BAA results impacted by extra costs

British airports operator BAA today revealed it spent an additional £39m (€55m) on security and improvements during the first nine months of this year.

The group, which is now owned by Spanish infrastructure firm Ferrovial, has come under fire over long queuing times for security and the poor quality of service and cleanliness at its airports, including Heathrow.

It said results for the nine months to September 30 were impacted by the need for additional security measures worth £27m (€38m), while £12m (€17m) was invested in a “fix the basics” programme aimed at improving facilities.

Operating profits fell 18.1% to £544m (€771m), which also reflected one-off items, such as a loss on BAA’s disposal of Budapest airport and £16m (€22.6m) on preparing for Heathrow Terminal Five, which is due to open in March.

Passenger traffic rose 1.4% to £115m (€163m) in the period, while revenues were 2.7% stronger at £1.99bn (€2.82bn). The company’s other UK airports are at Gatwick, Stansted, Aberdeen, Glasgow, Edinburgh and Southampton.

BAA is currently the subject of a Competition Commission investigation into whether the company’s ownership of seven UK airports distorts, restricts or prevents competition. Some airlines have called for the break-up of BAA’s monopoly of the three big south east England airports.

The commission must make its final report by March 2009, but is expected to publish its emerging thinking document early next year. BAA said it was “vigorously defending” its case and said it was best positioned to deliver the extra runway capacity that it believed London required.

The commission has also been looking at the level of charges that BAA is allowed to impose on airlines for using its airports for the period 2008-13.

Passenger numbers at Heathrow were unchanged at 51.4 million for the nine months, while the figure rose 2.8% to 27.4 million for Gatwick. Aircraft charges income was up 7.9% to £834m (€1.18bn), driven by tariff increases at the price-regulated London airports and higher passenger numbers.

UK airports’ net retail income grew by 4.5% to £493m (€698m), it added.