NAD: Fiscal year 2019 ‘best year ever’

NAD: Fiscal year 2019 ‘best year ever’
Aerial shot of the Lynden Pindling International Airport (LPIA).

Walkine: Higher tourist traffic created by Baha Mar proved ‘cannibalization’ fears unfounded

NASSAU, BAHAMAS – The Nassau Airport Development company (NAD) recorded its ‘best year ever’ in fiscal year 2019 which ‘surpassed all expectations’ according to executives with the airport operator had finishing the year with a $7.8 million profit.

However, NAD’s chairman Walter Wells noted such growth cannot go on forever, with Nassau’s hotels already reporting close to capacity occupancy rates.

“Fiscal year 2019 was quite simply NAD’s best year ever,” said Wells in NAD’s 2019 annual report released yesterday.

“Over 3.9 million passengers travelled through the airport – an increase of 14.4 per cent over last year. Revenues also rose to $108.2 million with NAD finishing the year with a profit of $7.8 million.”

Wells said: “The driver behind this breathtaking growth was undoubtedly the opening of Baha Mar and the significant marketing push that accompanied it. Additional marketing campaigns by existing hotels Atlantis, Paradise Island and Sandals Royal Bahamian along with the Ministry of Tourism and Nassau Paradise Island Promotion Board had the effect of further raising the profile of The Bahamas as a vacation destination.”

Wells noted that growth was felt the most in the first quarter of 2019 with passenger volumes growing by 29 per cent year over year in February and 12.8 per cent in March.

“Even with this unprecedented increase in passenger traffic, NAD was still able to maintain and even improve its customer service standards – earning its highest score ever for cleanliness,” he said.

“This is thanks to the tremendous support and cooperation that NAD has received from its airport partners as well as the addition of 36 new employees to NAD’s team of 252 people.”

Due to higher revenues from increased passenger traffic and lower costs following the debt restructuring, Wells said NAD was able to undertake significant investment projects that will help improve the operational efficiency of the airport and set it up for future growth.

“One such project is the $20-million rehabilitation of Runway 09/27 and Taxiway India that will upgrade and increase the lifespan of this key part of LPIA’s airside infrastructure,” he said.

“While NAD’s success this past year is something to celebrate, it is also important to recognize that such fast-paced growth cannot go on forever. Nassau hotels are already reporting close-to-capacity occupancy rates as the additional rooms created by Baha Mar have been absorbed by the market.

“Until more hotel capacity is brought online, we should expect passenger traffic growth to slow down to a more moderate level.”

NAD’s President and CEO Vernice Walkine underscored the impact of Baha Mar’s opening on passenger numbers.

“To say that 2019 surpassed all expectations would be an understatement,” Walkine said.

“The long-awaited opening of Baha Mar and the multimillion-dollar advertising spend that accompanied it generated a tourism boom that led to NAD registering its best year ever in terms of passenger numbers and revenue. The fears that Baha Mar would cannibalize guests from existing hotel properties proved to be unfounded.

She added: “In fact, tourist traffic was even higher than the extra capacity created by Baha Mar because of the growing popularity of Airbnb and other short-term rental platforms. All of this meant that LPIA was faced with an unprecedented level of passenger traffic.”