Manchester Airports Group issues reassurance on financial stability

Manchester Airport

Manchester Airports Group (MAG) said it has the financial wherewithall to see out the current downturn in international travel.

Last night (March 16) the group, which includes Manchester Airport, East Midlands Airport and Stansted Airport handling a total of 62 million passengers, said it was introducing annual leave, cutting working hours and introducing temporary pay cuts and lay-offs in response to the coronavirus crisis.

In a market update to the stock exchange this morning (March 17), it issued reassurance on its financial stability, saying: “The implications of COVID-19 on the aviation industry are unprecedented.

“However, MAG faces this situation with a strong underlying financial position, including low leverage, £395m of available debt liquidity undrawn and no debt refinancings due until 2023.

“MAG, together with its shareholders, IFM Investors and The councils of Greater Manchester, will continue to monitor the situation as it evolves and to update MAG’s strategic response as necessary.”

Chief executive Charlie Cornish added: “The COVID-19 outbreak has led to a rapid and unprecedented reduction in demand for air travel in and out of the UK, and MAG airports are seeing much lower passenger numbers as a result.

“We expect demand to return as the COVID-19 peak passes, but this temporary and dramatic downturn requires us to act now to protect our position at this critical time.

“We will continue to monitor the situation and make further announcements on MAG’s operations as the COVID-19 situation develops.”

Karen Dee, the chief executive of the Airport Operators Association, said: “Governments across the world are supporting their national aviation industries, as many parts of the global travel industry have come to a halt.

“As some airlines call on the UK Government to act similarly, we are clear that airports will shut down in weeks unless urgent action is taken to support the industry.

 “The UK’s airports are critical national infrastructure, fulfilling a vital public service, and are on the frontline of the COVID-19 outbreak. It is essential that airport businesses remain operating and are able to weather this storm, so that they can provide the connectivity which drives growth, employment and prosperity after the crisis has abated.

“The Government must step in to see airports across the four home nations through the current crisis, and make an unequivocal commitment to doing whatever it takes to sustain the UK aviation industry.”

Joss Croft,  chief executive of trade body of UKinbound said: “These are desperate and unprecedented times and the only way of ensuring the survival of our vital industry, that employs one in 12 people across all parts of the UK, now is with Government support.

“The UK’s tourism and hospitality industry simply has no revenue stream or working capital with which to sustain itself, and so we hope that the chancellor’s announcement today about further financial support for the economy will include our sector.

“Additionally, any support packages must be rolled out and available immediately with absolutely clear guidance; tourism businesses have days, not weeks, in which to survive.”

Responding to the Chancellor’s announcements late yesterday afternoon (March 17) to support businesses through the COVID-19 pandemic, Karen Dee added this: “The Chancellor’s unambiguous statement of support for UK businesses is welcome and measures such as the unlimited loans to support businesses manage cashflows provide reassurance.

“However, with passenger numbers declining rapidly in recent days, airports want to hear the details of the specific support package for the aviation industry as soon as possible. We urge the Chancellor to be as bold in this aviation support package as he was on some of the measures announced today to ensure airports can reassure staff and passengers that they will be there to provide the connectivity the UK needs after the COVID-19 pandemic has receded.”

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