Q1 2026 Fraport Frankfurt Airport Services Worldwide AG Earnings Call - Q&A

May 5, 2026

Speaker #1: Presentations, please keep our cautionary language in mind. Risks and opportunities may arise with forward-looking statements. We also kindly ask you to limit your question to the number of two so that everyone in the line will have the opportunity to raise some questions.

Speaker #1: Having said this, and without further ado, I'd like to hand over to Heidi to command with a question-and-answer session. Thank you.

Speaker #2: Thank you. If you wish to ask a question, please press star one, one on your telephone, and wait for your name to be announced.

Speaker #2: If you wish to cancel your request, please press star one, one again. We will take our first question. The first question comes from the line of Elodie Rall from JP Morgan.

Speaker #2: Please go ahead, your line is open.

Speaker #3: Hi, good afternoon, thanks for coming for taking my question. So my m well, I'll try to limit to two then. so okay, on the, on the presentation, you discussed a lot, the jet supply, jet fuel supply, potential constraints, and that is clearly, downside risk to your guidance.

Speaker #3: So maybe could you elaborate the conversation that you have, with the German government, and on reports on that we've seen on disruptions to supply through the NATO pipeline, and, maybe comment on where the refinery is supplying the pipeline source?

Speaker #3: well, where they source their crude from. That would be quite helpful to understand the risk around the, the jet fuel, supply issue. And just a second, quick question on lufthansa's strikes.

Speaker #3: what kind of, level of disruption did you assume in the rest of your, in the guidance for the rest of the year? Thank you very much.

Speaker #4: Yeah, thank you for your question. Good afternoon also from my side, regarding, your question. What is what's about new regarding availability of jet fuel?

Speaker #4: Clear answer is we don't know. We, we are looking forward based on the working hypothesis that there is always an availability of jet fuel, given we are in close contact with the German government.

Speaker #4: They told and they tell us that there's enough jet fuel available, that there is in the moment no risk. This is the information which we have, and we base all our guidance on these assumptions and these, informations.

Speaker #4: back to facts, when you look on the refinery capacity in Europe, we, that's a problem, so to say, in Europe that we overall refinery capacity in Europe is, below 100%.

Speaker #4: So it's, in the core countries like UK, France, Italy, Germany, it's about 50% own production. So with other words, 50% must come from other sources, wherever these sources are located.

Speaker #4: And, at the end of the day, it's also a question of willingness to pay relatively high prices for jet fuel. And based on this assumption, we assume that the availability is given, of course, based on very high prices.

Speaker #4: Another fact which is given, we, we are receiving jet fuel via two pipelines. Primarily via two pipelines. One pipeline is a so-called NATO pipeline, who is servicing also the US bases with jet fuel.

Speaker #4: And also based on this fact that we have these direct link, we assume that if there would be a shortage, then, of course, there must be a what the people are going to tell a triage, or a priority system.

Speaker #4: And in this perhaps unlikely event that we will be delivered with the highest priority due to the critical infrastructure. case of, of, of our airport.

Speaker #4: Yeah, I think I've lufthansa strikes.

Speaker #3: Mm-hmm, yeah.

Speaker #2: Okay.

Speaker #3: For the guidance for the.

Speaker #4: Yeah, lufthansa strikes. This is, we, we gave a range, and now we made a correction in such a way that today we are saying we are ending up at the lower end of the range.

Speaker #4: And this has to do exactly with, with lufthansa. Let me say on the good side, we see, as planned and as scheduled, the ramp-up of the capacity of Condor.

Speaker #4: So they are so to say delivering what they have promised. we also see positive elements from other airlines. For example, yesterday, we received the information that the German government has together with a Chinese government has increased the bilateral numbers of flights from and to Germany.

Speaker #4: So for example, now Air China up from now are increasing their frequencies, Frankfurt to Beijing from 10 to 12 frequencies. China Eastern is going to increase up from the 7th of June from 7 to 9 frequencies.

Speaker #4: Frankfurt to Shanghai, we have China Southern going from 3 frequencies to 7. And increasing, Guangzhou on one side and opening a new route to, Urumqi.

Speaker #4: So these are good news. And so we will see more incoming traffic from China. This is good for the number of passengers is always good.

Speaker #4: It's also good for the purchasing power inside our shops. So these are the good news. on the bad side, so to say, on the negative side, we have the reduction of lufthansa, and we have to see what is the net impact.

