Fraport Shares Surge Following New Airport Fees Agreement

Investing.com -- Fraport AG (FRA:FRA) shares closed up 4.3% today after the company announced it had signed a four-year advantageous airport charges agreement with its airline partners. The deal, a pleasant surprise for investors, aligns with Fraport's initial guidance for the first year and extends pricing certainty beyond the previously anticipated one-year period.

Announced alongside Fraport's third-quarter results, the agreement forecasts an average 4% increase in charges over the next four years. For 2025, airport charges for Origin & Destination (O&D) passengers are set to rise by 6.8%, while fees for transfer passengers will increase by 5.0%, resulting in an average rise of 5.7%.

The agreement also introduces incentives for long-haul traffic growth and more modest fare increases for transfer traffic, potentially encouraging Lufthansa to enhance its hub operations in Frankfurt. Over the next three years, differentiated growth rates are maintained, with the average increase declining to 3.9% in 2026, 3.4% in 2027, and 2.7% in 2028.

These structured increases are designed to provide airlines with a predictable cost structure while supporting the reconstruction of the hub function at Frankfurt Airport. Barclays analyst Andrew Lobbenberg commented on the agreement, stating: "While there are discrepancies between the tariff forecasts released with this agreement, these differences fall within the variability that could arise from a different traffic mix or the effects of incentives."