SPAIN. In a key development that Dufry said will have a “positive financial impact” on its business, the Spanish Congress of Deputies (Parliament) yesterday passed a law that changes the basis on which concession fees are calculated at all airports, linking them to actual passenger traffic. The changes will stay in place until passenger numbers come back to 2019 levels.
In a big boost to airport concessionaires across the network, the new law states that the Minimum Annual Guaranteed rents (MAG) payable at Spanish airports are not owed for the period between 15 March 2020 and 20 June 2020. In addition, these will be proportionally reduced from 21 June 2020 onwards by comparing the lower volume of passengers at the Spanish airports to 2019 passenger levels. This formula will stay in place until passenger numbers return to those that match 2019.
Dufry runs duty free and duty paid stores at 26 Spanish airports. The new law is expected to materially reduce the MAG claimed by airports company AENA.
Passenger numbers at Spanish airports dropped by around -72% in 2020 and around -68% from January to August 2021, compared to 2019 in each case. Dufry said the P&L impact in 2021 and going forward will depend on the recovery of passenger numbers at the Spanish airports. The company said the specific accounting treatment under IFRS 16 and its timing as well as the impact on the cash flow are currently being reviewed.
