Main facts

 
revenues 

EBITDA

Main facts

In its first complete year forming part of Ferrovial, BAA has achieved considerable progress both in financial results and in improvement in service quality for passengers.

Excluding the contribution of Budapest and the Australian airports sold off during the year, overall perimeter revenues increased by 6.8%. British airports increased by 6.3% in spite of the fact that passengers volumes only increased by 1.6%. This was due to price increases and higher revenues from the shopping areas.

The increase in passengers was mainly due to international traffic because of the new routes created by the low cost airlines, compensating for the drop in the domestic market and helicopter traffic. Higher increases in passenger volume were seen at Aberdeen (7.9%), Edinburgh (5%) and Gatwick (3.2%). Glasgow (-1.1%) was the only airport to see a drop in the number of passengers.

The overall EBITDA was 12.5%, with increases in all airports except Gatwick, Glasgow and Southampton. In the British airports, EBITDA increased by 7.9%. To improve service quality levels for passengers, BAA invested 46 million euro in increasing security personnel by 50% and installed an extra 20% more walkthrough arches, improving service speed.

The London airports are regulated by the Civil Aviation Authority (CAA) and the Competition Commission. Over the last two years, the process for setting the tariffs for the next quinquennium has been carried (2008-2013). On 11 March 2008, the CAA issued its report in which stated a 23.5% tariff increase for Heathrow for 2008/2009 meaning up to 12.8 pounds per passenger. For Gatwick the price will increase 21%, up to 6.79 pound per passenger starting in April. For the subsequent years, until 2013, price caps rise annually by 7.5% above inflation in Heathrow and 2% above inflation for Gatwick. Ferrovial's objective is to make Heathrow the world's leading airport.

On a separate note, the Competition Commission is now in the process of analysing the British airport market, aiming to assess the advantages and disadvantages of the situation of concentration of the airports owned by BAA. Ferrovial considers that BAA's current position guarantees the necessary investments for solving the main problem of British airports, which is their lack of capacity. This process will conclude in 2008 or early 2009.

In 2008, BAA will apply to the regulatory body in order to build a second runway at Stansted. This application has to undergo a long process of consultation and analysis and therefore the new runway and its terminal, with a planned capacity for 10 million passengers, could be in operation by 2015.

This application follows the guidelines of the Aviation White Paper (2003), which refers to the need for two new runways in the south-east of London, one in Stansted and another, meeting certain environmental conditions, in Heathrow.

On 22 November 2007, the Government opened the consultation process regarding the growth of Heathrow, including the development of a third runway at Heathrow adhering to strict environmental criteria both in terms of noise and air quality. At present, the two runways at Heathrow are operating at 98.5% capacity.

In 2007, Heathrow obtained planning permission for a new terminal, Heathrow East, which will replace Terminals 1 and 2. Together with Terminal 5, which was opened on 27 March 2008, and other refurbishments, over the next five years it will completely transform the busiest international airport in the world.

The three Scottish airports owned by BAA -Glasgow, Edinburgh and Aberdeen- have had a satisfactory year, with more than 21 million passengers flying to 130 destinations throughout the world. The operational capacity of Glasgow airport stands out for being able to return to normal operations just 24 hours after suffering a terrorist attack.

In 2007 BAA sold its stakes in Hungary and Australia and in the United States it reached an agreement to withdraw from the Indianapolis Airport contract one year before its expiry.

 Numbers of airlines operating in BAA's UK Airports

 Number of destination from BAA's UK Airports

BAA Story so far: Heathrow will be the future

BAA Story so far: Heathrow will be the future

On March 27th the new Terminal 5 at Heathrow opens its doors. The airline British Airways will move to the new terminal increasing capacity to 30m passengers. This is the first stage in the redevelopment plan.