Topic: FWAG released better than expected June traffic results that marked new records.

Strong June traffic results: Group passenger numbers rose by 8.4% yoy to 3.97m (eNuW: 3.84m). While Vienna grew by 6.5% yoy to 3.02m passengers (eNuW: 2.95m), Malta - a desired summer destination - grew by +14% yoy to 0.86m (eNuW: 0.76m).

Q2 and YTD well above prior year: Q2 passenger numbers rose by 8% (YTD: +10%), despite rising ticket prices and geopolitical uncertainties, highlighting the unbroken demand for air travel.

Q2 results to come in strong:  The 8% increase in Q2 passengers coupled with the 9.7% increase in airport charges (c. 40% of group sales) indicate a strong top-line growth for Q2'24e, which we expect to come in at € 275m (eNuW, +11% yoy).

Busy summer in full swing: On June 28th, Vienna Airport recorded the strongest travel day in history while last month was also the strongest June ever recorded, highlighting that the airport successfully handled the start of the summer holidays in Austria. For Q3, this should also bode well, as the outgoing traffic will eventually become incoming traffic again.

Continued airline expansions at Vienna Airport: New airlines start to serve the destination Vienna (e.g. UAE's low cost carrier Air Arabia, starting in Dec.'24) but also existing airlines increase their fequencies (e.g. Air China operating daily as of Jul. '24) or serve new destinations (e.g. AUA now serving Boston) in order to meet the strong demand for air travel from and to Vienna.

Highest service quality maintained: While Vienna held its position as the most punctual Lufthansa hub, Malta airport has been awarded the best airport by ACI (5-10m passenger category).

Action: While the initial outlook from Nov'23 for this year has been rather muted, the dark clouds have made way for sunny weather, visible by the strong passenger development so far. We now lift our FY'24 passenger estimate to 40.6m (old: 40.2m) and consequently increase our PT to € 59.00 (old: € 58.00), however, the 16% upside is still not high enough to justify a BUY recommendation.

Consequently, we remain at our HOLD recommendation for now, but also highly appreciate the strong operating performance.