By Anthony O. Goriainoff
London’s Heathrow airport said Monday that its first half pretax loss narrowed and that due to the U.K. government’s travel restrictions stemming from the pandemic, the airport could see less passengers in 2021 than it did in 2020.
The airport, which is jointly owned by the Qatar Investment Authority, China Investment Corp., Spain’s Ferrovial SA and other investment companies, said that less than 4 million passengers traveled through the airport in the period, and that this was a level it would have taken 18 days to achieve in 2019. It added that the U.K. was falling behind its EU rivals in international trade due to the government being slow to remove restrictions.
“Recent changes to the government’s traffic light system are encouraging, but expensive testing requirements and travel restrictions are holding back the U.K.’s economic recovery and could see Heathrow welcome fewer passengers in 2021 than in 2020,” the airport said.
Heathrow said that for the six months ended June 30, pretax loss was 868 million pounds ($1.19 billion) compared with a loss of GBP1.06 billion for the first half of 2020.
Revenue for the period fell 51% to GBP348 million, the company said.
The airport said that its prudent financing action has given a 49% increase in liquidity to GBP4.8 billion since the start of the pandemic, and that this provides it with sufficient cover to meet all commitments until October 2022 in an extreme no-revenue scenario.
“With continued travel restrictions causing some uncertainty over passenger numbers, we have taken the prudent step to seek creditor approval to waive the Heathrow Finance interest cover ratio covenant for 2021,” it said.
Write to Anthony O. Goriainoff at [email protected]