Infrastructure Investment Appraisal

Capital expenditure (capex) typically consumes a large share of an airport’s cash flow.
Investment profile is driven by a number of variables including available peak hour capacity and the airport’s stage in the development and maintenance cycles.
Some frequently used metrics such as return on capital employed (ROCE) can mask underlying performance.

Our Approach

We help airports develop flexible capital plans, aligned with shareholder target returns. This can either support specific projects (e.g. project appraisal, planning applications) or encompass wider support (e.g. master planning, airport strategy, business plans).
Our main services are:
- Analysis of historic capital investment comparing growth projects, asset renewals and per passenger investment.
- Review of existing capital investment plans.
- Development of flexible capital investment forecasts models including high level terminal, surface access and airfield design in line with busy hour passenger demand.
Our advice is supported by our in-house terminal and airfield capacity model, and benchmarking of capacity and capital investment from a wide range of global airports. Secondary forecasts (terminal busy hour rates, peak runway movements, peak stand demand) are developed to translate annual forecasts into peak hour demand infrastructure requirements, with outputs benchmarked against global airports.
Flexibility is built into the modelling to enable reaction to traffic growth which may be higher or lower, or to defer/reduce investment whilst maintaining traffic growth. The analysis integrates with financial modelling to provide accurate financial returns forecasts for the airport and shareholders.