Post on 09-Sep-2020
CAPITAL MARKETS DAY HALLDÓR BENJAMÍN ÞORBERGSSON | SENIOR VICE PRESIDENT | ICELANDAIR GROUP
2
NUMBER OF TOURISTS ~ 800 K
Ι Is there a call for concerns regarding number of tourists in Iceland?
190 201 202232
263
303 296278
320
360 374
422
485502 494 487
566
672
781
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
3
NUMBER OF TOURISTS PER YEAR
Ι Around 800 thousand total tourists arrivals last year.
800,000 PER YEAR
= 1,000 visitors
4
# TOURISTS IN ICELAND PER SUMMER DAY
Ι On average there were around 45K tourists in Iceland
on any given summer day 2013.
45,000 EACH
SUMMER
DAY
= 1,000 visitors
5
# TOURISTS IN ICELAND PER WINTER DAY
Ι On average there were around 10K tourists in Iceland
on any given winter day in 2013.
10,000 EACH WINTER DAY
= 1,000 visitors
THE BIGGER PICTURE
0
5
10
15
20
25
30
35
40
45
50
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Summer (Jun-Aug) Winter (Sep-May)
Ι Average number of tourists on any given day in Iceland
Our own calculations
In thousands
HEAD COUNT IN ICELAND IN THE SUMMER TIME
0
50
100
150
200
250
300
350
400
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Ι Average number of persons in Iceland in the summer time
Tourists
Icelanders
∆ 30,000
∆ 36,000
325k
45k
THE NET EFFECT IS EVEN SMALLER
Ι Luckily, Icelanders travel abroad in the summer time.
Ι On average, there are ~20 thousand Icelanders abroad on any given day in the summer.
Ι Therefore, the net effect is much smaller
Ι Best estimate
+25K to total population
Ι 325 + 25 = 350 K as total headcount
7% EFFECT ON DOMESTIC HEADCOUNT AT PEAK
13.222 19.203 24.343
-
50.000
100.000
150.000
200.000
250.000
300.000
350.000
400.000
2012 2013 2014
Marginal addition of tourists net of Icelanders abroad Iceland population
TOURISTS PER NATIVE?
Ι Is that a helpful measure?
Ι At best Iceland is placed at the middle of the league of nations with population < 5 million.
0
5
10
15
20
25
30
Andorra
Monaco
IcelandSan Marino
Croatia
Source: World Bank
103,000 KM2
TOURISTS PER SQUARE KILOMETRE
0
50
100
150
200
250
300
350
400
Luxembourg Netherlands Cyprus Switzerland Denmark Croatia France Sweden Iceland Honduras
Source: World Bank
10,300 km2
LET‘S BE MORE FAIR IN OUR APPROACH
Ι Let’s exclude 90% of the land mass due to dense population and rough terrain
LET‘S BE MORE FAIR IN OUR APPROACH
Ι Let’s exclude 90% of the land mass due to dense population and rough terrain
0
50
100
150
200
250
300
350
400
Luxembourg Netherlands Cyprus Switzerland Denmark Croatia France Iceland,90% exluded
Sweden Iceland Honduras
81
Source: World Bank
3,000 km2
… OR TAKE IT TO THE EXTREMES
Ι Let’s exclude 97% of the land mass due to dense population and rough terrain
… OR TAKE IT TO THE EXTREMES
Ι Let’s exclude 97% of the land mass due to dense population and rough terrain
0
50
100
150
200
250
300
350
400
Luxembourg Netherlands Iceland,97%
excluded
Cyprus Switzerland Denmark Croatia France Iceland,90% exluded
Sweden Iceland Honduras
268
Source: World Bank
PREVALENT WORDS ABOUT ICELAND ARE POSITIVE
Ι The overall conversation is positive. We do not see terms like sold out, congestion, spoiled, or expensive.
Ι Iceland has mainly positive mentions
Ι Tourists are simply not talking about congestion in Iceland or at Iceland’s top tourist sites
Source: Ubervu
WE CAN ALWAYS DO BETTER
Ι Golden Circle with thousands of guests per day.
Ι Need to manage traffic better at top sites – number of tourists is not the problem – lack of management and infrastructure
Ι Urge use of market mechanisms with price as the incentive for changed behaviour key to success.
Ι Number of tourists should ideally continue to increase.
WELCOME MORE GUESTS:
ECONOMICALLY BENEFICIAL FOR US ALL
HE PROFITS FROM IT …
… SO DOES SHE
TOURISM & AVIATION LOCOMOTIVE OF GROWTH
-45%
-29%
-14%
-6%
-4%
-3%
0%
1%
-50% -40% -30% -20% -10% 0% 10%
Construction
Finance
Retail and wholesale
Other
Tourism and transportation
IT and telecommunications
Fisheries
Metal production
60%
11%
11%
10%
10%
9%
-2%
-8%
-20% -10% 0% 10% 20% 30% 40% 50% 60% 70%
Tourism and transportation
Other
Fisheries
Construction
Retail and wholesale
IT and telecommunications
Metal production
Finance
Ι Contribution to economic downturn 2008-2010 Ι Contribution to economic growth 2010-2013
TOURISM IS THE SOURCE OF GROWTH
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
3%
4%
2010 2011 2012 2013
Economic growth excluding tourism Economic growth with tourism
Ι Limited economic recovery if we exclude tourism
7% GDP ADDITION SINCE 2010
90
92
94
96
98
100
102
104
2009 2010 2011 2012 2013
GDP with tourism GDP excluding tourism
WHAT DOES THIS ALL MEAN?
Ι Iceland is not sold out – we are far from reaching our upper limit
Ι The upper limit is not static – it is dynamic and evolves and expands over time
Ι However, we can smooth the transition by focusing on managing peek sites better
Ι Tourism is the locomotive of the Icelandic economy