Heathrow 2.5% rise in pax in 1st half of 2018, 5% rise in retail, 7% more on car parking cf. 2017
Though Heathrow always says it is almost full, in reality it has terminal capacity for many more. Its latest half year results, to the end of June, show the number of passengers increased by 2.5% to 38.1 million (half year). There are more larger planes, and the load factors are higher, now up 1% to 76.9% on average. Revenues for the 6 months were up 2.3% to £1.4 billion. Retail profits were up 5% to £206 million, far outstripping many high streets. Income from bars, restaurants and cafés was up by 11.5%. While trying to persuade politicians etc that it is not going to worsen already very bad air pollution with a new runway, Heathrow made 7% more from car parking in this first half, at £62 million. Car parking is very lucrative to the airport, while passengers arriving by public transport are not. Income from the Heathrow Express (owned by Heathrow) rail link (very expensive) from Paddington, fell by £2 million to £61 million. Spending more on security and the “passenger experience” cut pre-tax profits from £102 million to £95 million now. The payroll bill rose by nearly 2% to £183 million; operational & maintenance costs rose by nearly 9% to £223 million.
Lots of details from Heathrow at
In the first half of the year, the number of passengers passing through the west London hub — Europe’s largest — rose by 2.5 per cent to 38.1 million. That helped to send revenues for the six months up 2.3 per cent to £1.4 billion.
While the number of aircraft movements for which the airport can charge airlines is rising only marginally, aircraft are becoming larger and are flying fuller, with load factors up more than a percentage point to 76.9 per cent.
That change has provided growth in the number of passengers, who appear to be unconcerned about loosening their wallets in the airport’s shopping plazas. Income from retail rose by 5 per cent to £206 million, far outstripping the moribund shopping performance on the high street. Income from bars, restaurants and café was up by 11.5 per cent.
While the key to Heathrow reversing its poor environmental impact is to encourage fewer private cars arriving at the airport, charges from car parking came in 7 per cent higher at £62 million.
Conversely, income from the Heathrow Express rail connection with London Paddington — the most expensive per mile overland rail journey in the country at £25 for the 15-minute, 12-mile trip — fell by £2 million to £61 million.
The higher costs of handling more passengers and increased investment in security and what Heathrow calls the “passenger experience” took pre-tax profits down from £102 million in the first half of 2017 to £95 million this time.
The payroll bill rose by nearly 2 per cent to £183 million, while operational and maintenance costs leapt by nearly 9 per cent to £223 million.
The airport is 25 per cent-owned by Ferrovial, the Spanish construction company, while 20 per cent is in the hands of the sovereign wealth fund of Qatar, which is also a leading shareholder in IAG, the owner of British Airways, which accounts for about half of Heathrow’s flights. China’s sovereign wealth fund holds another 10 per cent.
In an update on its third runway planning, the airport said: “In June, an overwhelming political mandate in parliament propelled Heathrow’s expansion project forward.
“Heathrow is now reviewing over 100 fresh ideas from UK businesses and entrepreneurs to help deliver the project more innovatively, sustainably and affordably. This is in addition to finalising visits to 65 UK sites bidding to help build the project through large-scale offsite manufacturing.”
European short-haul and UK domestic passenger numbers grew by 2.6 per cent and intercontinental traffic rose by 2.5 per cent. In long-haul, the better growth has been in traditionally underserved routes to Africa and Latin America. Passenger numbers to and from Africa rose by 100,000 to 1.6 million. ,
Passenger totals to Latin America increased by 6 per cent to 700,000, after the launch of BA services to Chile. Latin America is reckoned to have been poorly served by Heathrow in the past as IAG tends to serve the region from Spain via Iberia, BA’s sister airline.