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Outlook report

Economic and industry-specific conditions

The following explanations concerning the outlook for 2020 take account of the impact of the coronavirus only to the extent that the relevant information or predictions were published at the time the report was drawn up. The effects on the international and German economy are severe, but cannot be predicted accurately as yet based on the current state of knowledge.

In February 2020, the International Monetary Fund (IMF) was still expecting that the global economy would record healthy growth of more than 3 percent with due regard for the coronavirus.20 However, this optimistic forecast has now been overtaken. To slow down the spread of the coronavirus, many countries around the world began in March 2020 to impose severe restrictions on the freedom of movement and action. A global recession now seems inevitable. Many countries currently expect their respective GDP growth to be at least four or five percentage points lower than originally forecast.21

Even when it comes to the leading industrial nations, all economic growth forecasts have been significantly adjusted downward as a result of the coronavirus crisis. According to the International Monetary Fund (IMF), China (+1.2 percent) and India (+1.9 percent) are now the only mayor economies where a recession still seems to be avoidable. In contrast, the USA expects a decline of -5.9 percent. Canada and Japan are reporting similar forecasts. Economic growth in Great Britain has also been adjusted downward to -6.5 percent. These effects related to the coronavirus eclipse all other developments, such as Great Britain’s withdrawal negotiations from the European Union (Brexit).21

The general economic situation in the eurozone in 2020 will suffer the worst recession since the Great Depression of 1929. The IMF is anticipating an average economic contraction in the eurozone of -7.5 percent. Significant declines are expected for the four most important European economies; -7.0 percent (Federal Republic of Germany), -7.2 percent (France), -9.1 percent (Italy), and -8.0 percent (Spain).21

The ifo Institute for Economic Research has calculated a number of different scenarios for the Federal Republic of Germany. According to one estimate, extending the shutdown by just one week translates to a drop in GDP growth of 0.7 to 1.6 percentage points. Whether and how strong the recovery will be in the following year 2021 is still unclear. However, it seems probable that it will take more than one year to achieve the previous GDP level again.22

In 2019, the price of oil fluctuated between USD 53 and 76 per barrel.23 In the first months of 2020, the price collapsed by around 70 percent due to the drop in demand and is now at an historically low level of less than USD 30 per barrel.24

The demographic and economic general conditions in Bavaria and especially in the airport catchment area mean that further strong growth in transportation demand can be expected at Munich in the medium to long term despite short-term slumps. According to the results of the regionalized population projection by the Bavarian State Office for Statistics, the number of people living in Bavaria, especially around Munich, will grow in the period up to 2037, and this growth is characterized as strong to very strong. The population of Upper Bavaria will increase by 9 percent, in the district of Munich by 12.1 percent, and in the City of Munich by 11.6 percent.25 In Prognos Zukunftsatlas 2019, the City of Munich and the district of Munich followed by the region of Ingolstadt head the list of regions with the best future prospects.26 Driven by growing prosperity and an increasing population, the trend in the volume from Munich Airport’s core catchment area was positive in recent years in particular. This trend will continue in future. These statements are supported by the «Teilhabeatlas» study on differences in living conditions conducted by the Berlin Institute and Wüstenrot Stiftung. This study shows Munich as the top location and one of the richest cities in Germany.27

The global aviation market is expected to experience the worst crisis to ever hit the sector owing to the impact of the many travel restrictions. Following initial optimism, all industry and advocacy groups have revised their forecasts downward on a weekly basis. Meanwhile, significant double-digit losses in global aviation seem inevitable. In April 2020, for example, the International Air Transport Association (IATA) lowered the average annual growth rate for 2020 for sold passenger kilometers globally from an original figure of 4.1 percent to -48.0 percent. A precise and conclusive assessment is not possible since the actual growth remains unpredictable: how will new infections behave, which countries will lift travel restrictions when, which airlines will survive the extensive grounding, and how severely will the inevitable recession impact travel behavior.28

Forecast course of business

The aviation industry is affected more severely and more directly than other sectors by the consequences of the global spread of the coronavirus. The coronavirus has led globally to a number of travel restrictions in companies, to the cancellation of major events, and to considerable uncertainty among consumers. Many countries, such as the USA, have imposed entry restrictions on people arriving from Germany. The impact on demand for air travel and services at Munich Airport is therefore considerable.

Munich Airport expects that the consequences of the crisis will strongly influence the Group’s economic performance in 2020 in all business units. Just how long the burden will be felt cannot be estimated at present, since this depends largely on the specific course of the crisis and the supply response and consumer reaction to the spread of the virus. In addition, the impact the crisis will have in subsequent years also cannot be predicted at present.

The Executive Board is expecting traffic levels to fall by more than 90 percent in the months of April and May 2020. Successive recovery to around half the level of the previous year is then expected.

