Rising numbers of flights to sunshine destinations gave Newcastle International Airport a lift in 2019, despite the collapse of holiday operator Thomas Cook, accounts have revealed.
The business leading the North East airport – NIAL Group Limited – has published accounts for 2019 which show revenues rose 2%, from £69.5m posted in 2018 to £70.8m.
Ebitda came in at £41.8m compared to the previous year’s £40.8m, while operating profit also rose, by 2%, from £29.9m to £30.5m.
However, passenger volumes were down, with 5.25 million passing through the transport hub compared to the 5.39 million it welcomed through its doors the previous year.
It said the drop in passenger volumes was predominantly driven by the loss of charter capacity, which dropped by 15%.
Low-cost international traffic grew by 2% year-on-year, thanks to an increased flying programme to Turkey and other sunshine destinations over the summer, and low-cost domestic passenger numbers also grew, by 1%, mainly due to increased traffic to Bristol.
Scheduled domestic passages fell by 5%, reflecting the reduced weekly movements to London Heathrow.
The firm said the falling passenger numbers were the result of a challenging year for the airline sector, which endured aircraft shortages as well as the collapse of holiday firm Thomas Cook – although those coming through the airport were spending more, which ultimately helped to lift the overall revenue figure.
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In a report accompanying the accounts by financial director Mark Hunt, the airport said its business income grew from commercial activities including airport shops and catering facilities in the terminal, which are concessioned to third-party operators, as well as car parking.
It also highlights the £13.1m spent on investments across the airport, including work to boost to customer parking facilities.
Work had also started on the creation of a new, luxury business lounge. The airport plans to create a new lounge with a bar area, top quality food, views of the runaway, new desk spaces, charging ports and super-fast WiFi - but work on the lounge had to be paused at the start of the pandemic.
The report added: “During 2019 the airport continued to invest in its facilities and infrastructure.
“Work to enhance the customer parking facilities concluded during the year, offering an improved product range and customer experience. Renewal of the taxiway pavements and airfield ground lighting commenced in late 2019.”
The financial year covered in the report doesn’t include the impacts of Covid-19 – which will also include the loss of the easyJet base at Newcastle as well as most of the airline operator’s overseas flights – as this will be covered when accounts for 2020 are filed at the end of this year.
The report accompanying accounts for subsidiary Newcastle Airport Local Authority Holding Company Ltd, mentions how measures taken to stop the spread of infection resulted in travel restrictions and widespread grounding flights, but says its long term view is a positive one, adding: “While the full financial impact is unknown at this point, performance in 2020 will be significantly affected by the pandemic. Since the national lockdown during April and May commercial flying has resumed at a modest level and the long-term outlook for the business remains positive.”
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The 2019 accounts, meanwhile, include the full year impact of the Thomas Cook collapse, which it said it weathered thanks to having a mix of airline partners.
In the accounts the airport said: “Despite facing the full-year impact in 2020 of the Thomas Cook collapse the airport continues to benefit from a wide route network operated by a good mix of airline partners and the outlook for the business remains positive.”
Following the publication of the accounts, Mark Hunt, chief financial officer, said: “ In the 2019 financial year the business performed well, turnover increased by 2% and profit before tax by 5% compared to 2018.
"As a result we were able to continue to invest in facilities and infrastructure to improve the passenger experience. "2019 saw the opening of a brand new Premium Meet & Greet car parking facility and new departure lounge restaurants, the installation of a sensory area and the development of the Visit North East England website.
"The airport was once again awarded for its high level of customer service - being named the Best Airport by Size and Region at the 2019 ACI Airport Service Quality Awards.
"There is no doubt that 2020 was a far more challenging year for the aviation industry, with the Covid-19 pandemic significantly impacting passenger numbers across the globe.
"Newcastle remains a strong regional airport, however, we expect it to be a number of years before passenger numbers recover to pre-crisis levels.”