Press release

The Greater Toronto Airports Authority ("GTAA") today reported its financial and operating results for the three- and nine-months ended September 30, 2023.  Passenger activity significantly increased by 1.3 million or 11.9 per cent to 12.5 million and 8.1 million or 31.6 per cent to 33.8 million during the third quarter and first nine months of 2023, when compared to the same periods of 2022.  Passenger activity increased due to the strong travel demand and the travel industry partners' ability to deliver more consistent levels of services following the pandemic effect that created labour and supply challenges.  During the third quarter and first nine months of 2023, passenger activity recovered to 88.0 per cent and 87.6 per cent relative to the same periods of 2019 passenger activity, respectively.  During the month of September 2023, passenger activity recovered to 91.4 per cent of September 2019 passenger activity.

"In the third quarter of 2023, Toronto Pearson's passenger growth was a robust 11.9 per cent compared to the same period last year, where there was extreme rebound.  There remains a strong demand for air travel and the airport is meeting that demand with more consistent and enhanced service levels across the ecosystem," said Deborah Flint, President and CEO of GTAA. "We are pleased with the significant improvement in the passenger experience, and are focused on improving it further."

Ms. Flint shared, "Summer operations were strong across the board – more predictable, more reliable, more efficient. While the industry continues to face some volatility due to supply chains and labour, operations are more resilient due to several factors, including the launch of the Pearson Standard, which is helping to improve compliance with service standards across the airport. We also advanced use of real-time data and raised departure on-time performance by more than 15 percentage points, as compared to May 1 to September 4 of last summer.  This strong service performance is an important foundation for an expected strong holiday and winter travel season."

Key Financial and Passenger Information

Revenues increased during the three- and nine-months ended September 30, 2023 by $82.6 million to $504.5 million and $305.5 million to $1.4 billion, respectively, when compared to the same periods of 2022, primarily due to the significant growth in passenger and flight activity through Toronto Pearson and, to a lesser extent, the rate and fee increases on January 1, 2023.

Earnings before interest and financing costs, and amortization ("EBITDA") increased significantly during the three- and nine-months ended September 30, 2023, when compared to the same periods of 2022, due to the significant increase in revenues associated with higher operating activity, partially offset by the increase in operating costs (before impairment of investment property and amortization).  Net income during the three- and nine-months ended September 30, 2023 increased by $26.0 million to $99.7 million and $149.1 million to $229.7 million, respectively, when compared to the same periods of 2022, due to significantly higher revenues associated with the increase in operating activity, a decrease in interest expense, offset by a large increase in operating costs during the periods.

Free cash flow increased during the three- and nine-months ended September 30, 2023 by $30.1 million to $207.5 million and $188.4 million to $476.4 million, respectively, when compared to the same periods of 2022, primarily driven by the increase in cash flows from operations and the increase in interest income.  The free cash flow during the first nine months of 2023 also increased from the funds received under ACIP and partially offset by the increase in capital expenditures.

During the three- and nine-months ended September 30, 2023, some notable results from the GTAA's capital investments included:

• approximately 310,000 square metres of airside surfaces, including taxiways, apron slabs, and service roads; and
• increased gate resiliency to support operations and increased traffic demand through the installation of four new passenger boarding bridges at the Infield Concourse bringing total available bridges to ten at that facility.

The GTAA's September 30, 2023 financial results are discussed in more detail in the GTAA's Condensed Interim Consolidated Financial Statements and Management's Discussion and Analysis, each for the three- and nine-months ended September 30, 2023, which are available at www.torontopearson.com and on SEDAR at www.sedarplus.ca.

Caution Regarding Forward-Looking Information

This news release contains forward-looking information within the meaning of applicable securities laws. This forward-looking information is based on a variety of assumptions and is subject to risks and uncertainties. These statements reflect GTAA Management's current beliefs and are based on information currently available to GTAA Management. There is a risk that predictions, forecasts, conclusions and projections that constitute forward-looking information will not prove to be accurate, that the GTAA's assumptions may not be correct and that actual results may differ materially from such forward-looking information. Additional detailed information about these assumptions, risks and uncertainties is included in the GTAA's securities regulatory filings, including its most recent Annual Information Form and Management's Discussion and Analysis, which can be found on SEDAR at www.sedarplus.ca. 

NON-GAAP FINANCIAL MEASURES

Throughout this news release, there are references to the following performance measures which in Management's view are valuable in assessing the economic performance of the GTAA.  While these financial measures are not defined by the International Accounting Standards Board, and are referred to as non-GAAP measures which may not have any standardized meaning, they are common benchmarks in the industry, and are used by the GTAA in assessing its operating results, including operating profitability, cash flow and investment program.

EBITDA

EBITDA is earnings from operations before interest and financing costs, impairment of investment property and amortization.  EBITDA is a commonly used measure of a company's operating performance. This is used to evaluate the GTAA's performance without having to factor in financing and accounting decisions.

Free Cash Flow

Free Cash Flow ("FCF") is cash flow from operating activities, per the consolidated statements of cash flows, and ACIP grants received less capital expenditures (property and equipment, and investment property) and interest and financing costs paid, net of interest income (excluding non-cash items).  FCF is used to assess funds available for debt reduction or future investments within Toronto Pearson.

About the Greater Toronto Airports Authority

The GTAA is the operator of Toronto Pearson International Airport.

SOURCE Greater Toronto Airports Authority

For further information: GTAA Media Office (416) 776-3709; Twitter: @TorontoPearson