Strong nine-month retail performance buoys Heathrow Airport

UK. London Heathrow Airport today reported a robust set of results for the nine months to 30 September, with retail revenue increasing by +8.5% year-on-year to £449 million. Retail revenue per passenger climbed by a healthy +7.7% to £7.83.

The company said that retailing was buoyed by the redevelopment of stores in Terminal 5 including a range of new brands.

It noted: “Performance in duty and tax free stores has continued to improve following extensive store refurbishment in Terminals 4 and 5.” Duty and tax free revenues hit £99 million in the period, up by +6.5%. Airside specialist shops grew revenue by +10.7% to £83 million.

Heathrow Airport said: “Growth in retail income accelerated in the third quarter, particularly in areas such as duty and tax free and airside specialist shops, driven particularly by the depreciation of Sterling following the EU referendum in late June.”

Heathrow Airport: Robust retail results in first nine months was buoyed by a strong performance in T5, where British Airways is the airline tenant

Catering (F&B) income rose by +5.9% to £36 million in the nine months.

Car parking also performed well (+8.7%), with Heathrow citing continued take-up of its “expanded car parking product range and successful yield management”.

In related developments, the airport said that T4 is now refreshing its retail proposition. “The restaurant and bar group, Drake & Morgan opened The Commission, their first airport unit. Terminal 4’s luxury stores, such as Harrods, Burberry and Cartier, are also being redeveloped and five new luxury brands will be introduced, two of which will be new to Heathrow. The luxury retail redevelopment in Terminal 5 has now been matched by the introduction of an enhanced food and beverage offer.”
For the nine months ended 30 September, traffic grew by +0.7% to 57.3 million. Long haul traffic increased +1.7%, principally from routes serving the Middle East and Asia Pacific regions.

Total revenue rose by +1.2% to £2,093 million and Adjusted EBITDA was up +4.4% to £1,274 million reflecting lower costs, said the company.

Adjusted pre-tax profit climbed by +11% to £202 million in the period.


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