MAHB expects challenging 2022 for its retail sector

by SHAFIQQUL ALIFF / pic credit:

MALAYSIA Airports Holdings Bhd (MAHB) expects its retail sector to be challenging for 2022 due to the extension of the Enahanced Movement Control Order (EMCO).

Senior GM for commercial services Hani Ezra Hussin said it is difficult to forecast the retail performance for next year, adding that it is likely for the airport operator to return to pre-pandemic level in 2023.

“We believe that we will be looking at about minimum 50% passengers in 2022 based on data that have been received since 2019. So, for us to put a figure is depending on the government action for the retail sector in (order for) MAHB to return to normalcy.

“We are actually looking forward to domestic borders being opened first, as well as international, and once the world can agree on the standards for the health passport between the countries,” she said at a media briefing on MAHB’s commercial reset at its network of airports yesterday.

The commercial reset is part of MAHB’s pandemic response plan as international and interstate travel restrictions keep passenger numbers low.

The reset is done concurrently with the expiry of the bulk of tenancy agreements in 2020.

MAHB expects to complete its outlet tender exercise by 2023, with 435 of 814 outlets already tendered out as of July 2021.

Hani also said that MAHB intends to provide no less than RM400 million in rebates and incentives to the airport retail industry this year.

More than 50% rebates to all its tenants as well as tenancy contract extensions were introduced last year and continued this year as the pandemic lingers.

“We have no choice but to provision nothing less than what we gave last year to more than 278 tenants in terms of rental assistance this year.

“The two-year contract extensions are granted so that they can focus on investing in their outlets rather than worry about whether they can pay their rental,” said Hani.

Shares in MAHB fell two sen or 0.34% to RM5.81 in afternoon trading, valuing the group at RM9.64 billion.