Despite ongoing challenges, the strategic, financial and operational responses we put into place at the start of the pandemic continue to provide a sound and reliable framework within which to sustain our business and to begin looking towards a post-COVID-19 future.

Ms. Nompumelelo Mpofu Chief Executive Officer

The 2022/23 financial year presented a complex array of challenges both in the macroeconomic environment and within our business. While the COVID-19 pandemic restrictions were eased considerably in December 2022, it was only on 22 June 2022 that government lifted the pandemic-related State of Disaster, which allowed us to fully embark on the journey to recovery in earnest. It was from this date that travellers entering South Africa were no longer required to produce either negative PCR tests or vaccination certificates, which provided a much-needed stimulation of demand for international travel. These positive developments were, however, offset by the impact of the war in Ukraine, which began in February 2022 and continues unabated. This has affected international food and fuel supply chains significantly, triggering a cost-of-living crisis across major global regions and, specifically in relation to aviation, resulted in precipitous increases in jet fuel prices. In turn, this led to increases in air fares across all segments throughout the reporting period. In our Country, related increases in the cost-of-living, inflation and interest rates had the effect of reducing household disposal income, which had a direct impact on our still-fragile domestic air travel recovery. Additional factors, such as the demise of Comair and its subsidiary Kulula, the continued uncertainties resulting from the halted operations and the potential sale of Mango Airlines, were an added blow.

The protracted period of severe loadshedding that started in September 2022 brought with it further challenges, not just on a practical level but also because it deeply affected investor, business, and consumer confidence. Globally, however, the recovery in air traffic continued to be firm, which supported our own recovery. By the end of March 2023, industry-wide revenue passenger-kilometres “RPKs” (a measure of air passenger traffic) increased by 52.4% year-on-year (YoY) and reached 88.0% of March 2019 levels.

The strategic, financial, and operational responses ACSA put in place at the start of the pandemic continued to provide a sound and reliable framework within which to sustain the business and to begin looking towards a post-COVID-19 future. By year-end, we had managed to establish a solid recovery position, with the total air passenger traffic through our network having increased by 50% over the previous period, which saw the network recover to 76% of pre-COVID-19 passenger throughput.

Our primary consideration at this point therefore remains to recover our pre-pandemic position and to rapidly diversify our revenue streams to mitigate against the risks that continue to exist in aviation.

In this period, we started to plan for the implementation of our Growth Strategy, especially, to resume planning on some of the large capital infrastructure development projects that have been on-hold since the advent of the COVID-19 pandemic. Within this context, our priority remains the safety and security of our staff, passengers, and other airport users. We continue to adhere to the Department of Health and World Health Organisation guidelines to minimise the spread of new variants of the coronavirus and to apply all public and occupational health regulations.

We are also actively assessing, with the aim to mitigate the impact that cost-cutting measures have had on our staff over the past three periods and are beginning to normalise our human resources capacity again, albeit within the existing financial limitations. The early retirement and voluntary separation packages offered between 2020 and 2022, had unintended consequences of loss of key skills, capacity, and institutional knowledge, which we are addressing as a priority. In addition, we are beginning to reintroduce some of the employee benefits, we were unable to offer during the pandemic as part of employee value proposition.

I would like to extend my sincere thanks to our staff for their input, engagement, resilience during the process of implementing the early retirement and voluntary separation packages, which was difficult for everyone involved. Our remaining staff have had to offset the loss of capacity this caused within the organisation, and they have done so admirably. I am humbled by their commitment and grateful for everything they have done to keep ACSA afloat throughout this difficult time.

While the outlook for the next two periods remains uncertain, we have much to celebrate in having achieved the relative recovery position – and we look forward to the future that we have envisioned.

Our recovery trajectory

Although our recovery trajectory has been inconsistent, the notable increase in traffic through our network during the reporting period gives cause for optimism. While capacity constraints and related air fare increases resulted in flat recovery in the domestic segment, the situation is now normalising as incumbent airlines such as Fly Safair, Airlink, Lift, Cemair and South African Airways continue to increase supply to offset the deficit left by the closure of Airlines including Comair, Kulula and Mango.

Further, in all three of our market segments – domestic, regional, and international – new routes and route expansions by both local and foreign airlines continue to support the recovery of passenger traffic. This is evident from the fact that, in FY2022/23, the overall growth of 33% in capacity led to a 50% increase in passenger traffic.

Globally, air traffic – and passenger traffic in particular – continues to improve, driven by an adaptable and resilient airline industry. In addition, while the Asia-Pacific region remained closed for much of the period due to China’s zero-COVID-19 policy, the country’s easing of this policy in December 2022 has accelerated recovery in traffic from that region, which is a key growth market for South Africa. This is especially relevant as ACSA’s airports account for 95% of the country’s total airlift capacity and 99,9% of all international airlift capacity.

During FY2022/23, the recovery of international passenger traffic through O.R. Tambo International continued to lag other competing hubs in Africa, largely due to the fact that a significant portion of the airport’s capacity – including the direct links to Hong Kong and Brazil – is yet to be restored.

