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Fewer people, more money for Manchester Airports Group

But ash cloud closure dents 2011 profits

Written by . Published on August 15th 2011.

Fewer people, more money for Manchester Airports Group

DESPITE a decline in passenger numbers across its four airports, Manchester Airport Group (MAG), has announced a small increase in revenues.

Turnover at the company, which operates Manchester, Bournemouth, Humberside and East Midlands airports, increased from £348.9m in 2010 to £350.2m in 2011, even with passenger numbers declining 4.6 per cent from 23.9m to 22.8m across the group.

Operating profits are down, however, by 8.6 per cent, from £56.1m in 2010 to £51.3m in 2011 - a decline attributed to the six day UK and European airspace closure as a result of the volcanic ash cloud in early 2010. The company estimates operating profits would have grown by three per cent if not for the ash cloud.

In his chairman’s statement in the group’s annual report, Mike Davies said: “The disruption caused by volcanic ash had a direct impact on operating profit of £5.8m and the knock-on effect on reduced travel patterns in the following months had a further impact on income.

“Underlying profit, excluding this effect, would have increased by 1.8 per cent on the prior year.”

Manchester Airport specifically saw passenger numbers fall from 18.3 million in 2010 to 17.7 million in 2011. Revenues from operations at Manchester grew by 0.5 per cent whilst operating profits have shrunk 3.2 per cent from £60m to £58.1m. MAG recently invested in a new executive lounge at the airport as well as installing the first set of security body scanners. During the year the company also completed a refinancing of its bank facilities, worth £355million.

“This gives the group a solid foundation for its current finance needs and provides flexibility and capacity for the foreseeable future,” said Davies.

The company plans to continue its investment plans particularly regarding Airport City and its contribution to the extension of the Metrolink service to the airport. Manchester Airport was also named by the government as one of four primary enterprise zones to benefit from business rate discounts and hopes to submit planning applications for Airport City by the end of this year, with work expected to begin as soon as next year.

“This initiative has great potential to stimulate private sector investment and economic value added in the region, capitalising on the airport’s location, connectivity and available land assets,” said Davies.

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