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Heathrow expects a record number of passengers to pass through the airport this year, after booming demand for travel on the lucrative transatlantic routes helped it report a profit for the first time since the pandemic.
The owners of the UK hub airport on Wednesday forecast a record 81.4mn passengers would travel through it this year, up from 79.2mn in 2023.
The buoyant outlook came after Heathrow enjoyed a strong close to 2023, including its busiest ever December, driving its return to profit following three straight years of losses.
Transatlantic routes performed “particularly well”, Heathrow said, as it also pointed to a “significant rebound” in the Asia Pacific market.
The business reported an adjusted pre-tax profit of £38mn for 2023, compared with a loss of £684mn a year earlier.
The figure includes the cost of servicing the airport’s £16.8bn net debt, which stood at £1.46bn in 2023.
Heathrow has been slower to return to profit than many airlines because of these financing costs, but has also blamed the UK aviation regulator for forcing it to cut its landing fees, leaving it less room to raise revenue.
“We will have to pull every lever to become more efficient and make tough choices on where we spend and invest our money to overcome the huge cost challenge set by the Civil Aviation Authority and remain profitable over the next three years,” new chief executive Thomas Woldbye said.
The airport said it could “plausibly” pay its owners a dividend this year, although one is not planned.
Heathrow is in the midst of the biggest shake-up of its ownership since its privatisation in the 1990s, after Spanish infrastructure group Ferrovial in November said it would sell its 25 per cent stake to Saudi Arabia’s PIF and French buyout group Ardian for £2.4bn.
Three other shareholders — the UK’s Universities Superannuation Scheme, Canada’s Caisse de dépôt et placement du Québec (CDPQ) and Singapore’s GIC — have also exercised a right to try to sell their stakes alongside Ferrovial, meaning 60 per cent of the airport is set to change hands if buyers can be found.
Woldbye is also considering whether to reopen a push to build a third runway.
On Wednesday, Heathrow said it was continuing an internal review into expansion, and the “different circumstances we find the aviation industry in” since its previous plans were published in 2019.
Woldbye has been exploring options for a new expansion plan that would prioritise smaller improvements before construction of a controversial third runway is considered, the FT reported in December.
