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Airports of Thailand PCL (SET:AOT), 70% stake owned by the Ministry of Finance as of December 17, 2015, operates two principal business segments, which are the airport business and hotel business. The company manages and develops Suvarnabhumi, Don Mueang, Chiang Mai, Hat Yai, Phuket and Mae Fah Luang Chiang Rai airports. Their non-aeronautical activities include office and state property rentals, services and concessions. AOT is also involved in the development of hotels near Suvarnabhumi airport. The company’s subsidiaries include Suvarnabhumi Airport Hotel Company Limited.
Total air traffic movement, including arrivals and departures, which peaked at 67,690 in January 2016, continued to decline to 62,334 in September, but was up 14% year-on-year from 54,684 in June 2015. The total passenger movement, which also peaked in January 2016 at 10.92 million, dropped to 8.89 million in September, up 15.2% year-on-year from 7.72 million in September 2015. Overall, long-term trends for both air traffic and passenger movement are still on the upside. Note that January is a typical peak month for AOT, followed by December.
Low-cost carrier (LCC) traffic movement was up 15.9% year-on-year to 28,863 in September 2016, compared to 24,852 during the same period last year. LCC passenger movement jumped 21.6% year-on-year to 4.17 million in September 2016, compared to 3.43 million in September 2015.
AOT said on August 11 that its revenues for the third-quarter 2016, ending June 30, increased 15.81% year-on-year to 12.57 billion baht, beating the 12.56 billion baht consensus estimate of 4 analysts, according to the Financial Times. Aeronautical revenues were 7.13 billion baht, up 11.43% year-on-year. Non-aeronautical revenues, about 43% of the total revenues, which are mostly concessions, increased 22.08% year-on-year to 5.44 billion baht. The company posted its third-quarter 2016 earnings increase of 24.56% year-on-year, or 3.55 baht per share, beating the 3.34 baht per share consensus estimate of 3 analysts.
For 2015, AOT reported a dividend of 6.54 baht a share, which represented a 92.35% increase from 2014. The 20 analysts covering the company expect dividends of 5.94 baht a share for the upcoming fiscal year, representing a year-over-year decrease of 9.19%. The next earnings announcement is expected on November 25, 2016. The consensus estimates are EPS of 2.9 baht on revenues of 12.96 billion baht for the fourth-quarter 2016.
From our technical viewpoint, a bearish descending triangle chart pattern has emerged. The stock should bounce off the 372 baht level, or else it could head downwards to test the 352 baht level. The bad news is that AOT shares were recently taken down by the algo traders to the 300 baht level. Hopefully, nobody will come up with an idea of taking the stock down to test that level again, but you never know!
According to the Financial Times, the consensus amongst 24 polled investment analysts covering AOT gave the company an Outperform rating, with the median 12-month price target of 420 baht per share, as of October 28.
Disclosure: No position and no recommendation. |