Speaker #4: We assume still a positive increase of offered seats during the full year. but of course, not these volume which we had in mind when we made our financial plan in the beginning.

Speaker #4: That's the reason why we have a little bit reduced the guidance regarding the passenger expectation for Frankfurt airport. At the end of the day, we have a seat capacity on increase of seat capacity, which is lower than this, what we assumed in the beginning of the year.

Speaker #4: On the other side, we have the question mark regarding seat load factor. This is always the second variable in this system. But we are still optimistic that we will see a, a lower but solid growth of passengers at Frankfurt airport.

Speaker #4: And always subject to these base assumption that jet fuel is available.

Speaker #3: Okay, thank you.

Speaker #4: So far, my answers.

Speaker #2: Thank you. We will take our next question. The question comes from Carlos Caburrasi from Kepler Chevreau. Please go ahead. Your line is open.

Speaker #5: Hi, Matthias. Hi, Florian. Thank you for taking my questions.

Speaker #2: Hi.

Speaker #5: first, I, I was wondering if you could give us some indications of the early days of Terminal 3 in terms of retail and commercial trends.

Speaker #5: I was just wondering if the performance so far is in line with your expectations. And if you could quantify the improvement you have observed.

Speaker #5: What happened passenger basis? And second, a follow-up on what we you were just discussing on airline capacity. I mean, given what you've mentioned about Condor's plan, I assume there's no risk at all.

Speaker #5: But I was just wondering if you've had any discussions with them regarding a potential delay in the location of new aircraft or something like that due to the jet fuel uncertainties.

Speaker #5: Thank you.

Speaker #4: Yeah, first, first question, retail performance in T3. So what we have today is today is the second wave has been reallocated from Terminal 2 to Terminal 3.

Speaker #4: And further two waves will happen in the next, six, weeks. So this what we have now as data is, is anecdotal evidence. But because the, the number of passengers, the volumes are very low, and you have to see the first wave was, was determined by Middle East carriers, which have given the crisis and the war in Iran relatively low seat load factors.

Speaker #4: In the moment. So the number of passengers is not the biggest one, but the, the first, sentiment or feedback from, from retailers is, is positive.

Speaker #4: But again, this is anecdotal evidence. We have to see when all the waves are through, what are the final numbers. But again, in the moment, it's, it's it looks very positive.

Speaker #4: and again, numbers we will have when the fourth wave is through, then we have the first weeks with, on an annual basis and 10 million passengers.

Speaker #4: So the, the whole bunch of, of airlines reallocated, and then we will see in the first weeks what is the final outcome of, of our new concepts and new marketplace.

Speaker #4: regarding Condor, there is no threat of, availability of new aircraft. Because they, they just run A330neos on one side for the long haul. Destinations and on the other side, they have A320, A321s also neos for Con as well as domestic flights.

Speaker #4: so the, the short haul aircrafts are there. They, they are increasing by reallocating aircraft from other German airports to Frankfurt. So it just, it's just a management decision.

Speaker #4: And regarding the long haul fleet, they are expecting how many is it? How many A330?

Speaker #5: eight further.

Speaker #4: Eight further, A330s. And coming from.

Speaker #5: Okay, one second. From Airbus, there's what we have heard, there's absolutely no risk that there will be a delay. So with other words, the, the ramp-up path of Condor is given.

Speaker #5: Is, is protected by the delivery pipeline of Airbus. And we don't see any risk or threat that they are not delivering what they have promised to us.

Speaker #2: Okay. Thank you, Matthias.

Speaker #4: Jet fuel availability is, is again the same as lufthansa. Jet fuel is given or is not given. But we assume that, it's always given in the next couple of months.

Speaker #2: Okay. Okay. Good. Thank you.

Speaker #3: Thank you. We will take our next question. And the question comes from Graham Hunt from Jefferies. Please go ahead. Your line is open.

Speaker #5: Yeah, thanks very much. two questions from me, please. Just again, staying on jet fuel, apologies. but maybe if we could just go to the, to the other platforms in your portfolio and, and just give us a little bit of color in terms of, maybe the conversations you've had there with the local, governments and, and the status of availability, just in your other major international, assets.

