Losses worsen at airport owner BAA on pension scheme charges

Marion Dakers
AIRLINE owner BAA saw its losses widen in the first quarter of the year as a pensions charge hammered its bottom line.

The firm’s pre-tax loss grew 9.4 per cent to £231.3m in the quarter, as the firm booked pension charges worth £128.9m as its defined benefit scheme moved from a surplus into a deficit.

It said the slump, which brought with it extra costs, is “due principally to the impact of changes in forecast inflation rates”.

Employment costs rose 12.4 per cent to £89.6m, and BAA warned these costs will remain higher than first forecast throughout 2012 thanks largely to the pension scheme.

When those exceptional expenses are stripped out, the firm posted an adjusted pre-tax loss of £80.7m for the quarter – slightly better than the £107.7m loss posted for the same period last year.

Revenues rose 11.5 per cent to £537m as BAA’s fees rose and passengers spent more while at the firm’s airports, which include Stansted, Southampton and Glasgow.

Heathrow, Europe’s busiest airport, grew passenger numbers to 15.7m, up 4.4 per cent on the same quarter last year.

Chief executive Colin Matthews said the results show Heathrow “remains resilient in a challenging economic environment” and that its US market continues to perform well.