By March 2021 Teeside airport had liabilities of £27.48m and net assets of £1.8m
Teesside Airport has reported a £13.4m operating loss as the pandemic caused a 90% fall in passenger numbers in the year to March 2021. The airport’s newly published show its turnover for the year fell 38% to £4.8m, down from £7.7m from the year ending March 2020. The number of passengers fell to just 14,521 from 139,448. It incurred £2.73m costs associated with contract termination, including a contact with Close Security Protection. During the year, a total of £20m was drawn down from two loan facilities – a £34.4m facility from Tees Valley Combined Authority and a further £23.6m set up last year to fund development of the airport’s Southside business park. The airport hopes to get thousands more tourists for holiday flights this year, to destinations such as Alicante, Palma, Corfu and Faro. The airport benefited from Government support packages of £886,278 – including £407,439 from the Coronavirus Job Retention Scheme and £478,839 via the Airport and Ground Operations Support Scheme run by the DfT and used to cover business rates during the period. The accounts show that at the end of March 2021 the airport had liabilities of £27.48m and net assets of £1.8m.
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Covid prompts massive fall in passenger numbers at loss-making Teesside International Airport
Newly published accounts for the airport show it incurred £2.73m costs associated with contract termination
birminghampost – Business Live
31.3.2022
Teesside International Airport has reported a £13.4m operating loss as the pandemic caused a massive fall in passenger numbers.
Passenger numbers fell by 90% in the year to the end of March 2021 in what director Phil Forster described as a “devastating” time for the aviation industry.
Turnover for the year fell 38% to £4.8m, down from £7.7m from the previous year (to March 2020) as passenger numbers tumbled to just 14,521 from 139,448.
Accounts for the airport show costs of £2.73m were incurred relating to contract termination.
In July, airport operator Esken – then called Stobart Group – exited its role and transferred its 25% ownership of the airport to a new Teesside Airport Foundation for a nominal consideration.
And in the same month, the airport severed ties with Close Security Protection in a move branded ‘disgraceful and underhand’ by the firm but one that Tees Valley mayor Ben Houchen said would save £100,000 a year.
During the year, a total of £20m was drawn down from two loan facilities – a £34.4m facility from Tees Valley Combined Authority and a further £23.6m set up last year to fund development of the airport’s Southside business park, part of the Teesside Freeport, which will cater for logistics and manufacturing companies across a 3.4million sq ft site.
Writing in a report accompanying the accounts, Mr Forster said his team took the strategic decision not to close the airport, a move he said ensured the support of key businesses on site.
He added: “During this challenging time, we have maintained a strong focus on operational performance, improving the passenger experience and investing in new and upgraded facilities.
“A focus has been to diversify our revenue streams and expand the routes offered for future years. Loganair continue to grow their network from TIA, now serving London Heathrow up to three times daily, with a British Airways codeshare agreement enabling passengers to connect seamlessly to hundreds of BA destinations. In August 2020, a new five-year deal was signed with KLM to continue operating its flights to Amsterdam.
“The seven-year agreement signed with Ryanair commenced this summer with the planned flights to Alicante and Palma. Two new additional routes have already been added and commenced in July 2021 to Corfu and Faro.
“In May 2020, Willis Asset Management Limited, a leading global aviation firm, signed a long-term contract to lease hangar space at TIA as its location for a European aircraft maintenance base. TIA continues to develop other revenue sources to reduce reliance on the passenger-related elements of scheduled and charter flying. These sources include ground-handling and felling to commercial, general aviation and military customers.”
A business plan for the Airport published by Tees Valley Combined Authority in August last year said that prior to the impact of the pandemic, passenger numbers were “highly encouraging” and were exceeding expectations at an early stage of the airport’s 10-year turnaround plan.
That plan forecast revenues to be £30.5m by March 2025 and a return to EBITDA profitability by 2023/24. It also confirmed a target of one million passengers by March 2026.
Progress, it said, would be “driven by a combination of increased revenues derived from both aeronautical and non-aeronautical income streams, new revenue streams and reduced unit costs arising from growth in passenger numbers. “
However, in these latest accounts Mr Forster said passenger confidence was still lower than pre-pandemic levels.
