Stansted hits new heights and sets bidders a fresh challenge
Huge revenue growth at Stansted Airport and across owner BAA’s operations nationally have raised the bar for potential bidders.Huge revenue growth at Stansted Airport and across owner BAA’s operations nationally have raised the bar for potential bidders.
With Spanish group Ferrovial and Goldman Sachs said to be preparing renewed offers valuing BAA at around £10 billion, the financials issued by BAA for the year to end-March handed shareholders solid reason not to cave in.
The Stansted figures are particular buoyant:-
• Passenger numbers up 5 per cent to 22.2m
• Revenues up 9.9 per cent to £167m
• Operating profit up 19.5 per cent to £49m
• Charges levied to airlines up 16.1 per cent to £72m
• Cargo business 4.6 per cent ahead to 239,120 metric tonnes
With Stansted intent on ending its discounts to airlines from April 2007, the revenue generating capacity of the Essex hub is set to take off to a new plateau.
New routes are also coming on boards fast, notably throughout Europe but also further afield.
And with China set to build 48 new airports in the next five years, Stansted’s advanced talks on bringing direct services between Chinese trade centres and the East of England is edging ever nearer.
BAA as a group also boosted UK passenger traffic 2 per cent to 144.6m over the year and revenues 7.4 per cent to £2.232 billion.
Mike Clasper, BAA’s CEO said: “We have again converted passenger growth into stronger underlying operating profit. These results are a reminder of BAA’s core strengths that enable us to consistently generate shareholder value.
“Looking forward, this year we are forecasting a 3.5 per cent rise in passenger numbers and I am confident we will convert this growth into another good financial performance.”
Time is running out for potential bidders to submit fresh offers that meet BAA management expectations .
Now the UK regulator, the Civil Aviation Authority, is publicly expressing concern about the ability of a debt-ridden acquirer to build a second runway at Stansted and deliver other improvements critical to the Government’s strategy of meeting rocketing UK demand for air travel.