As at year-end, a large proportion of the international route network was also operating below pre-pandemic levels, which included traffic to and from the United Arab Emirates, Germany, the United Kingdom, the United States and China. The progressive resumption of services – together with new routes and route expansions – is, however expected to add more than 20 000 seats to O.R. Tambo’s current supply. We therefore anticipate being able to regain much of our pre-pandemic capacity by the end of FY2023/24.

Threats to recovery

Uncertainty relating to the war in Ukraine and the impact on both the global and local economies is, however, a notable threat to recovery, as is sluggish economic growth, irregular power supply and low levels of business confidence at home.

Both the World Bank and the International Monetary Fund have adjusted global growth predictions for 2024 down, with developed economies expected to take a particularly hard knock. National Treasury has also predicted a growth rate of just 0.9% for South Africa in 2023, with this expected to increase to only 1.8% in 2024.

At the beginning of 2022, the global growth rate was adjusted down from 6.1% to 3.6% and finally came in at 3.4% (IMF). Present predictions vary, but growth of around 2.8% is generally expected for 2023. This indicates the extent of the economic challenges we are facing and, while optimistic about our own business prospects, there can be no doubt that we continue to face external headwinds.

Our response

With this in mind, we will continue to operate within the framework of the Recover and Sustain Strategy we put into place in 2020 while simultaneously beginning to plan for the development envisaged in our Growth Strategy. In the short-term, we will continue to focus on our core capabilities and on supporting a recovery in passenger traffic. We will also be focusing on identifying and maximising opportunities in the cargo segment of our aeronautical business.

In line with our strategic pillar of developing airports, we will also continue to focus on the planning necessary to make the airport environment more attractive and engaging for both passengers and the communities living around our facilities, naturally within budget constraints. This planning focused on our Aerotropolis Strategy which is to ensure related developments on our land at the three largest airports, which will vastly improve both their passenger and cargo handling capabilities. We also intend to develop six airport cities at the smaller local airports also aimed at redefining the role and function of airports as economic hubs in the cities and towns they serve.

To ensure that we are able to deliver on our objectives over all timeframes, we will continue to implement the Revised Governance Framework and Operating Model, Capability Model and Organisational Structure we developed in FY2021/22. These allow for the regional integration of our airports at operational level to rationalise costs, maximise opportunities for revenue generation and secure sustainability of our airport network.

While large, uncontracted infrastructure development projects will remain on hold during FY2023/24, we will resume the planning phase wherever possible and financially feasible. Planning for growth is essential in order to secure the longterm sustainability for our business and to fulfil our broader objective, which is to facilitate economic prosperity, social equity, and environmental integrity.

Financial performance

As our results show, revenue increased by 55% to R6 billion (FY2021/22: R3.9 billion) during the reporting period, largely due to the increase in air traffic movement, the recovery in passenger numbers and the implementation of the approved 3.1% tariff increase for the year. This nevertheless remains well below the revenue of R7 billion reported in FY2019/20, prior to the onset of the COVID-19 pandemic. Earnings did, however, improve for the second year in a row and we have reported an EBITDA of R2.0 billion (FY2021/22: R342 million).

Aeronautical revenue, which is derived from regulated charges or tariffs related to aircraft landing and passenger service charges, improved by 64% to R3 billion (FY2021/22: R1.8 billion), while non-aeronautical revenue, which is derived from commercial activities at our airports, increased by 46% to R3.1 billion (FY2021/22: R2.1 billion). As in the previous period, there were some cost savings due to curtailed operations.

An unexpected COVID-19 related negative impact on our financial performance was with respect to value of our investment properties decrease to R7.7 billion (FY2021/22: R7.9 billion) due to fair value loss. This reflects harder trading conditions, slow recovery of the commercial property market, increasing capitalisation rates and sub-optimal leasing regime. Alternative models in our commercial property business are now being pursued to match current favourable market conditions.

With respect to our audit outcomes, we acknowledge the improvement required in expenditure management particularly with respect to procurement and contract management. Our interventions in procurement include the segregation of functions to eliminate conflict of interest and the establishment of an integrated contract management system also utilizing our existing IT systems as recommended by the Auditor General for speedy implementation. Our aim is to eliminate all material findings in financial management and continue to reduce irregular expenditure.

Economic regulation

With respect to Economic regulation, we will continue to actively engage with the Regulating Committee established in terms of the Airports Act (No. 44 of 1993) to ensure that the regulatory model supports fair tariffs for airport services. The regulatory permission for FY2018/19 to FY2022/23 expired on 31st March 2023 with tariffs adjustment of 3.1% from 3.3% prior year, thus an application for interim review resulted in a 4.4% CPI adjustment on tariff effective prior to new permission. We have submitted application for the new permission in November 2022 and expect new tariffs to be approved at most by October 2023 to be effective from 1 April 2024.

