Profits fall at Desmond-owned airport

PROFITS at the Dermot Desmond-owned London City Airport dropped last year as passenger traffic through the facility remained flat.

For the year to December 31 2002 London City Airport recorded pre-tax profits of stg£6.04 million (€8.6m), down from stg£6.7 million in 2001, according to documents obtained from the Companies’ Office in London.

Turnover for the year was flat at stg£31 million, (€44.2m) although there was a £0.5m fall in revenues from airport charges.

After tax profits fell from stg£4.58m to £4m.

The reason for the dip in profits was the negligible increase in passenger traffic, which came in €1.6m for the year. This year should see an increase in the number of passengers as the airport is now serving 21 destinations, including new services to Manchester and Berlin.

The accounts shows that the company has cash of £10m and over £60m in retained profits.

They also disclose that the directors were paid £216,000 (€308,000) during the year. The five directors are Mr Desmond, his long-time associate Michael Walsh, former minister for finance Ray MacSharry, who acts as chairman, the airport’s chief executive Richard Gooding and company secretary David Thompson.

Mr MacSharry was paid £35,000 (€50,000) to chair the board. The company employs 216 people..

London City Airport says it is the subject of a number of legal actions alleging that the construction of the airport has lowered property values in the area. The directors say they intend to fight the claims.

London City Airport, situated in the Docklands area, was opened in 1986 and made losses for 10 years until it was bought in 1995 by Mr Desmond from John Mowlem Construction group for around €33m. The airport plans to grow its passenger figures to 4m by the end of the decade.

The airport will benefit from the extension of the light rail system, which will cut the city journey to 20 minutes.