NAD 2016 Annual Report
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Flight Plan: Charting the Future Annual Report 2016. Nassau Airport Development Company CHARTINGFlight Plan: THE FUTURE 2 Contents Message from The Chariman 4 Message from The President 5 About Us NAD & Vantage 6 Board of Directors 8 Executive Management Team 9 Airlines & Destinations 10 Results Summary 11 Strategic Plan 2015-2019 12 Investing In Our People 14 Safe, Secure & Efficient Operations 16 Building Capacity 18 Extraordinary Customer Experience 20 Fiscal Responsibility 22 Stakeholder Relationships 24 Building Communities 26 Financials 28 3 FROMMessage THE CHAIRMAN This past year reminded us that external factors experience and improving safety. LPIA received can strongly impact our business. The delayed an Overall ASQ Customer Satisfaction Score of opening of Baha Mar, the weakened Canadian 4.42 out of a possible five points, placing it in the dollar, and the struggling Brazilian economy all top three airports in the Latin American and resulted in a softening of the Bahamian tourism Caribbean region. LPIA also became the first industry. With the vast majority of our passengers airport in The Commonwealth of The Bahamas being leisure travellers, those issues directly to receive its Aerodrome Operator Certificate from affect Lynden Pindling International Airport. the Bahamas Civil Aviation Authority. Achieving certification demonstrates our commitment to That said we have a clear vision of where LPIA is operational excellence and international safety and where it is headed—on the path to becoming standards, further elevating LPIA on the global a world-class airport providing an extraordinary stage. customer experience. There is no doubt that the future holds Last year NAD launched a five-year strategic challenges for us. With the opening of plan to get there. The team has spent the past the Cuban market to US travellers, 12 months focused on six key priorities: The Bahamas will face more competition than ever before. But • Investing in our people with a strong team in place, and a • Providing a safe, secure, and efficient detailed strategy to act as our flight operation plan, we are prepared to navigate • Building capacity to meet growth potential all that lies ahead. • Delivering an extraordinary customer experience On behalf of the Board of Directors, • Maintaining a fiscally responsible and I would like to thank the NAD team profitable operation and the airport community for their • Enhancing stakeholder relationships. dedication to LPIA and its success. I am pleased to report that the plan is already generating results. Despite the challenging conditions, the team maintained LPIA’s competitive position. Our passenger numbers remained strong, Anthony McKinney, matching 2015’s 3.3 million, the highest since Chairman 2008. Revenues were up by $1.4 million reaching a record high of $75.9 million. And operating expenses were down by $449,000, a testament to the entire team’s commitment to improving efficiency and productivity across the business. It’s important to note that these results were achieved while delivering a strong customer 4 FROM THE PRESIDENTMessage In many respects, 2016 marked a time of change Border Protection, the Transportation Security for NAD. After the successful redevelopment of Administration, and many of our airlines, we the airport, we embarked on a five-year strategic launched electronic boarding pass scanners. plan to distinguish LPIA as one of the world’s Customers without checked luggage can now use leading airports. The plan and its six key objectives a digital boarding pass on their mobile phone to is our chart for the future, focusing our efforts and move more directly to their gate. providing a means for us to measure our progress. To increase capacity for US flights, we converted The past 12 months have brought challenges, two international gates into swing gates which but looking back I can’t help but feel immense can now be used for US operations during times pride at NAD’s team and the broader airport of increased demand. We also added another jet community for all that we have achieved bridge to accommodate aircraft of any size. together. Despite these accomplishments, we cannot lose A highlight was receiving our sight of future challenges. The Bahamas has long Aerodrome Operator Certificate from benefitted from being the closest warm weather the Bahamas Civil Aviation Authority destination to the US Eastern Seaboard. With (BCAA). This is a distinction that Cuba coming online, our competitive landscape few airports in the Central is now changing. As an industry we must work American and Caribbean region together to give our travellers compelling reasons have achieved and was made to visit The Bahamas and deliver an exceptional possible through a renewed spirit experience while they are here. of collaboration and cooperation between NAD and the BCAA. Over the past year I have seen LPIA come together to do just that. Through collaboration, smart We have also been working with the thinking, and hard work, we’re delivering a truly Nassau Paradise Island Promotion memorable Bahamian experience for our guests. Board and The Bahamas Ministry of Tourism on air service development And for that I want to thank NAD employees, our initiatives. Through our joint efforts, partners, and the entire airport community. 