BAA said it had delivered a strong operational year with continued significant investment that would ultimately see it turn a profit, although interest payments on its £10bn debt continued to drag its annual accounts into the red.
Colin Matthews, chief executive of BAA, stressed a continuing improvement in customer satisfaction. He said: “Passengers say Heathrow is getting better. Our punctuality is the best in a decade, passenger ratings are up in total, and particularly for transfers and on security waiting time.
“And we had more passengers, who spent more freely in our retail and car parks.”
He said BAA had made almost £900m of investment in Heathrow over the year, mainly in the building of Terminal 2, which will handle 20 million passengers a year after it opens in 2014.
At BAA’s second London airport, Stansted, passenger numbers continued to fall even on the disappointing 2010 figures, down to 18.0 million from 18.6 million.
Rising interest payments on BAA’s debts turned the operating profit of £572m into a pre-tax loss of £256m – a £60m improvement on its 2010 losses. The interest bill rose from £696m to £790m last year. Matthews insisted: “BAA will make a profit. Predicting exactly when is difficult – but it will make a profit. The investors have always been there for the long term.
“It was a good year for improving passenger experience, which we have to do for people to see clearly: now people can see that the capital investment we’re making to transform the facility will make it a better airport, and a good investment.”
Heathrow operated at virtually full capacity last year, with 69.4 million passengers. BAA’s revenues were up 9.9%, reflecting higher landing charges and retail income.
BAA raised £3bn in new financing last year and said it would pay dividends to its ultimate shareholders in 2012 for the first time since the Ferrovial-led consortium bought the operator in 2006.
BAA calls for Heathrow third runway to be reconsidered
Airports boss Colin Matthews has urged the Coalition to put a third runway at Heathrow back on the negotiating table as the Government prepares to investigate how to solve Britain’s worsening airports “capacity crunch”.
By Nathalie Thomas (Telegraph)
22 Feb 2012
Mr Matthews, who as chief executive of BAA oversees six UK airports including Heathrow, said it was far too early to rule out any single option as ministers prepare to publish an aviation paper on capacity problems next month.
He used the publication of BAA’s 2011 results today to repeat his case for increased capacity at Heathrow, warning that Britain is already losing out on lucrative business from the Far East to European rivals.
BAA narrowed its losses in 2011, helped by record passenger numbers at Heathrow.
However, Mr Matthews warned that the prized London asset was already operating at full capacity.
He said: “None of the solutions to the hub capacity issue are simple and there are several on the table.
“I think the Government should look at all of the options coolly and calmly and decide which one is best. I see no good reason for ruling out any in advance.”
The Coalition dismissed the possibility of a third Heathrow runway last year but next month’s paper is expected to include the option of building a new airport in the Thames Estuary.
Mr Matthews warned this was more of a “long-term” plan and called for more urgent solutions.
“It’s today when airlines are coming to us and saying we want to fly to London and we say: ‘Only if you can buy a slot from another airline can you fit into Heathrow.’ That’s damaging to the UK.”
BAA, which is 50pc owned by Spanish infrastructure group Ferrovial, saw pre-tax losses ease to £255.8m in 2011 from £316.6m the previous year as passenger figures across its six UK airports grew 3.7pc to 87.4m.
Revenue was up almost 10pc to £2.28bn.
Mr Matthews said about 1.9pc of that improvement was underlying growth as Heathrow was helped last year by fewer incidents of adverse weather and industrial action.
The group, which is being forced to sell off both Stansted and Edinburgh airports, said it raised £3bn in fresh finance last year and spent £950m – the majority of it on a £2bn upgrade of Heathrow Terminal 2.
BAA is still “considering its position” on Stansted after losing an appeal earlier this month.
22 February 2012 (BBC)
BAA says Heathrow passenger numbers reach record
The number of passengers using BAA’s Heathrow airport rose 5% to reach a record 69.4 million last year while losses for the company narrowed.
BAA made a loss of £255.8m in the year to 31 December, after losing £316.6m the year before.
Passengers at its Stansted airport, however, fell by 2.8% to 18 million.
BAA owns a number of airports in the UK, including Edinburgh and Glasgow, although it is selling Edinburgh after a Competition Commission ruling.
It has also been ordered to sell Stansted, a ruling it has contested but so far has been unable to overturn.
BAA said it was considering its next move.
The company, 49.9% of which is owned by the Spanish infrastructure group Ferrovial, said the total number of passengers at its airports rose 3.7% to 87.4 million.
“Growth [at Heathrow] was particularly strong, with countries such as the US, Germany, Switzerland, France and Brazil,” BAA said.
“Of Heathrow’s major markets, European traffic showed the most significant year-on-year growth, increasing 7.6% to 28.5 million passengers.”
Heathrow operates at almost full capacity and BAA said the airport used a record 99.2% of its maximum permitted annual arrivals and departures last year.
BAA said this meant it was unable to keep up with demand for new routes to growing markets in places in Asia, such as Manila, Shenzhen and Jakarta.