Terminal 2 Holding GmbH
1 Profit transfer agreement
2 Losses transferred on account of shareholders’ agreement
Liabilities table
December 31, 2002
December 31, 2003
Residual term
up to 1 year
1 to 5 years
€
€
€
€
€
327,752,746.83
84,497,167.35
112,837,203.24
130,418,376.24
313,069,468.74
Trade accounts
payable
20,364,827.65
18,504,995.22
1,859,832.43
0.00
24,527,456.94
Liabilities to associated
companies and
subsidiaries
35,983,360.16
35,983,360.16
0.00
0.00
23,616,748.68
Liabilities to
banks
over 5 years
21,856,659.50
6,338,138.13
15,011,957.22
506,564.15
30,536,923.39
(14,303,088.33)
(273,239.11)
(14,029,849.22)
(0.00)
(14,300,648.69)
of which in taxes
(3,324,591.06)
(3,324,591.06)
(0.00)
(0.00)
(2,671,115.35)
of which in social
welfare
(115,050.36)
(115,050.36)
(0.00)
(0.00)
(752,390.04)
405,957,594.14
145,011,951.96
130,020,701.79
130,924,940.39
391,750,597.75
Other liabilities
of which to insurance
companies
55
Annex
III. Additional information
Federal Republic of Germany
Members of the executive board:
Peter Keidel
Director-General,
Federal Ministry of Transport,
Building and Housing, Berlin
Dr. Michael Kerkloh, President and CEO
Walter Vill, Vice President
Peter Trautmann
Dr. Dieter Knoll
Ministerial Councilor,
Federal Ministry of Finance, Bonn
2 Supervisory board
City of Munich
Members of the supervisory board in 2003:
Christian Ude
Chief Mayor, City of Munich
1 Executive board
Prof. Kurt Faltlhauser
Minister of State,
Bavarian State Ministry of Finance, Munich
Chairman
Oliver Gebauer
Personnel management clerk
Employee representative
Vice chairman
Free State of Bavaria
Hans Spitzner
Undersecretary,
Bavarian State Ministry for Economic
Affairs, Transport and Technology
Gerhard Flaig
Director-General,
(supervisory board member until Nov. 5, 2003)
Klaus Weigert
Director-General,
(supervisory board member from Nov. 13, 2003)
Hans Hermann Schneider
Director-General,
Board of Building and Public Works
in the Bavarian State Ministry of Home Affairs
(supervisory board member until Jan. 31, 2003)
Josef Poxleitner
Director-General,
Board of Building and Public Works
in the Bavarian State Ministry of Home Affairs
(supervisory board member from Feb. 12, 2003)
56
Dr. Reinhard Wieczorek
Councilor, City of Munich
Employee representatives
Josef Bals
Cook
Thomas Bihler
Clerical employee
Heinrich Birner
Director of the ver.di labor union,
Munich region
Georg Herrmann
Certified aircraft handler,
full-time works councilor
Orhan Kurtulan
Certified aircraft handler,
full-time works councilor
Otto Siegl
Clerical employee
Gerhard Halamoda
Managing director, Allresto
(supervisory board member from Jan. 30, 2003)
3 Remuneration of and loans granted to the
supervisory and executive boards
Remuneration of the supervisory board totaled
€16,400.
Former members of company management
received remuneration totaling €471,600.
Provisions of €6.48 million were formed for future pension payments and accrued pension
rights of surviving dependants.
Executive board members’ remuneration totaled
€713,200 in fiscal 2003.
5 General
Section 9 of Germany’s Energy Industry Act,
which passed into law on April 29, 1998, requires
public utility companies to draw up separate
balance sheets and income statements for their
power generation, power transmission and
distribution activities and for their non-power
activities.
Given that revenue from power business
accounted for just 1.5 percent of total sales
(2002: 1.1 percent), we have chosen not to report
separately on our power activities, just as a year
earlier, as these are deemed not to be significant.
4 Employees
As per Section 267, Paragraph 5 of the German
Commercial Code, the workforce comprised, on
average, 2,007 salaried employees, 12 casual
workers, 2,157 wage employees and 466 casual
workers in fiscal 2003. In addition, 99 apprentices were undergoing vocational training with the
company.
Munich, May 27, 2004
Dr. Michael Kerkloh
Walter Vill
Peter Trautmann
57
58
Supervisory board’s report
The supervisory board was informed regularly
and in detail by executive management through
written reports and at meetings about the company’s situation, its development, and important
business events. On the basis of the reports and
the information received, the supervisory board
monitored the management of the company’s
business and made such decisions as it was
called upon to make in accordance with its statutory responsibilities.
The year-end accounts as per December 31,
2003, and the report on the economic development and position of Flughafen München GmbH
and its group of companies presented by executive management have been audited and approved by Deloitte & Touche GmbH, the appointed auditors. Having conducted its own review,
the supervisory board accepts the auditors’ findings and raises no objections. In accordance
with Section 42a, Paragraphs 2 and 4 of the
Limited Liability Companies Act (GmbHG) and
Section 171, Paragraph 2 of the Stock
Corporations Act (AktG), the board approves the
year-end accounts of Flughafen München GmbH
and the FMG Group. The supervisory board proposes that the shareholders endorse the yearend
accounts of Flughafen München GmbH and the
FMG Group.
In fiscal 2003, Mr. Hans Hermann Schneider and
Mr. Gerhard Flaig left the supervisory board. We
wish to thank both gentlemen for their expert
and committed service to the company.
The supervisory board also wishes to express its
gratitude and respect for the work carried out
and the successes achieved by the company’s
executive management and employees in fiscal
2003.
