Fall in passenger numbers for Humberside Airport owner

HUMBERSIDE Airport, part of Manchester Airports Group, made an operating loss of £700,000 on revenues of £6.6m over its last financial year. 

Across the group, MAG suffered from another fall in passenger numbers in the year to March 31, but by maximising spending from passengers revenues rose 0.4% to £350.2m.

Humberside’s operating loss was flat on the previous year, while revenues dipped by £200,000.

MAG said Humberside Airport would continue to look to take advantage of green energy proposals on the Humber, expecially wind power, and that the KLM service flying out of Humberside was one of the strongest in its stable. 

Passenger numbers across the group fell for the second year in succession – from 27.3m in 2009 to 22.8m this year

However, group finance director Neil Thompson said that the UK aviation sector had experienced a “challenging year”, due to the general economic gloom, the 2010 ash cloud, which shut UK airspace for six days, and an unusually cold December which kept passengers away.

“Against that backdrop, we feel we’ve done pretty well,” he said. “When you take out the impact from the ash cloud, our underlying profit is up by 2%.”

The group’s operating profits before significant items fell by 3% to £51.3m (2010: £56.1m), but it argued that the ash cloud cost the group around £5.3m in lost profit.

Statutory pre-tax profits increased to £80.6m due to a one-off £42.6m gain as a result of the way it calculates inflation on its pension liabilities.

Mr Thompson, who has been with the airport for six years but only became group finance director in March, said the increase in revenue had been achieved by tailoring its offer more closely to its customers.

For instance, he said the airport had dispelled the “myth” of high parking charges by introducing a week-long parking scheme for £29.99 if booked sufficiently in advance, but had also offered a higher-end valet parking service for those willing to pay for it.

Similarly, he said surveys of passengers to gauge the type of shops they wanted to see prior to a major overhaul of space at Manchester Airport’s Terminal One last year has made a positive contribution, with retail income per passenger up 6.2%. 

This will continue to rise as passenger numbers turn positive again, argues Mr Thompson, with numbers currently up by around 3.5% on last year.

“That’s above the the rest of the sector, and we are trying to beat the market this year,” he said. “We’ve really engaged with the low-cost carriers like easyJet, Jet2.com and Ryanair.”

Manchester Airports Group comprises Manchester, East Midlands, Bournemouth and Humberside airports – the latter two of which made a loss during the year.

It employs around 2,600 people. Its property arm, MAG Developments, saw the value of its portfolio increase by £13m during the year, which helped to boost the group’s net assets by £47.9m to £817m.

Net debt increased by £25.3m to £372.9m, but the group refinanced £355m of bank debt during the year, giving it what chairman Mike Davies described as “a solid foundation for its current finance needs and provides flexibility and capacity for the foreseeable future.”

The group has been linked for some time with a potential bid for either Glasgow or Edinburgh airport, as Spanish-owned rival BAA has been told to sell off one by the Competition Commission. However, Mr Thompson said that the Competition Commission’s battle has already been subject to a two-year dispute.