Airport operator posts loss for first quarter after incurring costs over Heathrow's T5 opening
BAA has posted a loss for the first quarter of the year, blaming increased maintenance and security costs leading up to the opening of Terminal 5.
The airports operator revealed pre-tax losses were £62m in the three months until 31 March 2008, down from £89m in profits during the same period last year. Revenue rose slightly to £506m, up 9% from last year’s figure of £465m.
BAA spent £24m in “operational readiness costs” for the opening of Heathrow Terminal 5 in the three months to the end of March, compared to just £2m the year before. This included fit-out, testing and co-ordination costs.
Maintenance costs across the group rose 48% to £51m, up from £35m during the same period last year.
The 169% drop in profits was also due to a loss of £97m on the revaluation of BAA’s investment properties – down from a £2m increment last year.
Colin Matthews, BAA’s chief executive, said: “Our operating profit was clearly affected by higher security and maintenance costs, reflecting the importance we place on delivering a safe and convenient service to passengers through higher standards and better facilities.”
BAA’s net debt level during the period rose to £7.4bn, up from £6.9bn the year before. The level of its losses is unlikely to please shareholders, who pumped £400m back into the company earlier this month.