London Gatwick has hailed its “strong” financial performance for the first half of 2023. Retail revenues soared 35% to £89.7 million for the six months to 30 June. Gatwick H1 passenger numbers hit 18.5m, representing a recovery rate of 83%.
Looking at June numbers alone, passenger numbers increased to 90% of year-on-year pre-pandemic levels.
Total revenues at the airport for the first half stood at £423.3m, up from £291.5m over the same period in 2022.
EBITDA stood at £235.7m (+59%), while operating costs reached £187.6m (+31%).
The short-haul market saw stronger recovery than that of destinations further afield.
Low-cost carrier easyJet saw its traffic climb 24% compared to the same period in 2022, while British Airways capacity soared by 160%. The latter accounted for 9% of all short-haul traffic from the airport in 2023 H1.
Lufthansa and SkyExpress started operations at Gatwick during the period, joining the 34 airlines that now serve 155 short-haul destinations.
Long-haul passengers totally 2.6m for the period, a 62% increase year-on-year, but still 42% lower than 2019 levels.
Highlights included BA launching routes to Vancouver, Las Vegas, Aruba and Georgetown, Guyana. Air China resumed operations at the start of Q2, followed by China Eastern.
Air India, another new carrier for Gatwick, launched four routes and operates 12 weekly services to the country.
Challenges included a greater number of air traffic control restrictions, which led to on-time departures slipping to 62.3% from 64.7% in 2019.
There were environmental issues too, with just 56% of airport waste being reused or recycled in 2022, down from 70% in 2019.
Gatwick H1 retail focus
Net retail income per passenger stood at £4.77 for the six months to 30 June 2023, a slight increase on £4.74 in 2022.
While the top-line growth is modest, Gatwick said in its financial report it masked other factors.
It attributes the overall fall to switching Bureau de Change partners, a move it took to minimise the impact of “adverse market trends”.
In addition, specialist and duty free stores saw lower levels of growth, which shows “the challenges concessionaires face in passing on rising prices”, according to Gatwick.
The airport also noted a high comparison base for pharmacies and bookshops, which saw higher demand in 2022 due to limited onboard provision.
Catering was the star performer, posting gains of 11% over the H1 period.
Gatwick published a six-year Capital Investment Programme which set out its plans to become a net-zero airport for Scope 1 and 2 emissions by 2030.
The airport will invest £250m to this aim, and projects will include replacing over 100 gas boilers.
It also plans to bring its Northern Runway into routine use progressed and will now be more closely scrutinised by inspectors.
Other work includes a £120m extension to North Terminal’s Pier 6, and a £70m programme to boost taxiway efficiency.
A £10m redevelopment of the North Terminal departure lounge is due for completion in 2024.
“Strong demand for travel has continued in the first half of 2023, with passenger numbers up 41% compared with 2022,” said Stewart Wingate, Gatwick’s Chief Executive Officer.
“This is reflective of the travel industry bouncing back in peak periods, but also demand still building outside of those periods.
“Despite a challenging operational environment, we continued to meet our high service standards in the first half of 2023.”
He said that while air traffic movements remain 86% below pre-pandemic levels, he and the team are working closely with Eurocontrol and NATS to ease disruption.
“We’re focused on long-term sustainable growth and central to this is our plan to bring the existing Northern Runway into routine use. If approved, our forward-looking and low-impact plan will use the airport’s existing infrastructure to unlock new capacity and improve resilience.
“Importantly, the plans will secure the long-term future of the airport and economic prosperity for thousands of families, businesses and future generations across the region.
“Building on our sustainability commitment to be net zero for Scope 1 and 2 emissions by 2030, we’ve strengthened our Decade of Change goals.
“We’ve done this by setting out ten roadmaps to achieve quantitative and qualitative outcomes for each goal. This will ensure we grow in an environmentally conscious way, that benefits both our community and the UK economy.”
Earlier this year, Gatwick committed to building greater diversity into F&B offer by championing local brands.