Speaker #5: And then, second question, just on retail. So Q1, spend per pack in the shopping was sort of similarly weak as we ended 2025. But now with T3, a little bit more traffic coming from China, could we see that trend sort of bottom out and turn positive for the rest of the year?

Speaker #5: Is that what you what, what we should be expecting? Just, just wondering what you're seeing there on the shopping spend per pack, which has been weak for some time now.

Speaker #5: Thanks.

Speaker #4: Yeah, first, starting again with a jet fuel availability in our international portfolio, when you look on the Americas, there's absolutely no problem why? Because North America as well as South America, they are producing oil.

Speaker #4: They are net exporters, and they have also, sufficient refinery capacity to transform oil into jet fuel. So with other words, they are not impact there's no exposure regarding Iran war, war.

Speaker #4: Of course, they have to pay also higher prices because it is a world market price and a world market. But availability in the Americas is given.

Speaker #4: look going to, to Europe, coming back to this, what I said, 50% refinery capacity in the main countries regarding Greece. We have heard that increase itself, the refinery capacity is higher.

Speaker #4: So that's, ease from a theoretical, perspective, the exposure, ex-exposure should be lower. And, regarding Asia, this is we don't have we don't run an airport in Asia, but we have, of course, a destination destinations going to and from Asia.

Speaker #4: Here, it's a little bit unclear. what is going on in China and India, South Korea. Normally, these are countries who are net exporters of jet fuel because they have a, a huge, jet fuel refinery capacity.

Speaker #4: So it's not the problem of refinery capacities in these countries. It's a question is enough oil over there to use the oil in the refineries to pro-produce a jet fuel.

Speaker #4: So what we have heard behind the curtain, they are producing like hell and, and increasing their, their storages to be protected in a case that a worst-case scenario should happen.

Speaker #4: So it's a little bit unclear what is going on in, in Southeast Asia. But, in the moment, we also don't expect any hiccup over there.

Speaker #4: retail, retail, we have a, a different let me say situation. If, if you make a further drill down of the spend per pack number, going to the to the several items, we have F&B is running very well, media is extremely running good.

Speaker #4: services is good. parking itself, besides spend per pack, is always good. So the only also fashion is relatively good. So the, the only and main problem is, the revenues in, in duty-free slash, travel value.

Speaker #4: Here we have a significant reduction. And we are sitting together with Heinemann Brothers who are managing especially, travel value at duty-free. places what, what to do in the future to improve the situation.

Speaker #4: So it's a really, differentiated situation which we have in the moment. We have a lot of good things, and we have one main item who is responsible for the reduction in the spend per pack.

Speaker #4: And again, this is duty-free slash travel value. Products. And of course, China will help us now. This is what I mentioned, this increase of frequencies.

Speaker #4: This is, in favor of us. And, also the coming back of the Middle East traffic. So we, we know from the airlines, for example, Emirates, they are back on, on two frequencies per day.

Speaker #4: I think in next or next two weeks, they are coming, back to the, the three frequencies per day, which they had before the crisis and before the war.

Speaker #4: Today, I can see already the A380 coming back to, to Frankfurt. We have heard from the management team here in Frankfurt from Emirates that the seat load factor is relatively good now, coming back from low numbers.

Speaker #4: So that we expect, a relatively good recovery, always subject to what will happen with the war over there. but the, the current information flow from these airlines is, is, relatively optimistic.

Speaker #4: So bring it all together we are not pessimistic regarding the next couple of months.

Speaker #5: Thanks.

Speaker #6: Thank you. We will take our next question. The question comes from Tobias from me, from Bernstein. Please go ahead. Your line is open.

Speaker #5: Hello. thank you for taking my questions.

Speaker #6: Hello.

Speaker #5: The first one is on traffic. I just wanted to hone in on the load factor. How much of your sort of hopes to hit the lower end of the guide is based on an elevated load factor for the rest of the year?

Speaker #5: And then secondly, on ground handling. When I particularly look at the ground handling revenues, 10% RB over year, is that the trajectory that we should expect for the rest of the year, or as the comms basically get stronger, do you expect that to be a little bit lower than the 10%?

Speaker #5: Thank you.

Speaker #4: Yeah, load factor, we, we assume as of today a constant load factor, compared to the pre-previous year. This is what, what I mentioned. This is a little bit the question mark.

Speaker #4: We have on one side the seats capacity increase. We still expect an increase. Then the question is, will this be supported by, seat load factor increase?