Alongside the significantly negative impact of the coronavirus crisis on traffic growth, price reductions in airport charges are estimated for 2020. The reduction in charges is due to the advance final settlement of the master agreement on charges, which has been in force for several years.

All business units are affected by the sharp decreases. Dramatic falls in air traffic charges will result in the Aviation business unit owing to the collapse in passenger volume. The effects are also severe in the Commercial Activities business unit, primarily because of the officially decreed shutdown of the retail units. The negative impact will be less onerous in the Real Estate business unit compared with other business units owing to the typically long-term leases.

Against the backdrop of the traffic situation and consequently the substantial decline in revenue, the Group expects that earnings before taxes (EBT) will shrink considerably in fiscal year 2020 compared with the previous year even following implementation of extensive countermeasures.

Massive efforts are being taken by the Executive Board to ensure liquidity. This is being done through savings on all costs and investments. For example, deferrable construction projects that are not business-critical or of major strategic relevance are being moved to a future date. On the other hand, a broadly based cost-cutting program is being initiated, which also includes measures in the area of HR, including measures to secure liquidity such as short-time work.

The Group is in a position to continue to make investments that are essential and strategically important for operations. Compared with the previous year, the total investment volume will remain at the previous year’s level despite the deferral of several construction projects, but will still be significantly below the volume envisaged in the original planning. Munich Airport is in negotiations with its principal banks to address an imminent liquidity gap toward year-end. Talks are set to conclude in the coming weeks concerning the current offers. The traffic, profit, and liquidity forecasts will be updated continually over the course of 2020 and, depending on the further development of the crisis, a decision will be made as to when and to what extent an increase in the existing credit lines will be initiated and, if necessary, new funds raised. This will ensure that the Group can maintain adequate liquidity levels at all times.

The cash burn outlined assumes that the countermeasures in terms of costs and investments, as well as in HR, are implemented, and also that the traffic scenario will start to recover again slowly from June 2020 and, taken for the year as a whole, will equate to approximately half that of the previous year. If these assumptions do not come to pass in the manner outlined, this may lead to an increased liquidity demand and consequently to earlier consumption of the existing liquidity reserves. This possibly higher liquidity demand can be covered by FMG on the banking and capital market.

Forecast of the most important financial and non-financial key performance indicators:

Forecast financial and non-financial key performance indicators





























EBT (in T€)







CO2 (reductions in tonnes)









Passenger experience index total satisfaction









Overall, Munich Airport expects EBT to decrease significantly. The precise extent of the decrease is dependent primarily on the duration of the coronavirus crisis and is difficult to estimate at present.

In relation to carbon reductions, a slight decline in the target value for 2020 is expected compared with the reductions achieved in 2019. The PCA systems (preconditioned air systems) installed at Munich Airport were gradually phased into normal operation. Their usage rate will remain at a high level. Additional savings from efficiency measures of more than 2,300 tonnes of CO2 are being sought in 2020. The planned measures should primarily reduce the energy requirement for lighting and air -conditioning technology.

Munich Airport will further intensify the continuous improvement measures in the area of passenger satisfaction in 2020. Thus, for example, there are plans to enhance passenger support locally in Terminal 1 by deploying terminal managers. In addition, passenger comfort is to be further improved in the C-West hall and additional border inspection posts are to be constructed in Module B to optimize departures for passengers. A modern security check is also being developed on Level 05 in Module D to offer enhanced comfort for passengers. Optimizations are planned in Terminal 2 for passengers traveling with small children. This is being done, for example, through an extensive trial run to provide free buggies or also through improvements to the Wi-Fi availability in the terminal, something that is very important for passengers. Munich Airport is aspiring to achieve further improvements in relation to baggage arrival times in 2020 to make up for the fall in passenger satisfaction in this area in 2019. In addition, the PAKS (alternative screening lane) that was successfully implemented in 2019 is to be further optimized and extended by a dual lane in collaboration with the government of Upper Bavaria.

20 International Monetary Fund, World Economic Outlook, January 2020; Manager Magazin, IMF senkt Wachstumsprognose für China (IMF lowers growth forecast for China), February 23, 2020

21 International Monetary Fund, April 2020: The Great Lockdown: Worst Economic Downturn Since the Great Depression, April 14, 2020

22 ifo Institute for Economic Research, April 2020: ifo Schnelldienst monthly journal, April 15, 2020

23 onvista website, January 2020

24 onvista website, April 2020, as at April 15, 2020

25 Bavarian State Office for Statistics and Data Management (Bayerisches Landesamt für Statistik), regionalized population projection for Bavaria up to 2037, December 2018

26 Prognos Zukunftsatlas 2019, July 2019

27 Berlin Institute/Wüstenrot Stiftung, Teilhabeatlas Germany August 2019

28 IATA, Economics COVID-19, April 14, 2020

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