Munich, July 29, 2004
The supervisory board
Prof. Kurt Faltlhauser
Chairman
59
Flughafen München GmbH, Munich
Balance sheet as at December 31, 2003
Assets
€
€
Dec. 31, 2003
2002
€
€ thousand
A. Fixed assets
I. Intangible assets
1. Franchises, intellectual property,
and similar rights and assets
2. Advances on intangible assets
2,181
2,376,158.80
530
0.00
2,711
2,376,158.80
II. Tangible assets
1. Land, rights similar to land, and buildings,
including buildings on property
owned by others
1,780,944,445.54
1,649,552
311,302,456.55
211,898
3. Other equipment, plant and
office equipment
24,602,080.78
24,627
4. Construction in progress and advances on fixed assets
11,788,912.44
2. Technical equipment and machinery
181,003
2,128,637,895.31
2,067,080
III. Financial assets
1. Investments in subsidiaries
19,537,562.32
19,537
2. Investments
802,699.07
803
3. Other loans
863,269.74
904
21,203,531.13
21,244
2,152,217,585.24
2,091,035
B. Current assets
I. Inventories
1. Substitute plots of land
27,167,116.84
2. Raw materials and supplies
5,289,078.69
26,111
5,430
32,456,195.53
31,541
II. Receivables and other current assets
1. Accounts
receivable
22,490,986.20
19,555
2. Amounts due from
subsidiaries
36,371,276.92
16,458
528,682.70
13
3. Amounts due from associated
companies
4. Other current assets
of which €9,360,022.06 due from
shareholders (2002: €0.00)
13,829,247.26
10,496
73,220,193.08
III. Liquid funds
C. Prepaid expenses
Total assets
60
46,522
10,692,766.85
7,800
116,369,155.46
85,863
432,179.85
586
2,269,018,920.55
2,177,484
Liabilities
€
Dec. 31, 2003
2002
€
€ thousand
A. Capital stock
I.
Subscribed capital
II. Capital reserves
III. Earnings reserves
Other reserves
IV. Balance-sheet loss (2002: balance-sheet profit)
306,776,000.00
306,776
102,258,376.24
102,258
596,812.29
597
0
51,151,921.53
B. Conditionally repayable shareholder loans
C. Special reserve items (Section 6b, Income Tax Code)
358,479,267.00
409,631
1,276,226,461.37
1,276,226
9,663,014.13
0
D. Accrued liabilities
1. Provisions for pensions
2. Other provisions
10,308,000.00
9,790
156,821,575.84
88,600
167,129,575.84
98,390
E. Liabilities
1. Liabilities to banks
327,752,746.83
313,069
2. Trade accounts payable
20,364,827.65
24,528
3. Liabilities to subsidiaries
35,737,078.92
23,436
246,281.24
181
4. Liabilities to associated
companies
5. Other liabilities
of which €3,324,591.06 in taxes
(2002: €2,671,115.35)
of which €115,050.36 in social welfare
(2002: €752,390.04)
F. Deferred income
Total liabilities
21,856,659.50
30,537
405,957,594.14
391,751
51,563,008.07
1,486
2,269,018,920.55
2,177,484
61
Flughafen München GmbH, Munich
Income statement for the fiscal year
from January 1 to December 31, 2003
€
1. Net sales
2. Other capitalized labor, overheads and material
3. Other operating income
2003
2002
€
€ thousand
593,270,387.15
555,488
956,781.69
411
29,043,099.28
17,695
623,270,268.12
573,594
4. Materials costs
a) Supplies, raw materials
and merchandise
b) Purchased services
-31,361,283.75
-26,184
-128,251,123.37
-83,844
-159,612,407.12
-110,028
5. Personnel costs
a) Wages and salaries
b) Social security, pension costs
and support
of which €12,543,802.68 for pension plans
(2002: €9,124,579.51)
-154,449
-173,279,137.92
-47,271,523.93
6. Depreciation and amortization on intangible
and tangible assets
7. Other operating expenses
-39,263
-220,550,661.85
-193,712
-98,174,757.31
-105,742
-137,087,181.78
-111,238
-615,425,008.06
-520,720
7,845,260.06
52,874
8. Income from investments
of which €96,560.67 from associated companies
(2002: €94,862.46)
586,560.67
375
9. Income from profit transfer agreements
616,916.36
5,920
10. Expense from loss transfers
-40,186,269.33
-22,238
11. Income from financial assets
34,469.50
35
1,990,280.89
1,577
12. Other interest and similar income
of which €1,571,811.15 from associated companies
(2002: €1,083,889.04)
13. Interest and similar expense
of which €313,679.88 from associated companies
(2002: €192,804.88)
-29,035
-21,123,012.13
-58,081,054.04
14. Results of ordinary operations
15. Taxes on earnings
16. Other taxes
17. Net profit/loss for the year
18. Loss carried forward from the previous year
19. Balance-sheet profit/loss
62
-43,366
-50,235,793.98
9,508
-78,071.89
-2,039
-838,055.66
-952
-51,151,921.53
6,517
0.00
-6,517
-51,151,921.53
0
Publisher:
Principal Department for
Finance and Accounting
Tel.: +49 (0)89/975-00
Fax: +49 (0)89/975-3 10 06
Concept/editor:
Dr. Reingard Schöttl
Public Relations Department
Postfach 23 17 55
85326 Munich
Germany
www.munich-airport.de
Photographs:
Roland Albrecht
Alex Tino Friedel
Getty Images
Dr. Werner Hennies
Image Source Grande
Kempinski Hotel Airport München
Martin Ley
Zefa
Design:
Pantos Werbeagentur GmbH, München
Printing:
Holzmann Druck GmbH & Co KG, Bad Wörishofen
xx

Annual Report 2003 - Flughafen München

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