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Heathrow confirms “devastating impact of COVID-19”, but hopeful for better 2021


London Heathrow today revealed that the airport lost £2 billion in 2020 as its passenger numbers slumped from 80.9 million in 2019 to just 22.1 million last year.

It notes that the “devastating impact of COVID-19” led to its overall revenue plummeting 62% to £1.2 billion and adjusted EBITDA falling to £270 million.

The UK hub states: “Government policies over recent months have effectively closed borders. We have had no government support, other than furlough, and have not been given relief from business rates, unlike other airports, retail and hospitality businesses.

“The March Budget is the key opportunity for the Chancellor to support the sector by providing 100% business rates relief, extending the furlough scheme and reversing the tourist tax.

“We acted quickly to cut gross operating costs by nearly £400m, reduced capital expenditure by £700m and raised £2.5bn in funding including a £600m capital injection. We ended the year with £3.9bn of liquidity, enough to see us through until 2023.

“The CAA must act now to unlock lower charges and more investment for consumers – If the CAA acts to approve a RAB adjustment, to recover regulatory depreciation and provide a fair balance of risk and reward, they can unlock lower airport charges and higher investment in passenger service and resilience.”

It goes on: “We support the Prime Minister’s plan to restart travel and the economy. We will work with the Global Travel Taskforce, so that Britain can become the first country in the world to safely restart international travel and trade at scale, saving thousands of jobs and reinvigorating the UK economy.

“The Prime Minister has a unique opportunity to agree a common international standard for safe travel with other world leaders when he hosts the G7 in June.”

Despite today’s hugely difficult operating environment, the airport maintains that it remains committed to being a good neighbour by reducing its carbon footprint.

“We remain focused on decarbonising aviation,” says Heathrow’s statement. “We became carbon neutral in 2020 and have been working to make decarbonising aviation a flagship goal for COP26 ahead of a global agreement for net zero emissions by 2050 at the ICAO general Assembly in September 2022.”

It is, however, quick to note that Heathrow’s expansion is “mission critical to delivering Global Britain”, and with the Supreme Court reinstating the Airports National Policy Statement, the gateway promises that it will consult with investors, government, airline customers and regulators on its next steps.

Heathrow CEO John Holland-Kaye said:  “2020 has been one of our most challenging years – but despite £2bn of losses and shrinking to passenger levels we haven’t seen since the 1970s, I am hugely proud of the way that our colleagues have kept our passengers safe and the UK’s hub airport open for vital supplies throughout.

“We can be hopeful for 2021, with Britain on the cusp of becoming the first country in the world to safely resume international travel and trade at scale.

“Getting aviation moving again will save thousands of jobs and reinvigorate the economy, and Heathrow will be working with the Global Travel Taskforce to develop a robust plan underpinned by science and backed by industry.

“The Prime Minister will then have the unique opportunity to secure global agreement on a common international standard for travel when he hosts the G7 in June.

“In the meantime, we need next week’s Budget to support aviation’s recovery by extending furlough and providing 100% business rates relief.”

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