Scope of operations

Two factors have the greatest impact on the scope of Isavia’s operations: the number of flight movements and the number of passengers. Isavia’s income from Keflavík Airport can be attributed first and foremost to the airlines that land at the airport, concession revenues from food and beverage and retail outlets as well as other income from renting facilities.

As a whole, the company’s operations have lessened in scope as compared to last year. Domestic flight passenger throughput decreased by around 11.4%, while the number of international passengers travelling through domestic airports decreased by 18.9%. At Keflavík Airport, the number of passengers decreased by 26%, and traffic in Icelandic airspace increased by 7.5% in 2019.

Three aircraft operators ran scheduled flights within Iceland, i.e. Air Iceland Connect, Flugfélagið Ernir and Norlandair. Other aircraft operators who regularly used Isavia services were Mýflug, Circle Air, Atlantsflug and Norðurflug. Vesturflug / Blue West and Helo operate a helicopter service at the company’s airports.

Air Iceland Connect flies from Reykjavík to several locations in Greenland. In addition, the Icelandic Flight Academy (Flugskóli Íslands) and Flugfélagið Geirfugl have facilities at Reykjavík Airport. BIRK Flight Services, Reykjavík FBO and Air Iceland Connect are responsible for ground handling services at airports.

The largest customers of Isavia’s flight navigation services are Icelandair, United Airlines, Lufthansa, SAS, Delta Air Lines, British Airways, Air Canada, Emirates, Air Greenland, US Privat, Qatar, Norwegian and KLM. These airlines fly the greatest number of kilometres within the Icelandic flight traffic control area. Icelandair is the largest user of the flight navigation services at Keflavík Airport.

During the summer of 2019, 25 airlines flew from Keflavík Airport to more than 70 destinations. Fourteen airlines flew to and from Iceland all year round: Icelandair, easyJet, Wizz Air, SAS, Lufthansa, Norwegian, Finnair, British Airways, Czech Airlines, Atlantic Airways, Transavia, Air Baltic, Air Greenland and Neos. Three airfreight airlines – Icelandair Cargo, Bluebird and DHL – fly from Keflavík Airport throughout the year.

Four handling agents operate at Keflavík Airport: Icelandair, Airport Associates, ACE FBO and South Air.

Numerous passengers take advantage of Keflavík Airport as a transit airport, and Icelandair uses the airport for such purpose on routes between Europe and North America. The minimum flight connection time for passengers at Keflavík Airport is 25 minutes.

Isavia has, with the assistance of an incentives system, been quite successful in getting airlines to fly to Iceland over the winter months. In addition, Isavia has marketed time slots outside peak hours each day, with the aim of making better use of the airport’s facilities.

Keflavík Airport has two runways, which are 3,054 and 3,065 m long.

Value creation

Isavia is a company that plays an important role both community-wise and in an economic sense. Isavia’s airports, especially Keflavík International Airport, create value for the community and the economy, both in Iceland and elsewhere in the world. Direct flight connections are extremely important. The more direct connections by flight from Iceland to the main cities of the world, the easier it is for Icelandic companies and private persons to engage in business overseas and export goods and seek international experience. In addition, they increase the interest of overseas companies to begin operations in Iceland. An analysis has been carried out in Europe which indicates that an increase in flight connections of 10% produces 0.5% economic growth.

Airports are important business centres and directly and indirectly strengthen the creation of economic and social value for the communities that their operations touch. Being located close by an airport allows companies and their value chains to enjoy the benefits of their close proximity and directly and indirectly support positive economic developments for such areas.

Isavia has, through e.g. the preparation of its Masterplan to 2040, examined the possibility of constructing, in the operating area of the airport, an Airport City. There are numerous opportunities that arise from creating an Airport City. This consists of the area that covers the airport, the terminal, cargo areas, office buildings, shops and services as well as hotels. The area could support the development of operations, both flight-related and non-flight-related, and enjoy the benefits of being located near an international airport with strong flight connections to gain a competitive edge. Clear policies towards such goals can result in an increase in goods and services transactions, attract increased foreign investment in Iceland, increase the number of valuable jobs and increase the prosperity of all Icelanders.

A total of 697 employees work in the largest operation unit of Isavia at Keflavík Airport. In addition, hundreds of employees work in other companies that have operations in direct connection with the airport. Approximately 220 companies have long-term access authorisations to Keflavík Airport. These are companies or public bodies with facilities within the airport and the companies that provide them with services.

Isavia’s contribution to the community consists of a range of different elements. Some of Isavia’s contributions are in the form of taxes and public levies that the Group pays or collects, together with matching contributions to employee pension funds.

Direct economic value generated and distributed GRI 201-1