UK. London Heathrow Airport has reported cumulative losses of £2.9 billion related to the COVID-19 crisis, as traveller numbers remain low despite some easing of government restrictions.
The airport company today reported six-month results for 2021, with group revenue declining by -51.1% year-on-year to £348 million. There were some positive signals: increasing passenger traffic in Q2 (after non-essential overseas travel resumed on 17 May) led to a +53.8% rise in revenue year-on-year in that period.
Retail revenue fell by -60.7% year-on-year in the half. This was caused by a -75.1% fall in passenger numbers to 3.9 million and the mix of retail service available due to governmental restrictions on non-essential shops in the first five months of the year.
The decrease was partially offset, said Heathrow, “by the application of contractual terms with concessionaires, targeted promotions and a number of non-essential retailers offering a pre-order and collect service”.
Adjusted EBITDA in the half declined to a £33 million loss from £222 million a year ago. Heathrow recorded a £917 million loss after tax, compared to a £998 million loss in first-half 2020.
As reported, Heathrow has urged the government to further ease entry requirements for fully vaccinated travellers from outside the UK.
The company noted: “Fewer than 4 million people travelled through Heathrow in the first six months of 2021, a level that would have taken just 18 days to reach in 2019. Recent changes to the government’s traffic light system are encouraging, but expensive testing requirements and travel restrictions are holding back the UK’s economic recovery and could see Heathrow welcome fewer passengers in 2021 than in 2020.
As reported, Heathrow’s updated traffic forecast is for 21.5 million passengers in 2021, representing a -2.7% decline compared to 2020 but a -73.4% decline versus 2019. Retail income is expected to reach £189 million, a fall of -19.2% compared to 2020, which had the benefit of a strong first two months.
Heathrow CEO John Holland-Kaye said: “The UK is emerging from the worst effects of the health pandemic, but is falling behind its EU rivals in international trade by being slow to remove restrictions. Replacing PCR tests with lateral flow tests and opening up to EU and US vaccinated travellers at the end of July will start to get Britain’s economic recovery off the ground.”
Click here for a recent interview with Heathrow Retail & Property Director Fraser Brown in The Moodie Davitt eZine.
