KPMG Report:
Linz Airport Said to Have a Negative Value
How much is Linz Airport worth? To find out, the city commissioned a report from the auditors at KPMG. The report is now available: it appears to assign the airport a negative value.
Kronen Zeitung als bevorzugte Google-Quelle hinzufügen The KPMG report in question arrived at the City of Linz’s Finance Department on Monday, as confirmed to the “Krone.” It will now be reviewed by the city. As reported, the report was intended to serve as a basis for negotiations with the state of Upper Austria. The state wants to acquire the city’s shares in the airport—currently, both parties each hold half of the airport. A sale would also be convenient for the city, as the airport places an additional strain on the city’s already strained finances.
According to a report in the “OÖN,” the appraisal now even assigns the airport a negative value based on the so-called discounted cash flow method (a method for valuing companies). The liquidation value—that is, the proceeds if the company were dissolved and all assets sold—is estimated at two to four million euros. This figure does not yet include the necessary runway renovation or impending damage claims from nearby residents due to contaminated wells.
The airport’s financial situation is strained
It is well known that the airport’s financial situation is not rosy: Last year, the state and the city had already had to provide a shareholder subsidy of eight million euros. Over the next four years, the state will inject a total of up to 36 million euros into the Linz-Frankfurt route as start-up financing. And according to an audit report by the State Court of Auditors, the airport will also need an additional 27.6 to 45 million euros by 2035—and that does not include the costs of remedying past environmental damage.
The state, however, points to the importance of having its own airport for the region and cites a study by economist Teodoro Cocca of Linz’s Johannes Kepler University, commissioned by the state, which estimates the airport’s annual economic value added at 128.5 million euros.
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