Speaker #4: What we saw during the beginning of the war when the direct flights to, to Middle East destinations have been stopped. So the traffic was looking for other ways.

Speaker #4: And this led to a situation that, on other routes, to the east, to eastern destinations, the seat load factor went up. We have to, to look whether this is sustainable or just a temporary phenomenon.

Speaker #4: but I would say from a from a today's perspective, there could be an upside chance in the moment. I don't see a downside, risk.

Speaker #4: But again, this is always jump subject to, to a geopolitical topics, which might come occur overnight. Ground handling here, we, we are happy. with the performance, you know, already last year, the team in the segment showed a good performance.

Speaker #4: based on gaining or regaining higher, market share on one side, productivity on the other side, also price increases with a lot of customers, which we have in our portfolio.

Speaker #4: This continues this, this year. Also, the ridiculous wage increases are over now. We have we still have to hire wage increases. But not any longer double-digit numbers.

Speaker #4: And this combination, more volumes, above the normal growth rates because we are gaining market share. In combination with productivity increases, led and, lead to a situation that despite, relatively high mid single-digit wage increases, we were able to improve, our numbers.

Speaker #4: You saw now the Q1 numbers, which are clearly better than, the previous year. And, guidance was flat, but there is some chance or probability that at the end of the year, we will end up with a with a better number.

Speaker #4: So above previous year. But again, this is not a new guidance, but just showing, a chance which we see in the segment.

Speaker #5: Thank you.

Speaker #6: Thank you. Once again, if you wish to ask a question, please press star one, one on your telephone. We will take our next question.

Speaker #6: And the question comes from the line of Christian Nedelcu, from UBS. Please go ahead. Your line is open.

Speaker #5: hi. Thank you very much. two questions on ground handling, if possible. Please, the, the first one, the could you tell us, is there any update on the negotiations on the contract for ground handling with, with Lufthansa?

Speaker #5: one would assume in the current environment, Lufthansa may be a bit more demanding when negotiating for, for that contract. But, yeah, any, any color or, or, you, you could provide there and in terms of your expectations of, the outcome of that contract.

Speaker #5: And secondly, could you tell us a bit how, how do you plan your, in-ground handling? How do you plan your workforce through, through the summer, the number of FTEs, versus the prior year?

Speaker #5: I'm, I'm just asking from the perspective that it seems that the airlines are adjusting capacity more often than, than they usually do over the last couple of months.

Speaker #5: so it seems, at least from, from outside, it seems that it may be challenging to, to find a balance between the right number of employees and the, the, the, the exact number of flight takeoffs and landings that you will see.

Speaker #5: So is that challenging? How, how are you thinking at the FTE growth year over year? Any, any more color there, would, would help. Thank you.

Speaker #5: Mm-hmm.

Speaker #4: The first question, what is the situation regarding the contractual situation? So we are in now in, in close contact with Lufthansa. We are in close negotiation.

Speaker #4: We showed them our losses in the last couple of years with this contract. It's a huge cumulated loss, which we had. And this was, so to say, a subsidy for Lufthansa.

Speaker #4: And we said the parties are now over. up from 1st of April next year, there must be a full cost coverage with the new contract.

Speaker #4: And based on these, and we showed what our have been our losses, what is the gap. And what is the percentage to close the gap?

Speaker #4: This is on the table. We said there's no headroom to discuss because we are not any longer willing to, to pay subsidies. for making a business, for, for a partner of us.

Speaker #4: So they have to accept it or not. Full stop. There's nothing in between. And, we, we have also there is no potential for us to say, "Yeah, we find a compromise." There is no compromise.

Speaker #4: The result is cost covering or no contract. So, workforce in summer, this is a it's a good question because having in mind that the or one thing is clear there.

Speaker #4: The growth will not be in such dimension what we saw in the beginning of the year. So with other words, our resource plan is not any longer valid.

Speaker #4: And we have immediately reacted and, so to say, overnight, we stopped further recruiting in ground handling. To, to adapt, so to say, the workforce to the reduced growth, expectation now, also especially during the summer season.

Speaker #4: And with other words, looking on the, the whole, workforce here, at Frankfurt Airport, it's a whole site. We see, of course, a further increase in Q2.

