Fraport Interim Report 3rd Quarter 2004: Positive Trend Continues - 2004 Sales and Earnings Forecast Revised Upward / Situation in Air Transport Industry / Requ

Frankfurt/Main, Germany 10.11.2004 (PROTEXT/ots) - Fraport AGFrankfurt Airport Services Worldwide achieved an 8.7 percentincrease in sales to EUR1,487.4 million in the first nine monthsof fiscal 2004. The Group's EBITDA (earnings before interest,tax, depreciation and amortization) of EUR409 million exceededthe previous year's figure by 10.5 percent

Some 58.9 million passengers used the Fraport Group'sairports during the first nine months of 2004, 10.5 percent morethan in the corresponding period last year. Frankfurt Airport(FRA) served 38.8 million passengers, an increase of 6.4 percent.Furthermore, FRA limited landing capacities could be betterutilized: Maximum takeoff weights (MTOWs) - an indicator of thesize of aircraft used - rose by 6.7 percent. At the same time,the seat load factor (i.e., aircraft capacity utilization)increased 2.1 percentage points. Antalya Airport (AYT) in theTurkish Mediterranean benefited from a revival in tourism trafficto this region. Passenger figures at AYT soared by 31.4 percentto 9.8 million. Frankfurt-Hahn Airport (HHN), which focuses onthe low-cost segment, continued its success story by growing 17.4percent to 2.1 million passengers.

Cargo tonnage (airfreight and airmail) handled at FrankfurtAirport reached the record level of 1,334,509 metric tons,exceeding the first nine months of 2003 by 11.1 percent.

In addition to higher proceeds from traffic charges, Fraportalso achieved a noticeable increase in revenue from securityservices, because an EU directive required further tightening ofsecurity procedures at European airports at the beginning of2004. Furthermore, Fraport's ICTS Europe subsidiary, whichspecializes in aviation security services, was able to expand itsbusiness to new customers and new locations.

As a result, ICTS' staff requirements increased. In thefirst nine months of 2004, the company's work force was 10.2percent larger than in the same period of 2003. This manpowerincrease and increases in pay rates were responsible for theGroup-wide increase of 5.5 percent in personnel costs to EUR726million. The Fraport Group's total number of employees averaged23,935, an increase of 2.6 percent over the previous year.

Non-personnel costs grew 9.7 percent to EUR384.3 million,mainly because of increased maintenance and repair costs - inparticular, the terminal modernization and Runway Northrenovation projects at FRA.

Due to stringent cost management, total personnel and non-personnel costs increased by only 6.9 percent and thus did notrise as fast as sales (up 8.7 percent). This productivityimprovement is reflected in a 10.5 percent increase in EBITDA toEUR409 million.

With EUR16 million, the financial result fell EUR18.7 millionshort of the previous year's level. Income from investments wasmarkedly higher in 2003, because it still contained EUR8.5million in dividend payments from Antalya for fiscal 2002. Since2003, such dividend payments have been made "in phase," meaningdividends have been collected at the end of the fiscal year forwhich they are due. Furthermore, financial results for theJanuary-to-September 2004 period were depressed by a negativebalance of foreign currency translations.

The Fraport Group was able to improve profits in the firstthree quarters of 2004 by 10.5 percent to EUR117.2 million,compared to the same period last year. Earnings per shareaccording to IFRS (International Financial Reporting Standards)grew from EUR1.18 Euro to EUR1.30.

In view of the positive development of the operating businessin the first nine months, Fraport is revising its forecast forsales and earnings in fiscal 2004 upward. Fraport expects salesrevenues to grow by at least 7.5 percent and EBITDA by slightlymore than 10 percent. Correspondingly, Group profits are expectedto rise over-proportionately, provided there will be no negativeinfluences during the last few weeks of the year. Fraport AG'sexecutive board plans to increase the payout ratio.

Fraport's executive board chairman Dr. Wilhelm Benderexplained that, the good results not withstanding, Fraport AGwill face heavy challenges over the next few years because ofgrowing costs pressures in the air transport industry. Examplesof such challenges include the prices for ground handlingservices and so-called concession fees at Frankfurt Airport,Bender said. Fraport's ground-handling contract with Lufthansawill be expiring at the end of 2005.

Therefore, it should be in the interest of both contractpartners to find a competitive solution to continue thislongstanding and successful cooperation at Frankfurt Airport in2006 and beyond. Bender pointed out that the company'ssuccessful WM 2005 value enhancement program, which will becontinued, provides an excellent foundation for the months andyears ahead. Nevertheless, further cost reductions will benecessary. "Fraport is economically sound," Bender said. "Basedon this sound position, we are already prepared today to meet theexpected challenges of tomorrow - for the benefit of ourcustomers, our shareholders and for sustained job security."

For More Information, Please Contact: Fraport AG FrankfurtAirport Services Worldwide Robert A. Payne, B.A.A. - ManagerInternational Press Press Office (Dept. UKM-PS), CorporateCommunications (UKM) 60547 Frankfurt am Main, Federal Republic ofGermany Tel.: +49 69.690.78547; Fax: +49.69.690.60548; E-mail:r.payne@fraport.de; Internet: www.fraport.com

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