Cost-efficiency - Romania

Download Report

Terminal charging zone

Unit cost (KPI#1)

Actual and determined data
Total costs - nominal (M€) 2020-2021 2022 2023 2024
Actual costs 35 23 29 30
Determined costs 36 21 24 25
Difference costs -1 2 4 5
Inflation assumptions 2020-2021 2022 2023 2024
Determined inflation rate NA 9.3% 4.0% 3.0%
Determined inflation index NA 125.9 130.9 134.8
Actual inflation rate NA 12.0% 9.7% 5.8%
Actual inflation index NA 129 141.5 149.7
Difference inflation index (p.p.) NA +3.1 +10.6 +14.9

AUC vs. DUC

In 2024, the terminal AUC was +5.6% (or +65.40 RON2017, +14.32 €2017) higher than the planned DUC. This results from the combination of significantly higher than planned terminal costs in real terms (+7.4%, or +6.4 MRON2017, +1.4 M€2017) and higher than planned TNSUs (+1.7%). It should be noted that the actual inflation index in 2024 was +14.9 p.p. higher than planned.

Terminal service units

The difference between actual and planned TNSUs (+1.7%) falls inside the ±2% dead-band. Hence, the gain of additional terminal revenues is kept by the ANSPs (see items 10 to 13).

Terminal costs by entity

The 2024 actual real terminal ANS costs are +7.4% (+1.4 M€2017) higher than planned. This is the result of higher than planned costs for the main ANSP, ROMATSA (+7.8%, or +1.5 M€2017) and lower than planned costs for the NSA (-29.6%, or -0.1 M€2017).

Terminal costs for the main ANSP at charging zone level

The significantly higher than planned terminal costs in real terms for ROMATSA in 2024 (+7.8%, or +1.5 M€2017) result from:
- Significantly higher than planned staff costs (+10.4%), mainly due to “an increase of pension costs and compensation of personnel with inflation for meeting the capacity targets”.
- Significantly higher than planned other operating costs (+8.6%), due to “the recognition of operating costs related to adjustments for the impairment of current assets - receivables”.
- Significantly lower than planned depreciation (-25.5%), mainly due to the postponement of investment finalisation (i.e. Modernization of A-SMGCS at DSNA Bucharest, Advanced Tower Messaging).
- Slightly lower than planned cost of capital (-0.6%), mainly due to the above delayed investment “(…) partially offset by increasing interest rate for the contracted loan”.
- Lower than planned deduction for VFR exempted flights (-29.7%).

RP3 summary

When considering the whole of RP3 (2020-2024) for Romania terminal charging zone , actual TNSUs are -2.8% lower than planned, while actual costs in real terms are +3.8% higher than the determined costs (some +15.1 MRON2017 or +3.3 M€2017). As a result, the weighted average actual unit cost over RP3 (1 471.02 RON2017 or 322.15 €2017) is +6.7% higher than planned in the PP (1 378.36 RON2017 or 301.85 €2017).

Actual unit cost incurred by the users (AUCU) (PI#1)

AUCU components (€/SU) – 2024
Components of the AUCU in 2024 €/SU
DUC 308.45
Inflation adjustment 30.66
Cost exempt from cost-sharing -2.25
Traffic risk sharing adjustment 0.00
Traffic adj. (costs not TRS) -0.32
Finantial incentives 1.51
Modulation of charges 0.00
Cross-financing 0.00
Other revenues 0.00
Application of lower unit rate 0.00
Total adjustments 29.59
AUCU 338.04
AUCU vs. DUC + 9.6%
Cost exempt from cost sharing by item - 2024 €'000 €/SU
New and existing investments -278.4 -3.70
Competent authorities and qualified entities costs -53.8 -0.71
Eurocontrol costs 0.0 0.00
Pension costs 152.8 2.03
Interest on loans 9.8 0.13
Changes in law 0.0 0.00
Total cost exempt from cost risk sharing -169.6 -2.25

The actual terminal unit cost incurred by airspace users (AUCU) in respect of activities performed in 2024 (1 680.73 RON or 338.04 €) is +9.6% higher than the nominal DUC (1 533.60 RON or 308.45 €). The difference between these two figures (+147.13 RON/SU or +29.59 €/SU) is due to:
- the positive inflation adjustment resulting from higher than planned inflation (+152.42 RON/SU or +30.66 €/SU);
- the impact of adjustments resulting from the costs exempted from cost sharing mechanism (-11.20 RON/SU or -2.25 €/SU);
- the deduction of the traffic adjustment (-1.57 RON/SU or -0.32 €/SU) for the costs not subject to traffic risk sharing; and
- the financial incentives (+7.48 RON/SU or +1.51 €/SU).
The share of the regulatory result (see items 10 to 13) in the AUCU (before the deduction of other revenues) is -5.0%.

Regulatory result (RR)

ROMATSA net loss on activity in the Romania terminal charging zone in the year 2024

ROMATSA reported a net loss of -8.8 MRON, as a combination of a loss of -11.2 MRON arising from the cost sharing mechanism, with a gain of +1.8 MRON arising from the traffic risk sharing mechanism and a gain of +0.6 MRON relating to financial incentives.

ROMATSA overall regulatory result (RR) for the terminal activity

Ex-post, the overall RR taking into account the net loss from the terminal activity mentioned above (-8.8 MRON) and the actual RoE (+2.4 MRON) amounts to -6.4 MRON (-5.1% of the terminal revenues). The resulting ex-post rate of return on equity is -19.7%.

RP3 summary

When considering the whole of RP3 (2020-2024), ROMATSA generated a cumulative loss in respect of cost sharing of -19.3 MRON, as actual total costs for RP3 were higher than planned. The traffic risk sharing mechanism generated loss of -7.6 MRON. Adding the gain of +1.1 MRON to be retained by the ATSP in respect of financial incentives and the actual RoE (+14.7 MRON over RP3) leads to an overall regulatory result of -11.1 MRON, which corresponds to an average ex-post rate of return on equity of -6.8% (compared to 8.9% initially planned in the PP).