UK. London Gatwick Airport has said it expects post-COVID-19 passenger numbers to return to recent levels within 36 to 48 months. It outlined its updated action plan as it released its latest results. These cover a nine-month period as Gatwick aligns its reporting cycle with that of Vinci Airports, the airport’s 50.01% shareholder.
The airport company said it has taken action to safeguard the financial resilience of its business with measures including deferring spend on the airport’s capital investment programme for the foreseeable future; putting over 90% of eligible staff on the UK Government’s Job Retention Scheme, and reducing the headcount of permanent staff through a special severance scheme and all staff taking a pay reduction.
To improve its liquidity, Gatwick secured a £300 million loan with a consortium of banks on 3 April. Also, the company will not be paying a dividend in 2020.
Since the end of last year, the airport acknowledged that there has been a “dramatic decline” in passenger numbers due to the impact of COVID-19. The unprecedented market circumstances has led it take a range of steps to protect both the wellbeing of its staff and passengers and “shield the business to enable it to recover quickly”, the airport said.
Resulting changes to the airport’s operational footprint include the temporary consolidation of operations into the South Terminal to between 14.00 and 22.00 each day. The measures came into effect on 1 April 2020 and are being kept under regular review.
The airport said it is is regularly engaging with Government, airlines and other stakeholders to ensure it is in position to rebuild the operation as quickly and as safely as possible, taking into account public health advice.
Gatwick Airport reported growth in both passenger numbers and revenue for the nine-month period ending 31 December 2019, against the same period in 2018. A total of 36.9 million passengers (+0.3%) – driven by long haul passenger traffic (+1.5%) – passed through the airport during this time.
The airport’s EBITDA increased over the period reported by +7.9% to £423.3 million (US$521.6 million) and income per passenger was up by +6% to £19.50 (US$24), including retail income which increased by £7.4 million (US$9.12 million).
Capital investment was slightly up to £174.4 million (US$214.9 million) compared to £173.2 million (US213.4 million) in the nine months to 31 December 2018.
Gatwick Airport Chief Executive Officer Stewart Wingate said: “The airport continued to grow in difficult market conditions during the period covered in these results. However, the world has changed dramatically since then and Gatwick has taken decisive action to ensure that it remains in a strong position to recover from the dramatic fall in passenger numbers and the wider impacts of COVID-19.
“The COVID-19 crisis has been unprecedented and our priority has been, and continues to be, maintaining the health and safety of our passengers and employees. We also have a resilient business and by taking steps to reduce costs, we have protected jobs and expect to recover from this crisis.
“One measure we took to reduce costs was to defer spending on our capital investment programme to secure improved resilience, however for future growth we still expect to progress many of these projects including our plans to bring the existing Northern (stand-by) Runway into routine use to offer more travel choice for passengers and new jobs for Gatwick and the wider region.
“Of course, any growth must be sustainable, and we also remain focused on our ongoing efforts to reduce the airport’s impact on the environment.”
