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AGS accounts reveal scale of damage wrought by Covid at Aberdeen, Glasgow and Southampton airports

Aberdeen Airport AIA
Aberdeen International Airport.

Passenger numbers at Aberdeen International Airport (AIA) collapsed by two-thirds during 2020 as Covid-19 wreaked havoc on the travel industry.

But the north-east gateway fared better than most of its rivals around the UK, thanks to North Sea helicopter business – leaving total traveller numbers down by 65.3% at about a million.

Aberdeen Airport AIA
North Sea helicopters helped to offset some of the lost business at Aberdeen International Airport.

Glasgow and Southampton airports suffered year-on-year declines of 78% to 1.9 million and 83.2% to 300,000 passengers respectively.

The massive hit to its business as Covid-19 restrictions ruled out all but essential travel for much of the year plunged AGS Airports – which owns and operates AIA, Glasgow and Southampton airports – into the red last year, with pre-tax losses of £131 million, following profits of £13m in 2019.

‘Material uncertainty’

It also led to bosses and auditors from Deloitte warning of a “material uncertainty” which they said may “cast significant doubt” on AGS Airports’ ability to keep trading.

The losses are revealed in the latest annual accounts for AGS Airports Holdings, with the company also reporting a near-67% drop in revenue to £72m from £217m previously.

Despite the trading shortfall and “material uncertainty” warnings, which are based on ongoing travel uncertainties and the likely pace of recovery in the aviation sector, AGS Airports says it “should be able to manage its business risks successfully”.

Funding options available

A statement from the board, signed by directors John Bruen and Ignacio Castejon Hernandez adds there are funding “sources and options” available to the firm should these be required, in the event of travel restrictions lingering longer than expected.

Commenting on the accounts, a spokesman for AGS Airports said: “AGS and the wider aviation industry has been brought to an almost complete standstill by the coronavirus pandemic – which is reflected in this set of results.

Connectivity ‘severely damaged’

“Not only has it had a direct impact on both our passenger and financial performance, but it has also severely damaged the connectivity our airports have spent decades building up and on which the regions we serve rely so heavily.

“This connectivity, which is central to securing foreign direct investment, enabling our businesses to import and export, and supporting our inbound tourism industry, will take years to rebuild.”

Aberdeen Airport AIA

He added: “Put simply, we cannot trade globally without connectivity and both Scotland and the wider UK’s place on the world stage is at risk.

“If we are to have a meaningful restart and restore passenger confidence, then we need the government to be consistent and transparent with its traffic light system.”

The spokesman said recent announcements for opening up international travel were a “welcome step forward”, but also too little, too late – meaning we have lost another summer”.

Passengers queue up to check in for the first departure to Portugal from Aberdeen after the recent lockdown.

Aviation will play a vital role in driving UK economic recovery”, he said, adding: “Now is the time for government to start working with industry on a long-term recovery plan.

“Other countries have recognised the strategic importance of aviation and are putting support packages in place to preserve and rebuild connectivity. We need to see the same approach from both the UK and Scottish governments.”

AGS Airports is a joint venture between Spanish group Ferrovial and Macquarie Infrastructure and Real Assets, part of Australia’s Macquarie Group. Its three airports were acquired from Heathrow Airport Holdings in a £1 billion-plus deal in late 2014.

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