Airports South Africa building its defense against Covid resurgence

Bloomberg

Airports Company South Africa (Acsa) is looking to generate more income from hotels and land, win service contracts and boost cargo revenue to prepare for a potential fresh wave
of Covid-19 infections and
restrictions.
The state-controlled owner of international hubs including Johannesburg and Cape Town fears a new coronavirus variant may emerge that is vaccine resistant, CEO Mpumi Mpofu said. Alternative revenue streams are therefore vital to ensure the ongoing financial health of the airports group, she said. “It’s the most unpredictable factor,” the CEO said. A variant that undermines inoculations will send the whole industry “back to square one.”
South Africa’s aviation and tourism sector received a boost this month when the UK took the country off its list of banned countries and the US opened borders to vaccinated travellers starting from November 8. That may lead to an influx of holidaymakers over the southern summer months and see a stronger season than thought possible in July, Acsa said.
Even so, preparations for a less favorable scenario are under way, Mpofu said.
“We have an intention to monetise non-core assets, which does not necessarily mean disposals,” she said. “We have hotels, land and facilities at airports.” Acsa is also on the lookout for more contracts with other hubs to provide operational and technical expertise, positioning itself as a “go to” provider for African airports, the CEO said. A final plan is to expand into cargo aviation — one of the clear winners of the pandemic as e-commerce boomed.
Acsa reported a loss of $178 million in the year through March, compared with a profit of 1.2 billion rand a year earlier. The company got through months of almost no traffic by selling a 10% stake in Mumbai airport, issuing 2.3 billion rand of preference shares to the government and taking an 810 million-rand loan from the Development Bank of Southern Africa.