London’s Heathrow Airport today revealed that is has lost just over £1 billion ($1.30 billion) before tax and adjustments in the first six months of 2020. The news comes as the airport simultaneously revealed that passengers using the airport had fallen by 60% compared to the same period in 2019. In more positive news, the airport is starting to show signs of recovery.
None of the aviation industry is expected to release positive results for much of this year, given the current situation. Indeed, we’ve seen a flurry of negative results of late. For example, on Monday, Ryanair revealed a €185 million ($217 million) loss for its first quarter. Meanwhile, today ANA announced a $1 billion loss for the same quarter.
Heathrow loses £1 billion
Today, it was Heathrow Airport’s turn to reveal its latest financial results. However, unlike most who have published quarterly results, the airport opted to release first-half results. The airport saw its revenue fall by half from £1.46 billion ($1.89 billion) in 2019, to £712 million ($923 million) in 2020.
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However, the real difference is in the airport’s profit/loss figure before tax and adjustments. In 2019, this stood at £7 million ($9 million) of profit. However, from January to June of 2020, this became a loss of £1.059 billion ($1.373 billion).
The loss isn’t the end of the world for the British airport, which reported that it has a large enough cash reserve to survive until June 2021 with no revenue at all. Commenting on the results, Heathrow CEO John Holland-Kaye said,
“Today’s results should serve as a clarion call for the Government – the UK needs a passenger testing regime and fast. Without it, Britain is just playing a game of quarantine roulette. As many of our customers have experienced, it’s difficult to plan a holiday that way, let alone run a business.”
Passenger figures are slowly recovering
Passengers are slowly starting to return to London’s busiest airport, the keyword here being slowly. April was the worst month for Heathrow Airport and many other airports and airlines around the world. That month the airport handled just 206,324 passengers, around 6,900 per day. This figure climbed slightly to 227,230 in May. The airport realized a marginally higher growth in June as passengers reached 350,283, about 11,700 passengers per day.
As passengers slowly start to return to Heathrow Airport, we have seen some shuffling of airlines between terminals. At the height of the crisis, British Airways and Iberia were flying from Terminal 5, while all other airlines were flying out of Terminal 2. However, as services ramp up, American Airlines, Qatar Airways, and Japan Airlines have moved across to Terminal 5, with China Southern and Finnair to follow.
Slower recovery than elsewhere
While Heathrow Airport’s passenger figures are showing the positive signs of recovery, it is recovering slower than its European counterpart Frankfurt. In April, at the height of the crisis, Frankfurt’s passenger numbers had fallen to 188,078.
In June, Frankfurt had handled 599,314 passengers, an increase of 219%. As pointed out, Heathrow’s passenger count only climbed to 350,283, in other words, an increase of just 69%. Before the crisis, Heathrow was one of the busiest airports in the world. However, arrivals to the United Kingdom were placed under mandatory 14-day quarantine for much of June, stunting the industry’s recovery significantly, as passengers were then put off of flying.
What do you make of Heathrow’s H1 results? Let us know your thoughts in the comments!