Speaker #4: But this has to do with Terminal 3, which has a much greater and bigger dimension like Terminal 2. So this is a, a necessary number of employees to run this huge infrastructure.

Speaker #4: But in ground handling itself, we stopped, the increase of workforce. So we run now the business with this number of employees, which we today have in the segment.

Speaker #4: And with other words, the number of employees now in the middle of this year is a peak. for the for Frankfurt side. And looking forward in the coming years to 2030, this is not a new information.

Speaker #4: Now we are going then to reduce the overall workforce year by year, step by step. Using artificial intelligence, robotics, digitization of things and also, in combination with further product productivity measures, to bring down step by step.

Speaker #4: The workforce, to have a, a compensation element against future expected wage increases, which will not come down to a level which would be necessary, so to say, to, to run the German industry.

Speaker #4: On a on a efficient basis.

Speaker #5: Thank you very much.

Speaker #6: Okay. We will take our next question. And the question comes from the line of Andrew Lobbenberg from Barclays. Please go ahead. Your line is open.

Speaker #7: Oh, hi there. can I ask about Lima? it seems to have a underperform. You've built a beautiful new airport and beautiful runways. and we don't have many people there.

Speaker #7: what is the, the prospect for, for getting that going and, and driving the full economics of that? And then, I mean, can I just come back to the handling negotiations with Lufthansa?

Speaker #7: You're, you're sounding all tough. And you've got to break even and they've got to take it all, or, or have no contract. But, you know, they do like to, highlight their multi-hub strategy and their ability to redeploy capacity around the place.

Speaker #7: And whilst you've got stability with the airport charges on a four-year contract, this is potentially, you know, a, a significant increase in their cost per turn at Frankfurt.

Speaker #7: That could make Frankfurt less attractive to them at the margin. are you not concerned about that? Or does it fit into some bigger broader part of the relationship with Lufthansa?

Speaker #7: Thanks.

Speaker #4: So first of all, we think we have a good and productive and cooperative relationship to Lufthansa. Regarding a service which we are offering, I think it's absolutely clear that at the end of the day, it's we are talking about a personnel-intensive business.

Speaker #4: It's, it's, it's a body lease. You have 70% of our OPEX and ground handling is, is determined by, by the workforce. That at the end of the day, who, whoever will use this service, he has to pay for the OPEX.

Speaker #4: And, this will be a significant step, step up. But due to the fact that, as I mentioned, we, we subsidize this service in the last five years, in favor of Lufthansa.

Speaker #4: This is now over. And so we the only thing what we expect from them is to pay a fair price for the costs which are there, which are given.

Speaker #4: And you mentioned the multi-hubbing system. So you know that, also the second largest hub of Lufthansa is Munich. In Munich, Lufthansa made a decision.

Speaker #4: I think this was one year ago. To make a self-service regarding ground handling. So in former times, they have been serviced, first of all, by, by Munich Airport.

Speaker #4: Then I think they switched over to, to Swissport. Then they canceled the contract. And now they are doing their own ground handling. What I have heard, and this is not a surprise, that the costs of doing the service on your own account is extremely high.

Speaker #4: So everybody is free to choose. And, everybody is, is responsible for his own fate, so to say. And, again, they can use our service.

Speaker #4: And they can do it for their own. Or it can go to other service provider. If they would go to another service provider, then we are stopping our business is also okay.

Speaker #4: But we are not willing to, to continue with subsidizing an airline. So I think this is absolutely clear. and I think Lufthansa is also aware of this.

Speaker #4: So first question was regarding Lima. Was it correct? Was it difficult because in, in the line, there was always a, a background noise? And, so it was difficult to understand your question.

Speaker #4: So Lima itself, you know, CAPEX is through, which is good. Now we have a brilliant infrastructure with a capacity up to 40 million. In the moment, the, let me say, the financial result or coming with the with the final result, the financial outcome in '26 will be as expected.

Speaker #4: So a clear and significant improvement compared to the EBITDA number from last year. But nevertheless, the growth in the moment is not in line with this, what we expected.

Speaker #4: This is but this has nothing to do with, with the, the airport, which is brilliant. This has to do with some airlines. And who are reallocating, have some topics and, we assume that these that this is a temporary phenomenon.

Speaker #4: And the airlines or one of these airlines is coming back or going back to the old growth plan. So that the, the weakness in the passenger numbers in Lima regarding the expected growth rates is just temporary.

