Manchester Airports Group shows strong recovery after pandemic restrictions lifted
Manchester Airports Group has made a strong recovery since the lifting of pandemic restrictions, new figures for the six months to September 30, 2022, showed today.
Parent group, Manchester Airport Group Investments Limited, revealed a 238.1% increase in interim revenues, of £537.6m, and drastically reduced pre-tax losses, which came down from £105.2m at this time last year, to £28.2m.
Operating profit for the six months was £22.1m, against a loss of £75.1m previously. This result was heavily impacted by a one-off adjusted item charge of £119.7m following the extinguishment of the group’s deferred debt agreement (DDA) for the exit from the Greater Manchester Pension Fund (GMPF) pension scheme.
The GMPF settlement also gave rise to a £116.7m increase in reserves and, therefore, an overall net movement of £3m.
MAGIL’s parent, MAHL, reported an adjusted EBITDA of £261m, and a profit from operations of £22.8m.
The recovery in international travel was shown in a huge increase in passenger numbers for the period. Total throughput was 30.5 million passengers, compared with 6.6 million a year ago.
At Manchester Airport, passenger numbers handled were 14.3 million, up from 2.7 million previously. London Stansted handled 14 million passengers, a 300% increase on the 3.5 million levels a year ago, while East Midlands Airport processed 2.2 million passengers, compared with 400,000 last year.
The surge of international travellers led to severe delays at the group, particularly Manchester Airport, as it tried to recruit sufficient security staff.
The group said: “The fact that the aviation sector knew that this demand would come back did not make it easier to prepare for, given the difficult labour market and that it can typically take up to three months to train and vet new aviation recruits before they can start work.
“It is important to acknowledge that service levels in some parts of MAGIL’s business were, at times, not where we expect them to be. This was particularly true in the early months of the summer and applied both to the operations in MAGIL’s direct control and those delivered by our partners, such as airlines, ground handling companies and those that deliver assisted travel services.
“With much of MAGIL’s operational difficulties relating to recruitment challenges, we are pleased now to be in a position where more than 2,000 new colleagues have started work with us, which underlines how important our airports are to the communities surrounding them in relation to employment.”
On May 27, MAGIL completed a refinancing of its £500m revolving credit facility and a £90m liquidity facility, which were scheduled to mature in June 2023.
The total facility sizes and lenders remained unchanged. The new facilities mature in May 2027, with options to extend by up to two years, subject to lenders’ agreement. Subsequent to the period end, on October 31, 2022 the revolving credit facility, which had remained fully drawn since March 2020, was repaid in full.
MAGIL’s £1.460bn of listed bonds, together with the bank facilities described above and retained cash resources of £613.5m as at September 30, 2022, provide it with a long term stable funding platform.
MAGIL’s total net debt, excluding IFRS 16, was £1.333.7bn at September 30, 2022, which was £379.6m lower than as at March 31, 2020, at the beginning of the pandemic.