Liverpool John Lennon Airport’s new owners believe it can be profitable, reports Alex Turner

PEEL Group’s 13-year ownership of Liverpool John Lennon Airport (JLA) has seen massive growth at Speke.

In that time, the airport has gone from handling 11,000 passengers a week to 100,000 a week, with routes increasing from three to more than 60.

In the first 44 years of the airport’s operation, from its opening in July, 1933, 19m people used the airport. About the same number of people have used JLA in the last 44 months.

That is naturally reflected in the airport’s income. Turnover increased from £7m in 1996, the year before Peel took over, to £34.4m in the year to March, 2008, with growth above 8% in all but one of the 11 years and showing a compound annual growth rate of 15%.

The recession brought that to a grinding halt in the year to March, 2009, with a 9% fall to £31.3m, and it slipped a further 1% a year later.

The latest accounts, just filed at Companies House, show a pre-tax loss of £8.84m, taking JLA’s total losses under Peel’s ownership to more than £30m.

This is in part because of large annual interest payments, which have totalled £25m in the last six years (although £11m has gone to companies within Peel Group). Last year, it paid a total of £5.1m, made up of £3.64m on bank loans, £1.26m interest to group companies and a £206,000 on finance lease interest.

The losses of 2008 of just £550,000 – when it appeared that a profitable performance was just around the corner – now seem like a distant memory.

But JLA was deemed to be an attractive proposition for Canadian airport group Vancouver Airport Services (VAS), which paid about £110m to Peel Group in June for a 65% share in its Peel Airports division.

JLA accounts for about 80% of the group’s passenger traffic, which also includes Robin Hood Airport Doncaster Sheffield and Durham Tees Valley Airport.

Peel Airport’s chief executive Craig Richmond believes that the airport can be profitable through continued growth and careful cost control.

He said: “Key to the future financial success will be to continue to look at the costs of running the business and see where efficiencies can be improved upon, particularly utilising the expertise and experience that the parent group, Vancouver Airport Services, brings.

“In addition, we will need to both increase passenger numbers and the revenues generated from passengers using the airport and its facilities. The new retail development and other improved facilities will help to achieve this.”