Run airports

Regarding our core business of running airports, although improvements in passenger numbers were irregular during the reporting period, year-on-year recovery was positive. This was not, however, consistent across the network.

Our three main airports continue to account for 85% of all air passenger traffic in South Africa, with O.R. Tambo International accounting for 49% of all departing traffic. Regional inland airports, such as Upington, Kimberley and Bram Fischer (Bloemfontein) continue to record good recovery rates, largely due a slow normalisation in business travel and the core ‘visiting friends and relatives’ (VFR) segment. Coastal airports, which are more reliant on leisure traffic, have not fared as well due to a significant reduction in leisure travel during the reporting period, which resulted from increases in ticket prices as well as the impact high inflation and high interest rates had on discretionary spending.

Cape Town International was the major beneficiary in terms of international passengers, with throughput exceeding preCOVID-19 levels for the first time in February and March 2023. This was partly due to the normalisation in the number of visitors from Europe during our summer months and partly due to route expansions and new capacity favouring Cape Town. The city is also actively marketed as an all-year-round tourist destination and as a prime destination for the MICE (meetings, incentives, conferences, and exhibitions) segment.

Our Journey in Environmental, Social, and Governance (ESG) Initiatives

Throughout the financial year under review, we have achieved a significant milestone on our path towards a more sustainable and responsible future. As we navigate the ever-evolving landscape of aviation and air travel, it has become increasingly evident that our commitment to sustainability is not only crucial for our group’s success but also for the well-being of our planet and society. It is with immense pride that I confirm our collective dedication to sustainability, marked by the adoption of a robust Environmental, Social, and Governance (ESG) framework.

It is imperative to underscore the foundational concept of “double materiality” that forms the basis of our sustainability approach. We recognise that our operational activities extend beyond their financial implications, exerting influence on the broader global landscape. This dual perspective on materiality emphasises the interconnectedness between financial performance and the far-reaching societal and environmental impacts of our decisions.

Considering this profound interconnectedness, we have embarked on an extensive journey to seamlessly weave sustainability into every facet of our organisation. In the upcoming reporting periods, our sustainability programme will no longer remain a peripheral endeavour, it will ascend to a pivotal role within our overall strategy. By integrating sustainability into our organisational DNA, we signal our unwavering determination to generate a positive societal and environmental impact while ensuring our enduring success.

Despite being in the initial stages of our ESG roadmap, we persistently engage in meticulous analysis to steer our strategic planning. This includes benchmarking against global airports and engaging in consultations with key stakeholders. These efforts will culminate in the establishment of a comprehensive ESG reporting system that captures the intricate dimensions of our sustainability endeavours.

As we set forth on this transformative path, let us be guided by our shared commitment to a greener, more equitable future. Together, we shall harness the power of sustainability to shape not only our organisation’s trajectory but also the trajectory of our planet and society for generations to come.


The easing of global travel restrictions since late December 2022 is supporting a recovery in air traffic worldwide, although markets and travel patterns have changed over the past three years, and this will have a lasting effect on passenger travel in particular. We anticipate that domestic recovery will continue to be flat throughout the 2023/24 financial year as pressure on the price of leisure travel continues.

We do, however, foresee an uptick in regional travel as airlines servicing the SADC region increase their capacity. Markets such as Botswana, Mozambique and Madagascar are, for example, experiencing growth in both demand and capacity. This will reinforce O.R. Tambo International’s status as a hub for the southern African region to the extent that the airport is expected to recover 100% of its pre-COVID-19 international passenger traffic in August 2023.

This nevertheless needs to be seen in light of deteriorating global economic conditions, which pose a notable downside risk to recovery prospects.

Within this context, we will continue to provide a safe, secure, efficient, and convenient environment for passengers and all other stakeholders as well as to engage with businesses and government departments in the aviation and related sectors to support recovery.

We will also resume our process of planning for growth in the future and will focus on our strategic intent of diversifying our revenue streams and upweighting our activities in the commercial and cargo segments. This process is already underway within the confines of existing infrastructure and budgets. In the medium- and long-term, we will focus on expanding our infrastructure and capacity in order to support our growth and revenue diversification objectives.


In concluding, I would again like to extend my sincere gratitude to our staff for their ongoing commitment shown to our business throughout the challenges of the past three periods. A special thanks are due to the staff members who were willing to take early retirement or enter into voluntary separation agreements, which enabled us to secure the Company’s long-term sustainability.

I further commend the executive and management teams for their agile approach to managing a very complex business in such uncertain circumstances. To all our airport stakeholders, thank you for your contribution to keeping our airports safe and running efficiently under exceptional circumstances. I would also like to extend my appreciation to our Board for its unwavering dedication and guidance during yet another challenging year.

Finally, to our shareholders, investors, and lenders, thank you for your ongoing support and confidence in our business. In line with our strategy, we remain committed to being one of the world’s leading airports operators.

Ms Nompumelelo Mpofu
Chief Executive Officer