Even with government money, Cardiff airport continues to make a loss
Cardiff Airport is continuing to make a loss as it struggles to attract passengers back to pre-pandemic levels. It lost £4.5m in the year to March 2023 according to company accounts, after receiving a government grant of £5.3m. The company, which is owned by the Welsh government, is hoping to make more use of its land to raise money.Welsh government ministers are currently supporting the airport through a grant worth £42.6m over four years. Over the years it has received millions in government loans. In 2021 Labour ministers wrote off a £42.6m loan they had given the airport, leaving it to repay £26.3m by 2045. The number of passengers using the airport in the year up to March 2023 was only 58% of the number using it before Covid.
.
Tweet
Cardiff Airport continuing to make losses
14.2.2024 (BBC)
By David Deans, BBC Wales political reporter
Cardiff Airport is continuing to make a loss as it struggles to attract passengers back to pre-pandemic levels.
It lost £4.5m in the year to March 2023 according to company accounts, after receiving a government grant of £5.3m.
The company, which is owned by the Welsh government, is hoping to make more use of its land to raise money.
The Welsh government said the airport is working to restore flights to the facility and diversify its business.
Cardiff Airport said it facilitates 4,000 jobs related to aviation in the Vale of Glamorgan, where it is located.
The accounts report the first full financial year after Covid travel restrictions were lifted, and the year that Wizz Air pulled out.
Welsh government ministers are currently supporting the airport through a grant worth £42.6m over four years.
Cardiff Airport to be loaned more taxpayers’ cash
Over the years it has received millions in government loans. In 2021 Labour ministers wrote off a £42.6m loan they had given the airport, leaving it to repay £26.3m by 2045.
Some 910,000 used the airport in the year to March 2023, which was 380% more than the previous 12 months.
However it was only 58% of the figures from the last reported pre-pandemic year.
The accounts record pre-tax losses for 2022-23 of £4.5m.
However Cardiff Airport also uses a different measure, EBITDA which records earnings before tax, interest and other items, to report on its financial performance.
Using EBITDA Cardiff Airport said it reported a profit of £863,000 in 2022-23. It says its underlying losses fell by £2.1m from the year before, when it received a £7.9m grant.
Rather than just relying on passengers, Cardiff Airport is hoping to increase its income by making more use of its runway and land.
The accounts say that the decision of Wizz Air to close its operations in early 2023 reinforces “the need to ensure that dependence on passenger activities for the majority of revenues is reduced”.
There were hopes Qatar Airways would recommence flying from Cardiff Airport by the end of last year, but it is yet to return to the airport.
In an interview with Walesonline, Cardiff Airport Chief Executive Spencer Birns said there was a “commercial negotiation taking place” and the airport was working on a resumption with Qatar “as soon as possible”.
‘Losses will only grow’
The Welsh Conservatives’ Natasha Asghar said: “We were told Qatar Airways were coming back in December, yet here we are in February and there is no sign of flights to Doha.
“Diversification of the airport has to be the utmost priority for Labour’s Transport Minister, if more operators do not come on board Cardiff Airport’s losses will only grow.”
A Welsh government spokesperson said: “We’re committed to maintaining an airport in Wales because of the benefits it brings to the Welsh economy and its local supply chain.
“The airport generates over £240m GVA to the Welsh economy, annually. The executive team continues to work hard to restore flights and diversify the business as part of its recovery from the pandemic.
“Commercial discussions remain ongoing between Cardiff Airport and the airline regarding the resumption of the Qatar Airways’ Doha service from Cardiff.”
‘4,000 jobs’
Mr Birns said Cardiff Airport drives “over £246m of direct economic benefit to Wales annually”.
“We facilitate just over 4,000 aviation-related jobs in the Vale of Glamorgan, by ensuring safe and secure airport operations across both the Cardiff and St Athan airfields,” he added.
“The largest employer, British Airways, has been operating from their maintenance centre in Wales for over 30 years.
“The airport typically drives over £246m of direct economic benefit to Wales annually. It’s a vital part of the nation’s economic infrastructure.”
Ryanair is due to add routes to five destinations in the summer of 2024, he added.
https://www.bbc.co.uk/news/uk-wales-politics-68294274?
See earlier:
Anglesey to Cardiff PSO route scrapped by Welsh government – with the money going to public transport
The Welsh Government has scrapped its North to South Wales funded, PSO funded, air service, between Anglesey and Cardiff, saying it will instead use the annual £2.9m public subsidy to improve integrated public transport. The route had been suspended since March 2020 and will not be re-started. The Welsh Government said pre-Covid some 77% of people using route did so for work, but that a shift to hybrid and home-working has cut demand. There is far less demand for business flying. Instead the money saved from running the service will be used to improve public transport in north Wales. This will benefit more people and help reach the Welsh net zero target by 2050. The decision follows an independent study commissioned by the Welsh Government into the carbon impact of the service on the environment. It said this shows the service had a more negative impact on the environment than any other form of travel between Anglesey and Cardiff. Often travel by rail was actually faster, door to door, than by plane.
Click here to view full story…
‘A total waste of Welsh taxpayers money’ What people really think about Cardiff Airport
Welsh Assembly Member questions £21m Cardiff Airport loan from taxpayer – on top of an earlier £38m loan, not yet repaid
Monmouth AM Nick Ramsay has criticised the Welsh Government for its ‘blank cheque’ approach to funding for Cardiff Airport. Mr Ramsay said: “The Welsh Government has committed to this new loan without providing any detail on what the money is for or when it will be paid back. This comes on top of a previous loan of £38 million in 2015 which has also yet to be paid back. Transport minister Ken Skates said the funding – in the form of a loan the airport will pay back – would support “ambitious plans for the future” including a target of two million passengers a year. Mr Ramsay questioned the fairness of the loan, saying: “Businesses in my constituency do not receive this level of support from the Welsh Government and will understandably be questioning the fairness of these funding priorities. We need far more clarity on what this money is being provided for and when we will see an end to what effectively amounts to a “blank cheque” for the Airport. … the public have the right to expect a coherent and rigid timetable for this money to be recovered.” But following the transport minister’s announcement, the Welsh Conservatives said Cardiff Airport would do better if it were re-privatised, where it would not need Welsh taxpayers to shoulder the financial burden.