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Letter to Stakeholders

Our company enjoyed an excellent year in 2017, in terms of both traffic volumes – up by 9.0% for passengers and by 7.1% for cargo (compared to the Italian national averages of +6.4% and +9.2% respectively) – and of operating results, with an increase in EBITDA from Euro 239.8 million to Euro 264.0 million (net of non-recurring revenues and costs).

The results for the year are also significant as marking a fundamental shift, the effects of which will persist for some time: the end of a long period of difficulty that began in 2008 with the de-hubbing by Alitalia and the dawn of a new era in which the Milan airport system and its management company can legitimately aim to compete with Europe's foremost airports, in keeping with the renewed ambitions of the local community and its metropolitan center.

Malpensa began a new chapter in its history in 2017, ending its traditional dualistic relationship with Linate and returning to its originally intended role as a crucial component of northern Italy's infrastructure serving both short and long-haul passengers and cargo routes. Malpensa reported for 2017 passenger number growth of 14.1%, a gain of more than twice the Italian national average and outperforming the European average by 7.9 percentage points, finally approaching the previous high reached in 2007 and 27% above the low of 2009.

The process took a decade to complete and was not an easy one.

It was supported by efforts to promote Milan from 2015 and was also made possible by SEA's commitment to revamping its infrastructure - beginning with the radical restyling of Terminal 1 - by boosting operating efficiency and by cultivating relationships with new carriers and routes.

Today Malpensa is well positioned to lay claim to being one of Europe's foremost “point-to-point” intercontinental airports. Its competitive strengths include the number of airlines serving it, the lower level of concentration of these airlines than at most competing airports (the main airline carries approximately one-third of its passengers), its extensive catalogue of routes and destinations and its significant potential for additional development before reaching the levels of saturation typical of many other large and mid-size European airports, which not infrequently prove highly constraining for growth. 

Malpensa is Europe's fifth-largest cargo airport and in 2017 it accounted for 52% of the total volume of goods handled by Italian airports.

As Malpensa grows, Linate is consolidating its traffic volumes (while posting a 1.4% decline in passengers tied to the transfer of several Continental routes to Malpensa). It remains essential to business traffic and continues to rank among the best-connected city airports in Europe located in a major metropolitan center.   

SEA is committed to building on its current success in pursuit of sustainable, high-quality development.

The aspects of sustainability considered extend to all of the crucial dimensions of an airport's existence, starting with the fundamental value of security.

The company remains committed to refining its methods of measuring the actual and perceived quality of our infrastructure and the related services, while continuing to improve them. In 2017 progress was made on almost all indicators, but there is always room for further improvement.  

Collaborative, concerted and motivated shareholders are also essential to sustainable growth. The company has set itself challenging organizational goals, based on investing in individual responsibility in view of trust, proactive collaboration and a result-oriented approach, which are expected to yield measurable results in terms of the quality of the overall performance and the sustainability of results over the medium term.

Within the framework of constant, transparent dialogue with trade unions, SEA remains committed to training (dedicating over 57,000 hours, equivalent to training for 33 people every day), improving working conditions and safeguarding company welfare. The many facets of this commitment include measures aimed at meeting old and new needs and initiatives that seek to set a better work-life balance.

As part of this same process, dialogue with local communities continues, in constant pursuit of the best possible balance between opportunities for airport growth – a valuable means of connecting communities and providing employment – and strict compliance with environmental restrictions.

The process of drafting and approving the Malpensa Master Plan is based on a transparent, participatory process that is destined to yield positive results.

The quality of growth is particularly focused on, as required by law, in this Non-Financial Statement dedicated to social, environmental and governance sustainability, alongside the Financial Statements.

SEA regards non-financial reporting as a challenge with deep roots in its business, in view of the need seen in recent years for an increasingly clear and measurable account of that intensive process of exchanges of value with our stakeholders that serves as a foundation for our resilience in the face of adversity, as well as for our aspirations to excellence.

The strategic key to interpreting this document has been clearly provided in the form of the arrangement of the topics discussed.

The topics discussed in this document have been classified by stakeholder (environment, personnel, passengers, suppliers, etc.), but have been rearranged into four sections, each of which represents a pillar of our business plan (management and development of infrastructure, traffic growth, development of the non-aviation business, and efficiency and productivity). It is our view that environmental, social and stakeholder relations issues are not an extraneous addition to the business process but the natural next step in this process, in which to invest to facilitate – or at least to avoid undermining or delaying – pursuit of the goals which we have set for ourselves.

Our policies, which describe how we approach our stakeholders' interests and the prerogatives they express in their relations with us, are not mere impromptu reflections, but rather organic components of a governance model in support of our sustainability strategy – described in a specific section of this document – designed to ensure consistency and depth for our fundamental vision.

We have provided a thorough account of our airports' competitive performance, in which we seek to combine a representation of the financial side of our business with a discussion of the actual quality of the aviation and non-aviation services provided, from the perspective of their users.

The gradual refinement of methods of estimating the direct and indirect socio-economic effects of our airports' operations for the benefit of the local community allows us to provide an extensive, effective account of our overall impact.

Our performance in environmental and social terms – reflecting the steps taken thus far to lend substance and concreteness to our commitment to assume responsibility for the consequences of our actions – emphatically includes the perspectives of our stakeholders.

In conclusion, the efforts made by SEA – even in difficult years – to protect and develop a harmonious airport system with the capacity for sustainable growth, capable of living up to the ambitious goals and potential of its community, bore fruit in 2017 - in terms of both operating results and traffic growth.

Now the challenge is to ensure excellence, to promote the development of the Milan metropolitan area and to provide Lombardy with increasingly efficient, accessible and well-connected airports, to help meet the challenges posed by globalization and boost the region's attractiveness and hospitality.

SEA has prepared itself for this challenge above all through the dedication of its workers, who deserve the company's gratitude for the results that have been achieved thus far and that will certainly continue into the future.


Pietro Modiano