Speaker #5: And you don't think it links to the dispute over connecting fees? Or does it? And you think it'll just come to terms with it?

Speaker #4: This is we are, we are talking about an amount of money which is compared to jet fuel costs to all this is nothing. So it's, it's, it's a joke, yeah?

Speaker #4: And, I don't know why this topic is, is, is, is raised. And i-it's an it's, it's a OPEX. It's, it's not relevant. And this is not the reason for the, the growth weakness in the moment.

Speaker #4: Of course, it's a nice try to bring down fees. and perhaps I would do the same. But this is not the explanation why they are not growing in the moment.

Speaker #4: It's, it's the same if you look now. If, if you talk about generally about airport fees, if you look now, we have regarding jet fuel prices, we have, we have a price increase of significantly nearly 200% increase, yeah?

Speaker #4: This has a huge impact on the P&L. And if you, if you take this number, now the current, the current jet fuel prices and, you know, and, and, and long-haul airline has 30 to 40% OPEX, based on, on jet fuel prices.

Speaker #4: And if this double overnight, then you have a real impact. But there are still flying, of course, perhaps with lower growth rates or no growth rates.

Speaker #4: But then talking about 50 cents, airport fees, this is really comedy.

Speaker #5: Okay. Thanks.

Speaker #6: Thank you. We will take our next question. Your next question comes from the line of Martin. Vital from Bank of America. Please go ahead.

Speaker #6: Your line is open.

Speaker #4: We can't hear you.

Speaker #6: Martin, your line is open. Please ask your question. Can you check you've not muted your line? If you're happy, we will move to the next question.

Speaker #4: Yeah. We, we can move on to Nicolas.

Speaker #7: Can you hear me now or?

Speaker #4: Oh, Martin, yeah, now. We can.

Speaker #7: Now, now. Okay. That's okay. Apologies. I had some technical problems here. All right.

Speaker #4: No problem. No problem.

Speaker #7: But, okay. So let me let me ask the question. So, I think we are seeing an environment of, airline ticket prices which are rising, airline ticket prices.

Speaker #7: And potentially could rise, even further. And that is obviously because of the elevated, jet fuel price, what is your view on price elasticity of demand?

Speaker #7: should, shouldn't there be some demand destruction if, if we are going to see significant double-digit increases in, in airline ticket prices?

Speaker #4: Yeah. Sure. I, I first of all, there is a negative price elasticity. So with other words, whenever ticket prices went up, we have a negative impact on the demand side.

Speaker #4: Th-this is clear. And this works already now. And that's, the clear explanation why the growth rates at all destinations are lower than this would everybody expected some, months ago.

Speaker #4: This, this is absolutely clear. The question is, is the impact of fuel prices so significant that, given 150, 180 percent jet fuel price increases, the, the absolute amount of passengers is lower than before the crisis?

Speaker #4: Here in the moment, we see as a, as a negative scenario a constant, development of passenger numbers. Or let me say, a reduced growth.

Speaker #4: But in the moment, we can't see markets where the growth numbers are real negative, just coming from, from the increase of jet fuel prices.

Speaker #4: But looking forward, if these high level would continue, it's, it's absolutely for sure that this would have a negative impact on the long-term CAGR regarding, passenger growth rates.

Speaker #4: But not in a way that the CAGR is negative. It's just a reduced positive number then.

Speaker #7: Thank you very much.

Speaker #6: Thank you. We will take our next question. The next question comes from the line of Nicolas Mora, from Morgan Stanley. Please go ahead. Your line is open.

Speaker #8: Yes. Morning, morning. Afternoon, gentlemen. So just two quick ones. First one on I mean, looking just at the big picture and coming out of Q1, so you've got you've got slower traffic at Frankfurt in Maid.

Speaker #8: you've got good ground handling. I mean, where w-what's what gives you the confidence, basically, the guidance to still holding, I think consensus is a bit below.

Speaker #8: So it's a bit, basically, hesitating. where do you think you're doing better than expected? Just, you know, a couple of months ago? Is it just on, on, on your cost handle, just on, on ground handling?

Speaker #8: Just to see where, where we could flex a little bit our, our models. That's the first one. And second one, can you, give us a bit of color on the, the outlook into summer on, on your airports?

