Passenger count, revenues up at Saint John Airport

By Andrew Macdonald
Maritime Business

Passenger count, revenues up at Saint John Airport

Passenger traffic and annual revenues were up in 2023 said Saint John Airport Inc (YSJ) over 2022, but the figures are still down from pre-pandemic year 2019.

YSJ held its annual general meeting Wednesday, backdropped by an announcement air service between Saint John and Halifax Stanfield will return on September 9 for a twice-daily flight between the two Maritime cities.

In 2023, revenues reached $6.4 million, up 42 per cent from 2022, when figures totalled $4.5 million, according to the airport’s audited statements, prepared by chartered accounting firm, Teed Saunders Doyle.

Revenue, however, is down from 2019, before the pandemic, when figures totalled $6.977 million.

The airport in 2023 produced red ink but the figure has been reduced from 2022 losses. Last year, the airport recorded financial losses of $215,430, much better than losses of $1.387 million the year before. Profits in 2019 totalled $223,128.

The airport paid out salaries in 2023 totalling $2.28 million, down from a figure in 2019 of $2.6 million.

The revenue stream consists of aircraft landing and terminal fees, which totalled $1.588 million last year, up from 2022, when the figure stood at $979,932. The 2023 figure is close to the figure in 2019, which tallied $1.6 million.

Vehicle parking at SYJ last year recorded $603,579 in revenue, more than the 2022 figure of $539,889, but still down from the figure in 2019 of $955,516.

Passenger fees saw revenue in this stream reached $2.996 million last year, an increase from the 2022 figure of $2.117 million, but down from 2019, when passenger fees tallied $3.279 million.

“The Saint John Airport (YSJ) saw continued growth in 2023 with passenger numbers reaching 175,000 by year-end, an 18 per cent increase over 2022,” said the airport’s CEO, Alexander ‘Sandy’ Ross. The passenger figure in 2019 had about 280,000.

In an interview, speaking on the financials, Ross said when he took on the job in 2022, the airport “was staring down the barrel of some deficits in terms of our budget, it was uncertain how quickly air travel would come back, and how fast it would come back to Saint John, in particular, because we have four airports at that point getting regular Air Canada traffic, and Air Canada represented the bulk of our revenue, and we did a comprehensive revenue review, and we looked at all the sources of revenue, and we did things like increase the passenger fee from $35 to $42,” he explained.

“We also increased and normalized for private rotations, as well (flights). One of the curiosities of our financials, before last year, about 40 per cent of the rotations out of Saint John are private (jets),” as compared to commercial air traffic, he added. “We have the air fleet for Irving Oil, JDI, Cooke Aquaculture & Ocean Steel. They are all heavy users of their own flights. They do a lot of rotations and the way the pricing structure had been set up, the landing and terminal fees for commercial aircraft were pretty well normal, but the landing fees on a per seat basis were significantly reduced for the private operators, so we normalized that on a per seat basis,” said Ross.

“We got a significant amount of revenues as a function of normalizing that (fee) between private and commercial rotations.”

The airport also studied its rent structure for its major tenants. “We got a full study of what we should be charging, and there were lease negotiations with a couple of tenants and we were able to do much better rents on those tenants than we would have otherwise.”

Besides studying its revenue streams, Ross and his team “also very carefully reviewed and trimmed our costs, and we were able to get the books near to balance this last year, and it looks like a solid profit in 2025.”

The budget for a profit in 2024 is $175,000, added Ross.

“Hopefully, there is no Air Canada strike that takes the wind out of that, and we will be back to profitability in 2024. 2025 is when we should be back to making significant profit again.”

Employment expenses in 2023 are down from 2019, and Ross said some executive management posts have not been filled. “We have a couple of management positions that we have not filled. I am doing double duty – we used to have a director of commercial relations, and… I took that responsibility over, and one admin role has not been brought back after the pandemic.”
Land development

The airport is also looking to further develop its land holdings, as a way to diversify its revenue streams.

“In 2023, we began to seriously work on land development. I look forward to some exciting announcements in this area in 2024. Utilizing this land more effectively will be good for YSJ as the revenue will enable us to grow the terminal and our air service,” said Ross. “Land development is actually pretty critical for us.”

The federal minister of transport, and deputy minister, during the pandemic, visited YSJ and told Ross to find other ways to diversify revenue, over and above airport landings and terminal fees.

“They said find other ways to harden your finances. So what we have a lot of here that hasn’t been used are lands. We have 650 acres of prime commercial property in the heart of Saint John city, that is dying for significant amounts of commercial property,” Ross explained. “We did a study on how to bring that land to market. So we have three different types of land that we will bring onto the market. There is general retail land, where we can put anything from a hotel to a restaurant. We have airside land, there is 100 acres of that. Think of land where you actually get a taxi runway access…. where we can let people have hangars, fixed base operations, maintenance and repair operations. We have that land and we are starting to work that land and bring it onto the market.

“We have 450 acres of land that would be appropriate for light industrial, and it is federal land and the airport plan is already predisposed towards those types of commercial opportunities,” he added.

“So for us, (developing those lands), that (new) revenue can do two major things. One, it can insulate the airport’s future operations from any downturn as a function of Covid-related or any similar emergency in the future. But, it will also give us a revenue stream where we can do things like incent airlines to come here or lower the operating costs for airlines or passengers and be a more attractive airport and use (the new revenue) as a development fund to be able to bring in and incent other carriers.

“Land, for us, is really critical for the long term future, it is not for tomorrow, but we are working on it like it is. That land is so important to us.”

Currently, Saint John Airport has connections to Toronto’s Pearson and Montreal’s Trudeau airports, and last winter connections to Orlando with Flair Airlines. Ross said the airport is talking to Air Canada about more routes.