MAG half-years boosted by Stansted swoop
MANCHESTER Airports Group has reported strong growth in half year earnings and says it has begun a turnaround at Stansted Airport, which saw passenger numbers fall for five years under previous ownership.
MAG said its investment programme and long-term deals with airlines such as Ryanair, easyJet and Thomas Cook, were reversing Stansted’s fortunes. Year to date passenger numbers are up just under 2%.
After last year’s £1.5bn acquisition of Stansted, MAG, which is owned by the 10 Greater Manchester Authorities (64.5%) and Australian infrastructure fund IFM Investors, is the UK’s largest airport operator, owning East Midlands and Bournemouth as well as Manchester and Stansted with a 26.7% market share.
In the six months to the end of September MAG saw the benefit of its record deal as passenger numbers rose 73.8% to 25.9 million. Growth on a like-for-like basis was 6%.
Revenue was up nearly 70% to £390m from £229.8m in the previous year. Within this number 9.5% represented like-for-like growth, while 60.2% was from the Essex airport.
Reflecting a similar growth trend, EBITDA was up 16.7% to £109m excluding the acquisition, and ahead 80.2% to £168.3m when Stansted is included.
Operating profit before significant items rose from £60.8m to £76.7m (+26.2%). Including Stansted growth was 78% to £108.2m.
MAG chief financial officer Neil Thompson said the group was very pleased with the results which represented a “really strong trading performance against a tough economic backdrop.”
He said: “We are out-performing our financial targets and in line with our growth in market share, we continue to outperform the UK market in passenger numbers.
“We have secured long-term agreements with leading airlines and retailers, creating a strong future for our group. With a number of significant projects underway at present, I am confident that the next six months will be as exciting and rewarding as the last.”
He said progress is being made to secure direct flights from Manchester to new destinations including Beijing, Mumbai and Hong Kong, though said they are “medium-term aspirations”.
The company said passenger numbers across all airports are outperforming the UK market, in particular at Manchester Airport where the 20 million passenger target was reached during the summer and at East Midlands Airport, where the airport experienced a return to pre-recession passengers numbers during the summer.
Mr Thompson said the long term growth deals with Ryanair and easyJet would add eight million passengers at Stansted over the next five years.
MAG said significant investment in both retail and car parking had provided strong income streams. The retail division was 3.4% up due to the new shopping and catering options available at Manchester and East Midlands Airport.
Car parking revenue was significantly higher (13.9%), after substantial investment across all airports to create more on-site secure car parking, including 4,000 extra spaces at Manchester.
After the half-year end, MAG took a major step forward in its plans for the £800m Airport City development as it secured Beijing Construction Engineering Group (BCEG), Carillion and the Greater Manchester Pension Fund as joint venture partners alongside Argent as development manager.