Speaker #8: So near, let's say, near conflict zones. So, think about Antalya in Turkey, Bulgaria, maybe even Greece. I mean, what, what are you seeing right now in terms of booking trends?

Speaker #8: Or what are your customers seeing and, and what kind of feedback you're getting? That would be very helpful. Thank you.

Speaker #4: Yeah. First of all, coming with the overall picture regarding our four segments. From a today's perspective, it might be tomorrow total change if some geopolitical things also would change.

Speaker #4: So, you all already mentioned one segment. This is ground handling. Here in ground handling, based on higher market share than, planned, also good productivity, progress, and improvements.

Speaker #4: Here, there's a chance that we even end up better than, guided in the beginning of the year. So this is an upside. and with a relatively good probability that this will also be the case at the end of the year, regardless what the passenger growth is, why?

Speaker #4: Because what we gained on market share against our competitor is so much more compared to the, the passenger weakness that this is an, an fully overcompensation of this effect.

Speaker #4: So in, in aviation and in retail and real estate, it's based on lower passenger numbers, lower, lower growth numbers. Of course, the, what we have in our internal scenarios, it's lower than this, what we had calculated in the beginning.

Speaker #4: So as a downside, in both, segments, but still a commitment to the qualitative, guidance that, in b in both segments, we are better in, in 26 compared to 25.

Speaker #4: But reduced to this, what we saw in the beginning of the year. And then we have the, the last, segment, international activities. Here, it's in total, always a relatively optimistic outlook.

Speaker #4: But if you go through the several assets, it's different. starting with Americas, in Lima itself, what I mentioned on the OPEC side is good.

Speaker #4: retail is, is, is extremely good. Passenger growth is, is disappointing. but nevertheless, as I mentioned, the, the EBITDA in 26 will be significantly higher than 25.

Speaker #4: in, in Europe, also Brazil is, is, is fine. Both airports, Fortaleza as well as, the other one. And, Porto Alegre. And, Greece, the booking numbers are strong.

Speaker #4: if you look on the traffic numbers in the first three months, are always strong. Also, April, what we have heard preliminary figures are always very good.

Speaker #4: So it seems to be that, we see here a very solid single-digit passenger increase after a couple of years in the past, which showed an overperformance year by year.

Speaker #4: So the show continues. And we are absolutely optimistic regarding, Greece. Bulgaria, yeah, it's, it's also it's improving. Slovenia is doing, you know, the, the passenger numbers in Q1.

Speaker #4: It's always good, but in total, this is not the relevant. But everything is running in the right direction. We have Antalya. It's not part of the EBITDA, but it e-equity, here, the picture is unclear.

Speaker #4: We had a strong March where we will see a weak April. But, determined by a lot of domestic traffic, which is not relevant because the money was generated by the international incoming, traffic.

Speaker #4: And here, we have to see, and the season really starts, May, June. And here, we have to see who is coming and, and, and how many.

Speaker #4: And, this is, Turkey is unclear. what did I forget? Nothing more. So but in total, if you put all the assets together, in average, we see still a clear and significant improvement compared to 25.

Speaker #4: So that's the overall picture.

Speaker #1: All right. Thank you very much, Matthias. Very helpful. Thanks.

Speaker #4: You're welcome.

Speaker #2: Thank you. As a reminder, if you wish to ask a star one, one on your telephone. We will take our next question and the question comes from Jose Emanuel Arroyas from Santander.

Speaker #2: Please go ahead. Your line is open.

Speaker #5: Hello. Good afternoon. two questions, please. one is on the ground handling contract with you expect this contract to be signed? And my second question is on the refinancing strategy and the cost of debt for the next for the re-reminder of 2026.

Speaker #5: as in the past year, there is about, $1 billion of gross debt to be refinanced in Frankfurt. do you expect this, new debt to be more costly or to be about the same it currently is?

Speaker #5: Thank you.

Speaker #4: first topic, again, ground handling contract. normally, the, in the next couple of months, the contract should be closed. Not from our perspective, but from the perspective of Lufthansa because if they don't want to continue with us, they have to change.

Speaker #4: There's only one competitor in the market. This is Swiss Sport. And to, to reallocate a significant number of, of aircraft to another service provider who has a market share of less than 10%, he needs time to prepare himself for this alternative.

Speaker #4: And, even as of today, I have no fantasy if this, this theoretical case of a change from us to another competitor, how this should work.

