Gatwick’s grim warning as first half losses spiral to £321m

Wednesday, 28 Aug, 2020 0

Gatwick Airport has become the latest to warn that a pre-Covid recovery will be long and painful after revealing passenger numbers fell 66% in the first six months of the year with revenue plunging 61%.

Earnings were virtually wiped out, falling more than 93%, leading to a financial loss in the period of £321m.

Gatwick said it is unlikely to return to pre-pandemic traffic levels until 2024 or even 2025.

The grim picture caps a dismal week for the airport which on Wednesday said it will cut 600 jobs when the government’s Job Retention Scheme ends in October.

The airport said it had taken ‘decisive and swift action’ to protect the business with planned capital expenditure cut by £157m for 2020 and £196m for 2021.

Operational savings of £100m were made by consolidating air traffic to one terminal, terminating fixed term contracts and improving efficiencies of its services in line with reduced demand.

Gatwick Airport Chief Executive Stewart Wingate said: "Like any other international airport, the negative impact of Covid-19 on our passenger numbers and air traffic at the start of the year was dramatic and, although there are small signs of recovery, it is a trend we expect to continue to see.

"However, we are focussed on ensuring the business remains robust and is best placed to take advantage of future growth."

Wingate recognised the pain being felt by its workforce but said the airport will emerge a ‘fitter and stronger organisation’.

"In this post Covid-19 travelling world, we are working hard with our airlines to ensure we continue to offer our customers a wide choice of destinations and carriers," Wingate added. "We also expect, next year, to progress our plans to bring the existing Northern (stand-by) Runway into routine use which, as we rebuild our passenger numbers over the next four to five years, will enable us to offer even more travel choice.

"We will ensure we continue to deliver our operation mindful of our environmental, social and governance responsibilities. We want to rebuild better."

Wingate vowed that Gatwick will ‘recover and retain its position as one of the UK’s leading travel hubs and economic driver for the region’.

By Steve Jones, Contributing Editor