(Yicai Global) Feb. 1 -- Shares in Shanghai International Airport, operator of two of the country’s busiest airports, plunged by the exchange-imposed daily limit today on the news that it is anticipating losses of as much as CNY1.29 billion (USD200 million) in 2020 due to the negative impact of the Covid-19 pandemic on global travel.

Shanghai Airport’s stock price [SHA:600009] plummeted 10 percent to close at CNY71.10 (USD11).

Rental income from duty-free shops at Hongqiao International Airport and Pudong International Airport, which made up nearly half of Shanghai Airport’s revenue in 2019, plunged 78 percent last year from the year before due to the pandemic, the firm said on Jan. 30.

Its 2020 deficit widened considerably from the CNY386 million (USD59.8 million) of losses it logged in the first half of the year. Revenue was down 54 percent in the six months to June 30 last year from the same period in 2019 to CNY2.5 billion.

Despite the sharp drop in passenger traffic, the airport operator still had to make a big outlay on epidemic prevention measures and was unable to make significant reductions to its labor force or scale of operations, China Merchants Securities said in a recent report.

However, in the medium to long term, there is reason to remain optimistic, it added. Pudong International Airport is planning a third terminal that will be able to handle 40 million passengers a year and should bring profit.

Due to the uncertainty brought on by Covid-19, the firm has signed a sales commission contract with the duty-free shop operator Sunrise Duty Free Shanghai to help run its tax-free shops, Shanghai Airport said.

Editor: Kim Taylor