Speaker #4: But this is again, this is not our responsibility. So to make the long story short, time is running. and Lufthansa, now, should decide what to do because the time is running not in favor of them.

Speaker #4: refinancing cost. we have two elements. We, you know, in average, we have a total cost of debt for the group. 3.4% long-term money. This is a combination of, interest rates here at the Fraport AG balance sheet, which is below 3.4%.

Speaker #4: Then we have indebtedness, project financing, non-recourse at our international assets, of course, with an average interest rate which is higher than 3.4%. So this is a weighted average.

Speaker #4: Looking forward, you mentioned the $1 billion which has to be more or less refinanced year by year. First of all, we are not going to refinance this total amount of money.

Speaker #4: Why? Because now there's a clear decision to go step by step down because we think it's not any longer necessary to have such a high amount of liquidity.

Speaker #4: So with other words, just a part of this refinancing necessity, so to say, is refinanced. The other one is coming from melting down, the existing liquidity.

Speaker #4: And regarding this, what will be brought to the market, we have two phenomena. On one side, our interest margin is becoming lower and lower.

Speaker #4: Because the, the risk of running an airport, compared to other industries in Germany like chemical industry, automotive industry, etc., we, we are in the moment the better debt than other industries.

Speaker #4: And this is in favor of us. So banks are willing to give us the money, to lower margins, which is good of us. Then the unknown variable or the unknown parameter is what will be the shape of the interest rate curve in the next couple of months or quarters.

Speaker #4: Here, you know, everybody expects some increases from the ECB. On the on the, short end, the question is what will be the impact for, for long-term money.

Speaker #4: I would say the probability that the long-term interest rates are going up is a little bit higher. This is our expectation. But the combination of lower, lower margins on one side and higher interest rates on the other side is more or less leveling out.

Speaker #4: So to make the long story short, we see a slight increase of the total cost of indebtedness in the next 18 months. But we will end up with 3.x, or closer to 4%, but not to overcome 4%.

Speaker #4: And, we feel absolutely secured against volatility regarding the, the shape of the interest rate curve.

Speaker #2: Thank you. We will take our next question. The question comes from the line of Christian Coers from Warburg Research. Please go ahead. Your line is open.

Speaker #6: Yes. Hello. Good afternoon. just two questions left for me. First of all, coming back, sorry for that, to the ground handling topic with Lufthansa.

Speaker #6: Assuming that you will not find an agreement with Lufthansa and Lufthansa will go away. Would this actually mean that you will face a major restructuring expense and layoffs in ground handling then, as of next year, or maybe you have to book, large provision at the end of this year?

Speaker #6: And second question relates to, the new border control system that is in place since April. the new entry-exit system. There were various reports about delays and travel chaos at some airports.

Speaker #6: After the implementation, so what is the situation currently in Frankfurt? Are you fine with that?

Speaker #4: Yeah. First of all, again, ground handling, of course, is for this case, I wouldn't say likely or unlikely, that Lufthansa would change the ground handling provider then, of course, we, we have to wind up our business.

Speaker #4: And this would, would be one of the first items. That's, that's for sure. But then I'm also happy. to make it clear. We continue with, with profitability or we, we stop it?

Speaker #4: There's nothing in between. regarding AAS, European Entry System, this is a real problem in Europe. Because the system is not working fine. It's, it's terrible system.

Speaker #4: And, this leads to delays. And we are in a close contact with the federal police here in Germany. How to overcome this problem? It's, it's not a, a simple topic.

Speaker #4: With other words, and, we try to find solutions that these that the introduction of this system, which is not really running in a, in a proper way, that we were able together with the police to handle the system, which is a European problem.

Speaker #4: It's nothing to do with Frankfurt. Each and every airport in Europe has this problem. It's again, a fantastic move of Brussels, huh? But we are always used to, to have such fantastic ideas.

Speaker #4: And, we have to live with it. And we try to overcome the problems. But it's, it's a given problem.

Speaker #6: Okay. Understood. Thank you.

Speaker #4: Welcome.

Speaker #2: There are no further questions at this time. I would like to turn back to Florian Fuchs.

Speaker #5: Yes. thank you, everybody, for the good questions. thank you, Matthias, for the answers. we look forward to being in touch, maybe on the phone, on the web, or on the road.