Airport expects more turbulence after drop in profits
Birmingham Airport expects another “challenging year” after profits fell 10% last year.
The airport has seen passenger numbers fall in the wake of Monarch’s collapse last autumn, which contributed to a difficult second half of its financial year.
Profits in the year to March were down £3.6m to £34.5m despite turnover increasing by nearly £10m to £155.5m.
Passenger numbers last summer reached record levels, with August 2017 the busiest month in the airport’s history. However Monarch, which was the airport’s third-largest carrier, went into administration in October and the loss of Norwegian Airlines, United Airlines and Icelandair also reduced activity.
Although Jet2, Thomas Cook and TUI have helped to “partially mitigate” the loss of Monarch, the airport has faced further problems this summer with Primera Air suspending its operations from Birmingham.
Birmingham Airport said “2018/19 is set to be another challenging year as the Airport continues to recover lost traffic and deliver future growth following the demise of Monarch Airlines.
Birmingham Airport’s monthly passenger figures had shown like-for-like growth for more than three years until November 2017:
An exceptional charge of £1.8m arose from “changes to the airport’s executive team, an update of the Airport’s master plan and the demolition of an obsolete building”.
£1.15m was paid for restructuring costs, of which £426,000 was compensation paid to directors for loss of office.
Departures during the year included chief executive Paul Kehoe, who left in July 2017 after nine years in charge and is yet to be permanently replaced, and chairman John Hudson, who stepped down at the same time.
Dividends for the year increased 8% to £30.3m. This resulted in seven councils – Birmingham, Coventry, Dudley, Sandwell, Solihull, Walsall and Wolverhampton – which collectively own 49% of the airport, sharing £16.1m. Airport Group Investments, a company owned by Ontario Teachers’ Pension Plan and Victorian Funds Management, holds 48.25% while employees have a 2.75% stake.
