20260311-002 Financial Memo — original pdf

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TO: FROM: DATE: MEMORANDUM Airport Advisory Commissioners Rajeev Thomas, Chief Financial Officer, Austin Aviation March 11, 2026 SUBJECT: Austin-Bergstrom International Airport Financial Update January 2026 Financial Results Passenger and aircraft activity increased in January 2026 compared to the prior year because of growth in air service. Commercial airlines increased daily departures by 7% to 219, led by increased flight activity from Delta Airlines. As a result, passenger traffic increased 3% and landed weights increased 5% compared to the prior year. Cargo volume decreased 6% due to adjustments in air cargo carrier strategies and a decline year over year in domestic belly freight volume. Table #1 Enplanements Landing Weights Cargo Tonnage Operating Revenue Airport OPEX Total Requirements Net Income FY 2026 January FY 2025 January Variance Fav (Unfav) FY 2026 YTD FY 2025 YTD Variance YTD Fav (Unfav) 703,747 682,885 986,743,521 937,572,380 9,550 10,173 3.1% 5.2% (6.1%) 3,625,262 3,450,904 4,534,005,350 4,253,837,231 44,989 47,750 5.1% 6.6% (5.8%) $32,238,123 $25,788,907 $6,449,216 $144,008,174 $113,785,377 $30,222,797 $17,978,025 $16,412,105 ($1,565,920) $61,407,437 $55,792,962 ($5,614,475) $26,741,551 $25,451,585 ($1,289,967) $96,462,882 $88,456,898 ($8,005,985) $5,496,571 $337,323 $5,159,249 $47,545,292 $25,328,479 $22,216,812 Operating revenue increased 25% compared to the prior year and is comprised of 60% airline revenue and 40% non-airline revenue. The increase in operating revenue is mostly driven by increased airline rates and charges in FY2026 resulting from a new rates and charges methodology in the airline use and lease agreement. Airline revenue streams increased 44% due to the escalated rates and growth in aircraft activity. Non-airline revenue streams increased 5% due to growth in passenger traffic and increased parking rates. Food & beverage and retail revenue streams reflect reduced revenues for the month of January 2026 compared to the prior year because of corrections to revenue reporting from earlier months; year to date concessions revenue has increased from growth in passenger traffic. Airport operating expenses increased 10% compared to January 2025 because of growth in personnel and building maintenance costs. Improvement in employee vacancy rate and across the board wage adjustments drove increased personnel cost. The increase in maintenance expenses are driven by increased utilities costs, plumbing/electrical augmented staffing, and elevated preventative maintenance costs. Debt service cost declined 6% in January 2026 primarily because the 2019 refunding bond issuance was paid off. Other requirements increased 7% because of an increase in citywide allocated costs and increased transfers to the subordinate obligation fund from the initiation of the airport note purchase program in February 2025. Austin Aviation reported net income of $5.5M in January 2026, a $5.2M increase compared to January 2025. FY 2026 FY 2026 Budget vs. YTD Variance Budget vs. YTD Variance Table #2 Approved Budget - Seasonalized YTD $ Fav (Unfav) % Fav (Unfav) Operating Revenue Airport OPEX Total Requirements Net Income $139,797,788 $144,008,174 $4,210,386 $60,982,429 $61,407,437 $96,294,889 $96,462,882 ($425,008) ($167,993) $43,502,899 $47,545,292 $4,042,393 3.0% (0.7%) (0.2%) 9.3% Austin Aviation delivered favorable financial performance compared to the seasonalized FY2026 budget. Operating revenues exceeded the budget estimate primarily because of non-airline revenue performance resulting from strong passenger activity in January 2026. Operating expenses exceed seasonalized budget estimate by 0.7% because of elevated contractual and commodity costs for building maintenance and facility services. As a result of favorable activity compared to the budget, net income is 9% above seasonalized budget estimate. Attachments: January 2026 - AAC Financial Report