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2018Fort Mcmurray Airport Authority Annual Report

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2018Fort Mcmurray Airport Authority Annual Report Building Resilience Fort McMurray Airport Authority 2018 Annual Report Who We Are The Fort McMurray Airport Authority (FMAA) is an independent non-share capital corporation that owns and operates the Fort McMurray International Airport (YMM). FMAA operates like a local business, facilitating critical transportation services, creating local jobs, procuring local goods and services and offering commercial land leasing opportunities. All surplus revenue generated from commercial activities are reinvested back into airport operations and infrastructure to ensure compliance with safety, security and environmental regulations. Vision We are Canada’s Premier Regional Airport. Mission We are responsible stewards of our airport, achieving superior performance in the conduct of safe, secure, effective and efficient operations. Our airport businesses contribute significantly to the economy of the region, Alberta and Canada. Corporate Values • Excellence in safety, security and environmental performance • Commercially focused, fiscally responsible and sustainable • Exemplary customer service • Progressive leadership • Extraordinary teamwork 2 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 3 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 Who We Are Table of Contents Message from the Board Chair and President & CEO 4 Business 7 Passengers 11 Operations 15 Community 19 Board Governance & Accountability 23 Management Discussion & Analysis 26 Financial Statements 36 2 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 3 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 4 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 5 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 Introduction Welcome to the Fort McMurray Airport Authority (FMAA) Annual Report, which covers our performance on business and operational parameters as well as interface with the community. The report begins with a joint message from the FMAA Board Chair, Mike Chwelos and President & CEO, RJ Steenstra as they share significant events for the airport during the year. 4 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 5 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 INTRODUCTION Message from Michael Chwelos and RJ Steenstra CHAIR, BOARD OF DIRECTORS AND PRESIDENT & CEO 2018 was a year of transformation at the Fort McMurray Airport We Are Flexible Authority (FMAA). We continued to move our organization forward We learned from the 2016 wildfires, that people and organizations and harnessed new opportunities as we stayed on course, adjusting to must be flexible in order to adapt to the changing world around changing economic conditions. them. Since 2016, the Airport Authority has become more agile not only when faced with immediate dangers such as the wildfires, but Our overarching theme of “building resilience” anchored our business also in our ability to anticipate and adjust to growing risks, threats outlook for the year. For the Airport Authority, resilience has come to and new opportunities. mean very specific things. Our journey through the economic downturn has allowed us to fine tune our business and redefine for ourselves The Airport Authority, like many local businesses, continued to what it means to be a resilient organization. feel the impacts of a lower oil price environment. With supply far exceeding pipeline capacity, the region continued to face pipeline 4 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 INTRODUCTION transportation bottlenecks, hindering oil sands capital investment Arrivals, where they grew vegetables and flowers used for our opportunities and the demand for local air travel. planters around the facility. The YMM gardens were a big hit, fostering civic pride in our airport. Last year we made significant changes to prepare our organization to endure and even thrive in an environment with fluctuating passenger We Are a Good Neighbour volumes. We found operational efficiencies and right-sized our Strong relationships with our stakeholders are fundamental to our organization to offset declining passenger demand. success. In 2018, we gathered stakeholder input from our airlines, tenants, passengers, municipality, local business community, We began 2018 with the goal of becoming a top performing airport for suppliers and the social profit sector. customer experience. We are pleased to say we accomplished what we set-out to achieve, becoming the best regional airport in Canada for During this process we encouraged a cycle of learning, while we customer experience. gathered valuable input and suggestions to help us continuously improve our business and our operations. For example, after Our efforts were recognized by Airports Council International - World receiving feedback about temperature levels in Departures, we with a 2018 Airport Service Quality Award. We received top honour for installed new window screens to help keep the terminal cool in Canada and we were joined by one other airport in the United States as the warmer season. This improvement to our terminal increased North America’s best regional airports for customer experience.。。 comfort levels for both passengers and our concession partners and created heating and cooling efficiencies. We Have Many Strengths FMAA’s resilience lies in our ability to leverage our strengths in times of We also met with stakeholders to share information on the uncertainty. In 2018, we saw further declines in commercial and charter Passenger Demand Study we conducted towards the end of aircraft activity, which included one of our airline partners suspending 2017. We found that approximately 164,500 passengers annually their direct Toronto flight due to declining local demand, exacerbated opt-out of using YMM, and instead elect to drive to airports in by continued slowdown in oil sands capital investment. Edmonton or even Calgary to catch their flights. Despite these set-backs, FMAA successfully maintained all other flight Listening and engaging with our stakeholders allowed us to dive destinations from the previous year and we continued to work diligently deeper into understanding the barriers that might be hindering with our airline partners on securing services that meet local needs. residents from flying local. Armed with greater insight, we are committed to working with our airlines to develop fit for purpose We continued to expand our non-aeronautical business portfolio to flight options and work with our community stakeholders to optimize our 685 hectares of land, of which 77 hectares is designated build customer loyalty, understand potential customer needs and for commercial development. In 2018, we completed a Land Use influence transportation choices. Marketability Study to guide future business development. The study reinforced for us that land development opportunities on airport land We Are Ready exist in the interim and long-term. Closing the year, we can look back with certainty that our organization and our people have demonstrated great resilience. We Are Operationally Excellent We have adapted and persisted, taking the right steps needed Last year we not only met, but exceeded service levels in the face to pivot towards increasing our sustainability. Looking ahead of continuous external market pressures. Our focus on operational we will enhance our triple bottom line of economic, social and excellence allowed us to optimize our facility to deliver superior environmental performance. passenger satisfaction. In 2018, we harnessed new technologies to deliver excellence. We upgraded our public Wi-Fi infrastructure with leading technology wireless network equipment. Our internet service is now four times faster than before, making us one of the only airports in North America to offer superior public Wi-Fi connectivity. And we didn’t stop there. We also moved our landscaping and beautification program in-house, deploying the talents of our staff. We moved away from contracting out this service and found tremendous Michael Chwelos RJ Steenstra cost efficiencies, not to mention that we saw a boost in team morale. Chair, Board of Directors President & CEO Our team constructed a community garden located in our courtyard at Fort McMurray Airport Authority Fort McMurray Airport Authority 5 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 BUSINESS Business 6 | FORT MCMURRAY AIRPORT AUTHORITY ANNUAL REPORT 2018 BUSINESS Business WE ARE FLEXIBLE FMAA operates like a local business. We facilitate critical transportation services, create local jobs, procure local goods and services and offer commercial land leasing opportunities. Our business model gives us the flexibility to diversify our revenue streams, which enhances our financial sustainability. We do this by balancing aeronautical sources of revenue such as airline, terminal rent and usage fees, with non-aeronautical sources of revenue such, as advertising, retail and car rental concessions and real estate and land leasing. Revenue Diversification Commercial Land Only a few airports in Canada own the land where they operate and YMM is one of them. We have a unique opportunity to facilitate business ventures on our 77 hectares, by offering the largest supply of readily available commercial and industrial land in the region outside of individual oil and gas sites. Our objective is to work hand-in-hand with our business partners to facilitate the development process from start to finish. Potential commercial land uses include: Car rental facilities Distribution centres Food and beverage Gas station/car wash Hotels/apartments
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