Budget airlines will drive MAG growth says Cornish
GROWTH in revenue, profit and passenger numbers at Manchester Airports Group will be driven by developing more routes with the likes of easyJet, Jet2 and Ryanair, according to new chief executive Charlie Cornish.
Speaking to TheBusinessDesk.com, four months into his role, he said: “If you look at who is ordering aircraft it’s budget airlines and airlines in the Middle East and Asia Pacific regions.
“We have just brought Ryanair back to Manchester and we would expect to see a lot of growth coming from that sector, there’s a lot of opportunities.
“If you look at Ryanair, anywhere they go they grow and grow passenger numbers so it’s important for us to get the low cost airlines in to Manchester. I don’t think it’s going to erode charter volumes – there’s more than enough to go at for them.”
He said the scale of the opportunity for MAG was demonstrated by the fact that around 10% of its revenues come from low cost airlines, while at Stansted it accounts for 75%.
The company handled about 22.8 million passengers last year, and is aiming to boost this figure by 2% to 4% this year.
In the wake of reports last week that Heathrow owner BAA will have to sell off one of its regional airports on competition grounds, Mr Cornish, who joined MAG from United Utilities four months ago, also said the group would be interested.
“If BAA are potentially going to sell Stansted, Edinburgh or Glasgow and if we can demonstrate that it would add value for our shareholders, we would have a look.”
Owned by the 10 councils of Greater Manchester, with Manchester City Council controlling 55% and the other nine authorities 5% each, MAG owns East Midlands, Bournemouth and Humberside as well as Manchester Airport.
Mr Cornish said he was happy with MAG’s ownership structure, and did not feel that it would impede his ability to pull off a big deal.
“They are the same as any institutional shareholder – they are interested in the value of the group and the dividend. I think the fact that they are supportive is evidenced by the £1.5bn bid for Gatwick last year.”
He said he is excited by Airport City – an ambitious development project across 60-acres on land around the airport, which includes retail, leisure, conferencing, hotels, offices and commercial developments.
First announced in 2009, Airport City is one of 16 schemes put forward by AGMA, the Association of Greater Manchester Authorities for funding from the Government’s Regional Growth Fund.
“Airport City is a huge opportunity for Manchester”, he said.
The Scot, who described Manchester as “unquestionably the UK’s second city” said the scale of the opportunity to grow MAG had attracted him to the role.
“There were options for me in London and in the US too, but this role ticked all the boxes for me, predominantly because of the potential for the business.”
Asked about the current trading environment, he said: “Consumer confidence isn’t as good as you’d like, but it’s holding up. We are expecting to see growth this year and an improved picture next year.”
