The financial status quo could have consequences for Aéroports de Montréal (ADM): for lack of new ways to raise money, Montréal-Trudeau will not be able to finance its expansion “at the right time” without displeasing the rating agencies. In the hope of convincing Ottawa, the non-profit organization (NPO) has just hired lobbyists – something extremely rare.
Without much fanfare, ADM recently entered the federal registry of lobbyists – where its name did not previously appear – by retaining the services of four specialists. Their mandate essentially concerns everything that revolves around airport charges and the “fiscal relationship” between the federal government and Montréal-Trudeau.
The most recent report from the operator of the Montréal-Trudeau and Mirabel airports provides an overview of the challenges facing the organization. According to the document, it should be possible to finance “short, medium and long-term” projects while maintaining a credit rating of A – the minimum threshold for a “quality” bond – with rating agencies. It is when the time comes to think about an expansion in order to meet increasingly vigorous demand, particularly since the lifting of health restrictions, that there is a risk of problems.
“We have to plan them and start the work as soon as possible to keep up with the pace, and it is in this sense that a change to the structure to allow the injection of capital becomes necessary”, underlines the director of communications at ADM , Anne-Sophie Hamel, in an email.
In the 1980s, Ottawa decided to transform the airports into NPOs which must pay for the occupation and use of federal lands. In the vast majority of cases, the leases are staggered over decades (until 2072 for Montreal).
The law prohibits them from raising share capital while the profits made must be invested in the facilities.
ADM already has several projects on the drawing board. The new parking lot (P4) must be completed and the station that will house the Réseau express métropolitain (REM) must be completed. The organization has also already displayed its colors with regard to the repair of the landing stage “on the land side”. According to its annual report, after 2028, a “series of projects” on the “airside” are planned to increase the capacity of barriers and baggage handling.
Recurring request
Time and time again, the organization’s outgoing president and CEO, Philippe Rainville, has repeated that airports should have the right to welcome private investors, such as pension plan managers, who are willing to be patient.
“Sooner or later, the funding model will have to be adapted to the reality of needs,” he pleaded last May during the public assembly. In the meantime, we are doing the best we can with rigor and good heart. »
After the tremors of the pandemic, ADM’s financial situation is slowly improving. As of December 31, its net debt stood at $2.3 billion, compared to $2.5 billion at the same time in 2021.
According to Mme Hamel, the NPO retained the services of lobbyists because “the current context lends itself well to it”. She recalled the holding of a summit on the resumption of air transport in November and the launch, by the federal Minister of Transport, Omar Alghabra, of consultations on the airline industry.
” [Le ministre Omar Alghabra] made several statements indicating that he wanted to make adjustments to the system, without specifying the nature of them, ”wrote Mme Hamel.
To change
Professor at UQAM and director of the Observatory of Aeronautics and Civil Aviation, Mehran Ebrahimi believes that Canadian operators find themselves in a kind of “in-between”. They are not the responsibility of states or counties as is the case south of the border and cannot be privatized as in Europe.
We are between the two, but in the wrong sense of the term.
Mehran Ebrahimi, Director of the Aeronautics and Civil Aviation Observatory
“Let’s be pragmatic and ask for a tax system that does not result in the financialization of the airport,” says the expert. We do not go to the markets to collect American capital which demands high returns. With patient capital, one can invest and have the time to do so. »
Mr. Ebrahimi is not the only observer to plead for changes. In a report from the Standing Committee on Transport, Infrastructure and Communities tabled in the House of Commons last February, aviation expert and McGill University lecturer John Gradek argued for “private investment. »
In his opinion, the time has come to offer an “alternate vehicle” for airport financing, including the “leveraged” and “user-pays” model.
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- 96.7%
- For the months of January, February and March, the volume of passengers at Montréal-Trudeau corresponded to 96.7% of the pre-pandemic level.
Montreal airports