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Sydney Airport share price on watch after traffic update

Sydney airport
Credit: deeplimo

The Sydney Airport Holdings Pty Ltd (ASX: SYD) share price will be on watch today after the release of its latest traffic update.

What did Sydney Airport announce?

This morning the airport operators released its passenger traffic numbers for the month of May.

Once again, Sydney Airport’s terminals resembled a ghost town last month, with barely any passengers passing through its gates compared to previous times.

According to the release, the airport welcomed 62,000 domestic passengers through its gates in May. This is down 97.2% on the same period last year when over 2.2 million domestic travellers used its airport.

Unsurprisingly, it was even worse for its international terminal. Just 29,000 international passengers travelled through the airport last month. This is a 97.7% decline on the ~1.3 million passengers passing through its gates in May of last year.

What about year to date?

After a solid start to the year, the company’s year to date performance has been materially impacted over the last few months.

Year to date domestic passenger numbers are down 49.2% to ~5.7 million. Whereas international passenger numbers are 49.8% lower year to date at just over 3.5 million.

Combined, the airport has recorded a 49.4% decline in passenger numbers to ~9.2 million in 2020.

That’s a whopping 9 million less travellers than the same period last year. I feel this highlights just how hard things have been for the likes of Sydney Airport, Qantas Airways Limited (ASX: QAN), and Webjet Limited (ASX: WEB).

What now?

With social distancing restrictions easing and a number of state borders opening up, the travel market is now starting its recovery.

This will make June’s data arguably the most highly anticipated release out of Sydney Airport in some time.

Management wasn’t giving much away and once again stated: “We expect the downturn in passenger traffic to persist until government travel restrictions are eased.”

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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