2017 Silver Airways added service from four will mark the 10th anniversary of our operations US cities; British Airways and Jet Blue at LPIA and I look forward to the next leg of our added capacity; and Southwest Airlines journey together. added a new route. To improve the passenger experience and reduce confusion, we worked with our partners at the Bahamas Customs Department and the Nassau Paradise Vernice Walkine, Island Promotion Board to install a President and CEO passenger notification system in the customs and baggage claim area. In partnership with US Customs ad 5 ABOUT US As the primary international gateway to The NAD is responsible for the majority of LPIA’s Bahamas, Lynden Pindling International infrastructure including parking lots, terminals, Airport (LPIA) is the fourth busiest airport in runways and taxiways, and all revenue- the Caribbean. Named for Sir Lynden Pindling, generating and commercial development the first Prime Minister of The Commonwealth projects. As a private company, NAD receives of The Bahamas, the airport sits just west of the no government guarantees or grants and is city of Nassau and a short drive from some of a self-sustaining commercial entity based the finest resorts and hotels in the world. on international best practices. Services include scheduled and charter flights Vantage Airport Group is an industry- to the United States, Canada, Europe, Latin leading investor, developer, and operator America, and the Caribbean. In FY2016, LPIA of airports around the world. The served 3.3 million passengers and safely handled company brings the expertise and more than 83,000 aircraft takeoffs and landings. airport management techniques honed at multi-award-winning Nassau Airport Development Company Vancouver International Airport (YVR) (NAD) is a Bahamian company owned by the to LPIA. Vantage has a current government of The Bahamas. We are operated portfolio of nine airports on two by Vantage Airport Group, a Canadian company, continents. under a 10-year agreement. In April 2007 NAD signed a 30-year lease with the government to manage and operate LPIA on a commercial basis while providing Bahamians with opportunities for business and investment. 6 7 DIRECTORS NAD is governed by a Board with nine Directors. Anthony McKinney, Manita Wisdom, Deepak Bhatnagar Chairman Deputy Chairman Dr. Gregory Carey George Casey, Michael Foster Vantage Airport Group Douglas Hanna Annischka Holmes-Moncur Rev. Lloyd Smith 8 EXECUTIVE MANAGEMENT NAD is led by an Executive Management team with expertise in airport operations, maintenance, finance, business, and marketing. Vernice Walkine, Deborah Coleby, Jan Knowles, President & Chief Executive Officer Vice-President of Operations Vice-President of Marketing & Commercial Development Kevin McDonald, Paula Rigby, Vice-President of Maintenance Vice-President of Finance & Engineering & Chief Financial Officer 9 AIRLINES & DESTINATIONS With 23 airlines serving 55 destinations—21 US, 11 international, and 23 domestic—LPIA offers more travel options than any other airport in the Caribbean. We serve three market segments: domestic, US and international, making us a key hub for passengers coming to The Bahamas or connecting to destinations in the US or around the globe. Air Carriers AIR CANADA FLAMINGO AIR SOUTHERN AIR AMERICAN AIRLINES IBC AIRWAYS SOUTHWEST AIRLINES BAHAMASAIR INTERCARIBBEAN AIRWAYS SUN COUNTRY* BRITISH AIRWAYS JET BLUE AIRWAYS SUNWING AIRLINES CARIBBEAN AIRLINES LEAIR CHARTER UNITED AIRLINES COPA AIRLINES PINEAPPLE AIR WESTERN AIR CUBANA AIRLINES SILVER AIRWAYS WESTJET DELTA AIRLINES SKY BAHAMAS Routes ATLANTA FORT MYERS (NEW) ORLANDO BAHAMAS FAMILY ISLANDS HAVANA PANAMA CITY BALTIMORE HOUSTON PHILADELPHIA BOSTON JACKSONVILLE (NEW) PROVIDENCIALES CALGARY* KINGSTON SANTA CLARA (NEW) CAP-HAITIEN LONDON, LHR TAMPA (NEW) CAYMAN ISLANDS MIAMI TORONTO CHARLOTTE MINNEAPOLIS* WASHINGTON DC, DCA CHICAGO MONTREAL* WEST PALM BEACH DALLAS NEW YORK, EWR DETROIT* NEW YORK, JFK FORT LAUDERDALE NEW YORK, LGA * Denotes seasonal destination. 10 RESULTS SUMMARY 2016 At A Glance PASSENGER MOVEMENTS 3.3m • Up 1.1% REVENUE $75.9m • Up 1% OPERATING INCOME $51m • Up 4.2% AIRCRAFT MOVEMENTS 83,158 • AIRLINES 22 • DESTINATIONS 55 OPERATING RETAINED LONG TERM PASSENGERS AIRCRAFT REVENUE EXPENSES EARNINGS DEBT (MILLIONS) MOVEMENTS (MILLIONS) (MILLIONS) (MILLIONS) (MILLIONS) 2016 3.3 83,158 $75.9 $25.0 ($24.7) $523.6 2015 3.3 85,006 $74.6 $25.5 ($11.2) $506.3 2014 3.2 85,900 $71.6 $24.6 $3.9 $513.3 2013 3.2 85,700 $64.3 $23.0 $20.3 $497.0 2012 3.2 82,100 $55.9 $21.2 $24.4 $445.4 11 12 STRATEGIC PLAN 2015-2019 Charting Our Path To Becoming One Of The World’s Best In 2015, NAD launched a five-year strategic plan with an overarching objective to become one of the world’s leading airports.