Bangkok--3 Mar--Centre for Asia Pacific Aviation Asia’s biggest LCC airport just got bigger — Kuala Lumpur drives Malaysia Airports’ earnings Malaysia Airports Holdings Bhd (MAHB) reported a 20.7% year-on-year increase in revenue in the 12 months ended 31-Dec-07, while EBITDA soared 42.6% year-on-year, thanks mainly to AirAsia’s increasing network. MAHB’s EBITDA margin last year rose 6.1 ppts year-on-year to 39.5%. Of the total operating revenue, 50.0% was from aeronautical sources (up 17.4% year-on-year), with 28.7% from non-aeronautical activities (up 20.6%), and 22.8% from retail operations (up 16.7%). 26.5 million passengers passed through Kuala Lumpur International Airport (KLIA) in the 12 months ended 31-Dec-07, representing a 9.6% year-on-year increase. But it was a tale of two terminals. Total passenger numbers at the low cost carrier terminal (LCCT) surged 64.9% to 7.7 million passengers, thanks to AirAsia. Of this, international passenger numbers increased 79.2% to 3.3 million, while domestic passengers rose 55.7% to 4.4 million. The KLIA LCCT is reviewed in more depth in the new 270-page report, Low Cost Airport Terminals, published today by the Centre for Asia Pacific Aviation. In 2007, LCCT passenger movements represented 29.1% of total traffic at KLIA, up significantly from 19.4% in 2006. In 2007, passenger movements through the main terminal building fell 3.6% year-on-year, as Malaysia Airlines trimmed its network to return to profitability. To accommodate its new-found LCC hub status, MAHB recently announced plans to fast track the development of the new Low Cost Carrier Terminal (LCCT) with capacity to accommodate 30 million passengers p/a. The new terminal will replace the temporary facility in 2010. According to MAHB, when the existing USD31.2 million LCCT opened in Mar-06, MAHB expected it to reach its 10 million capacity by 2012. But traffic at the terminal surpassed 7.7 million in 2007 and an interim expansion of the existing LCCT is scheduled to commence in early-08, to provide more space for food and retail outlets, and to accommodate widebody aircraft. The current location was chosen as it had an existing apron, allowing the terminal to be completed in a nine months. AirAsia is targeting 20 million passengers for 2008, and expects to achieve its target of 70 million passengers p/a from 2014, as set out in the airline’s six-year business plan. This would make AirAsia the largest carrier in Asia, and the fastest growing LCC in history. AirAsia has orders for a total of 175 A320s, as well as 50 purchase options, which make it the largest operator of the type in the world. The new LCCT, which will cater mainly to AirAsia, will be located adjacent to the main terminal, will boost total airport capacity by approximately 60% to 55 million passengers p/a. Australian LCC, Jetstar, meanwhile is considering Kuala Lumpur as one of five potential bases in Asia for one-stop services to Europe. While the chances of Jetstar going head-to-head with AirAsia and AirAsia X are slim, MAHB will be targeting the airline nonetheless. MAHB, probably more than any other airport operator in this region, is embracing a low cost future. It is gaining valuable cutting-edge experience that the group will be able to export to airports in other countries that are riding the LCC wave.