Sydney Airport (ASX:SYD) has released its monthly traffic report, showing positive results for the month of December.
Domestic passenger growth expanded by 5.6% in December, when compared to the preceding month. Moreover, the number of international passengers’ increased 8.6% in December. Total passenger growth yielded 6.7% growth for the month of December.
Overall, for the year 2015, total passengers for the airport grew by 3%, to over 39 million passengers for the 2015 period. Sydney Airport Managing Director and CEO Kerrie Mather attributed this positive passenger growth to strong load factors, along with seat capacity growth.
Positive Foreign and Domestic Passenger Demand
The expansion in foreign nationality demand was one of the main contributors to the growth in international passengers. With the majority of growth coming from Asian passengers, particularly Chinese, Korean, Indian and Singaporean passengers.
Furthermore, Australians travelling abroad grew relatively above trend. With growth in outbound destinations particularly coming from the Philippines, Canada and the UAE.
US airliner American Airlines is now flying daily between Sydney and Los Angeles, in an established partnership with Qantas. The USA is the most popular destination for the Sydney population, and according to Sydney Airport, this will increase capacity between Sydney and the US by 25%, being 225,000 seats annually.
Furthermore, North Western Chinese airliner Hainan Airlines was their sixth new airline to commence services in 2015, running twice a week from Xi’an to Sydney. This marks the first time that North Western China has been directly connected with China. This flight is expected to hold 222 passengers throughout Q12016.
Moreover, China Southern Airlines, on the 28th of January, is commencing a new Shenzhen-Sydney flight, which is set to run three times a week. Having a set capacity of 284 passengers.
SYD performed quite well at the conclusion of yesterday’s trading, up over 4%, to $6.31. SYD has had considerable growth in the last year, on the back of increased partnerships and passenger growth, garnering investors an over 27% return.
Author: Simon Herrmann
Jan 20, 2016
Simon is a financial analyst at independent research firm Wise-owl specialised in small-mid cap growth opportunities and ethical investment opportunities. Simon's aim is to disrupt the cliché approach to investment decision making as he believes that socially and environmentally responsible behaviour is a necessity to long-term wealth creation. Simon has a deep fundamental understanding of the global financial landscape and has compiled 300+ research reports, valuations and corporate appraisals. Simon is commonly featured in major media outlets and his research is published weekly in The Australian.