Turkish airport operator TAV capped 2021 with a net profit of nearly $51.3 million (TL 699.09 million), the company said Tuesday, following pandemic-related losses of the previous year.

The total number of passengers served by TAV Airports increased by 92% compared to last year to 52 million in 2021 as travel bans eased, said the company in a statement, adding that during the same period, TAV’s revenue increased by 73% to 522 million euro ($594 million).

TAV Airports Executive Board Member and CEO Sani Şener, whose views are included in the statement, said, "2021, for us, was a year of significant passenger recovery, massive inorganic growth and value creating corporate actions. We have communicated for a while that the industry has expected the global passenger recovery to be two-pronged, where leisure and short-haul destinations recover the fastest. In line with these expectations, TAV Airports’ passenger recovery toward 2019 levels has been significantly faster than most peers."

Stating that international travel has been gradually normalizing for the last two quarters as COVID-19 vaccine documentation has become mostly sufficient for cross-border mobility, Şener said, "There are still many exceptions to this rule of thumb but the exceptions are decreasing as time passes. Thanks to gradual normalization, we reached the highest levels of passenger recovery in the third quarter since the beginning of the pandemic. The recovery then accelerated during the fourth quarter as more unhindered international mobility became possible."

"With accelerating recovery and contribution of Almaty, we managed to recover 100% of revenue compared to the fourth quarter of 2019. Revenue recovery in the second half of 2021 versus the second half of 2019 was 89%. Through substantial help from the Turkish state, we achieved extensive reductions in our operating expenses. On a like for like basis, without Almaty, our operating expenses were 37% below 2019," said Şener, adding that the total amount of like for like savings in operating expenses that they achieved to make in the last two years reached 363 million euro. TAV owns the Almaty Airport in Kazakhstan.

"As a result of accelerating international passenger recovery, ongoing cost control and contribution of Almaty, earnings before interest, tax, depreciation and amortization (EBITDA) recovery in the second half of the year reached 77% versus 2019 during which we generated significant operational cash. Thus, we can say that we had an excellent recovery in the second half of the year both operationally and financially," he said.

Further commenting on TAV's 2021 profit, Şener said that due to the substantial improvement in EBITDA and one-off income from Tunisian debt restructuring TAV ended the year with a net profit of 45 million euros.

"In addition to achieving very high levels of recovery, 2021 was also a year of achieving massive inorganic growth. During the year, we added Almaty to our portfolio which has generated 19% of consolidated EBITDA in the eight months following its addition in May and has already recovered 68% of pre-pandemic EBITDA. We are working hard to increase Almaty's connectivity and streamline the operations for improved efficiency. We have also closed the debt financing of Almaty from (International Finance Corporation) IFC and (European Bank for Reconstruction and Development) EBRD in the first quarter of 2022 and started to draw down on loan," he said.

Şener also said that besides Almaty, TAV also added another 25 years of Antalya operations to its portfolio in 2021. Expressing they will continue to operate Antalya with a new concession that lasts until the end of 2051 after their present concession ends in 2026, Şener said, "The new concession will have higher rent but it will also have higher revenues and we expect a significantly better retail profile mostly due to the increased retail area. Antalya lies at the heart of Turkish tourism and offers a world-class quality of service. With a great offering, Antalya recovered 92% of international passengers in the fourth quarter versus 2019 and is preparing for a great season in 2022. In 2022, the Turkish Association of Tourism Agents expects tourist arrivals to reach the 2019 level. Antalya’s international traffic, which was growing at 8% per year before the pandemic, offers significant growth potential for the long term as well."

Şener highlighted that 2021 was also a year of significant value creation for TAV, where it received two-year time extensions and rent deferrals for its Turkish airports from the General Directorate of State Airports Authority (DHMI).

"Where we booked a one-off gain of 109 million euro as a result of Tunisia debt restructuring. During the year, we also extended Madinah for up to eight years depending on its speed of recovery," he added.

"As a result of the inorganic growth and time extensions, our average EBITDA weighted concession duration, which was eight years at the beginning of the year, increased to 30 years at year-end. With the recovery we witnessed, the acquisitions we completed and the value we generated, we have created the TAV of the future in 2021," said Şener, pointing out that the current portfolio that they developed in 2021 will continue to produce value for them well into the future.

Stating that TAV's first priority during the pandemic has always been to protect the health of its employees and its guests, Şener said, "I believe that we have achieved this goal with best-practice precautions and remote work. I would like to thank all our employees, shareholders and business partners for their dedicated efforts and continuous support for the TAV brand."

TAV Airports provides integrated services in all areas of airport operations, with a global footprint at 87 airports in 27 countries. A member of Groupe ADP, TAV Airports is part of the leading airport management platform globally. Through its subsidiaries, TAV is active in airport service businesses, including duty-free, food and beverage, ground handling, IT, private security and commercial area management.