The airport benefited from Government support packages to the tune of £886,278 including £407,439 from the Coronavirus Job Retention Scheme and £478,839 via the Airport and Ground Operations Support Scheme run by the Department for Transport and used to cover business rates during the period.
The accounts show that at the end of March 2021 the airport had liabilities of £27.48m and net assets of £1.8m.
Tees Valley mayor Ben Houchen said: “These figures are from two years ago and relate to 2020/21, when Covid first struck. Airports across the country have made losses and I am confident that Teesside Airport will be back in profit in the next few years.
“The last two years have been unprecedented for the travel and aviation industries with stop-start lockdowns and restrictions making it impossible for both the aviation sector and families to plan with any certainty. This, of course, has a huge impact on airports as highlighted in the recent AOA report, which highlighted revenue losses of £10bn across the UK.”
He said 2022 would be “the airport’s busiest year in almost a decade with a full roster of holiday flights”.
https://www.business-live.co.uk/enterprise/covid-prompts-massive-fall-passenger-23556439
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See earlier:
Teeside Airport bottomless pit for council cash – given another £10 million by TVCA
Teeside Airport is to get an extra £10m from the Tees Valley Combined Authority (TVCA), hoping to keep it afloat after Covid impacts. TVCA spent more than £40m buying the loss-making airport in 2019 following a previous election pledge by Mr Houchen to take it back from previous owner Peel. TVCA has also provided a further £19.4m to support operational expenditure, along with £15m towards capital expenditure, which has helped pay for a multi-million pound terminal redevelopment, new passenger lounges, bars etc. The Local Democracy Reporting Service (LDRS) said in November 2020 that the airport made a £2.6m loss in the previous 12 months. Its advocates say it could be profitable in about 6 years. Teeside Airport Ltd is governed financially by TVCA via another limited company, Goosepool, both being subsidiaries of TVCA, a structure which has been criticised by some for its apparent lack of transparency. Stobart Aviation, which operates Teesside Airport, has a 25% shareholding in Goosepool. Opponents of the handouts to the airport say too much is being spent on the airport and “The time for vanity projects is at an end – it’s time he started to deliver on the real needs of our people.”
Click here to view full story…
New Heathrow flight for Teesside Airport as Loganair to begin service in March
18.1.2021
Agreements have been reached with major airlines allowing passengers to travel on one ticket for onward international journeys. A new route between Teesside International Airport and London Heathrow has been announced. Loganair will initially operate a service twice a day Monday to Friday with a single flight on Sundays from March 8. Weekend services are expected to increase to one morning flight on Saturdays and two on Sundays from March 28. Loganair has also secured partnerships with some of the world’s biggest airlines, including British Airways, KLM, Air France, Emirates, Turkish Airlines, United Airlines and Qatar Airways to provide international travel for people from Teesside, the North East and North Yorkshire.
https://www.gazettelive.co.uk/news/teesside-news/new-heathrow-flight-details-teesside-19642286
Teesside Airport flight subsidy – an unknown amount of public money – divides mayoral contenders
New flights from Teeside airport (used to be called Durham Tees Valley airport) are being subsidised by taxpayers. Tees Valley Combined Authority (TVCA) has contributed funds to support six routes from the airport. The amount has not been released due to “commercial sensitivity” but it was believed in 2018 that there would be subsidies of £1 million over 3 years. Now Tees Valley mayoral candidate Jessie Joe Jacobs said the figure should be made public. She said: “If subsidies are going to flights, are we going to see subsidies for buses for places like Port Clarence, where people cannot get to their local hospital without getting a taxi?” With more awareness of climate breakdown, flying shame and increased rail usage, is helping people to take domestic flights sensible use of scarce public funds? The airport was brought back into public hands at the start of last year for £40m as part of a £588.2m investment plan agreed by Labour council leaders and Tees Valley Mayor Houchen. It is owned in a 75/25 split between the TVCA and Stobart Aviation. Its business plan forecasts losses until 2025 after which it just might make a small profit. But who knows, so far ahead. Voting in the mayoral elections will take place in May.
Click here to view full story…
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