Business World

Tuesday 24 October 2017

BAA books £665m charge over Gatwick sale, pensions

John Mulligan

John Mulligan

BAA, the Ferrovial subsidiary that owns UK airports including Heathrow, booked a £665m (€755m) non-cash charge last year after it sold Gatwick Airport last month for £1.5bn and dealt with a widening pension scheme deficit.

The operator, which also owns Ryanair's busiest base, Stansted, said passenger traffic at the two London airports it owns dropped a combined 3.8pc to 85.9 million.

Passenger numbers at Stansted slumped 10.7pc to 20 million, while Heathrow's were 1.5pc lower at 65.9 million.

Releasing full-year figures for the two airports, BAA said that it incurred a £277m non-cash loss related to its forced sale of Gatwick after the UK's Competition Commission ruled that BAA must offload some airports. A further £218m charge related to a deficit in BAA's defined benefit pension scheme.

The company said that despite the fall in passenger numbers, its revenue for 2009 from Heathrow and Stansted rose 8.3pc to almost £1.98bn , while earnings before interest, tax, depreciation and amortisation jumped 17.1pc to £885m.

However, while BAA's adjusted pre-tax loss for 2009 improved to £156m from £189m, its pre-tax loss slumped to £822m from £324m.

BAA chief executive Colin Matthews said that the group's financial performance "remains resilient", especially at Heathrow.

"We expect 2010 to present further economic challenges for the industry as a whole," Mr Matthews said.

Passenger numbers at Heathrow had recovered during 2009, according to BAA, with year-on-year growth of 0.3pc and 1.1pc in the third and fourth quarters, respectively.

It added that the recovery in the second half of the year reflected growth in emerging market long-haul markets, and on European routes.

At Stansted, declines during 2009 also moderated from a year-on-year fall in passenger numbers of 14.6pc in the first quarter to a 5.7pc decline in the final quarter of the year.

Last week, the UK's Civil Aviation Authority said that the number of passengers flying between Heathrow and Dublin slumped 8pc in January to 113,702 compared to the same month last year. Numbers between Stansted and Dublin were down 3pc.

BAA said Heathrow Airport also reported its highest level of retail income last year since intra-EU duty-free shopping was abolished in 1999. Gross retail income at the airport was up 7pc at £351.5m.

Irish Independent

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