Yahoo Finance Heathrow passenger numbers rise as COVID losses top £4bn
Heathrow passenger numbers rose to 9.7 million in the first three months of the year, but the UK's biggest airport still expects to make a loss in 2022 as COVID losses surpass £4bn ($5bn).
The number of passengers flying through Britain's biggest airport increased by 474.9%, to 9.7 million, from 1.7 million in the same period a year earlier.
However, despite increased outbound demand, the airport is not expecting to return to profit and dividends in 2022. Although revenue rose to £516m in the first quarter of the year and adjusted EBITDA (earnings before interest, taxes, depreciation, and amortisation) reached £273m, total pandemic losses now total over £4bn.
Heathrow reported weaker than expected passenger numbers in January and February due to Omicron-related travel restrictions, but saw demand increase in March after the removal of all UK travel restrictions on 18 March with a surge of last-minute bookings for the Easter holidays.
The airport is expecting this to continue into the summer months and plans to respond by reopening Terminal 4 by July and recruiting over 1,000 new security officers.
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Heathrow said it is also "assisting airlines, ground handlers and retailers to fill over 12,000 vacancies across the airport".
Despite this, Heathrow said the increase in demand driven by UK outbound leisure passengers taking advantage of the end of UK travel restrictions and redeeming travel vouchers from cancelled flights during the pandemic is "temporary" and "remains very volatile".
The west London airport forecasts passenger numbers to drop off significantly after the summer with airlines already cancelling services into the autumn as the "realities of higher fuel costs, lower GDP growth, the war in Ukraine and the ongoing pandemic" drag on demand.
"We are still in a pandemic with many markets still closed, nearly 80% with testing and vaccination requirements and another variant of concern could see the return of UK travel restrictions," the airport said in its latest financial results.
Heathrow updated its 2022 passenger forecast from 45.5 million to 52.8 million, which represents a return to 65% of prepandemic traffic.
Several UK airports, including Heathrow, were in chaos in recent weeks, with passengers facing long queues, delays and cancelled flights due to staff shortages.
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Heathrow said more than 95% of passengers got through security within five minutes during the Easter getaway.
Chief executive John Holland-Kaye said: “I want to thank colleagues who worked very hard to ensure the start of 2022 has gone to plan, and I want to reassure passengers that we’re redoubling our efforts to ensure this summer’s journeys go safely and smoothly.”
