In the six months to June, retail stores, including duty free and travel retail luxury outlets performed relatively flat to the same period last year at London Heathrow Airport (LHR), according to the operator Heathrow (SP).

 

Duty- and tax-free generated £59m ($100m), up +1.9% but airside specialist shops saw no change a £45m (76.4m) – see table below.

 

According to the limited company, the retail growth was “moderated” by a Terminal 5 luxury retail extension which is designed to deliver future growth in retail income. The flat performance was also blamed on the strength of sterling relative to the same period last year.

 

 

However it was not all bad news. Growth in ‘other’ retail income – primarily from media and advertising income, was up by +9.5% or almost £2m to £46m, compared to last year, helped by the introduction of new advertising sites. The new T2 is also forecast to generate media growth for the remainder of 2014.

 

Overall, retail income in the first half at LHR grew by +3.5% to £237m ($402m) with net retail income (NRI) up +4.2% to £225m ($382m); and NRI per passenger reaching £6.42 ($10.90), a rise of +2.2%.

 

During the period, passenger traffic rose by +1.9% to 35.1m. Weakness persisted in Europe and Africa (+0.3% and -0.2% respectively) while the best international gains came from the Middle East at +4.4%. The core North American market grew by +2.2% to 8.0m passengers (see below).

 

 

INTERNATIONAL GROWTH CONTINUES

Intercontinental routes overall performed well in most regions with traffic up +2.5% and this was helped by new destinations as well as increased frequencies to emerging market and other long-haul destinations. These destinations have included Manila, Chengdu, Mexico City, Bogota and Austin inTexas, USA.

 

On LHR’s overall results (see below), John Holland-Kaye, new Chief Executive Officer of Heathrow, says: “Heathrow has performed well over the last six months, with two consecutive quarters of record passenger satisfaction scores reflecting steady operational improvement. Terminal 2 successfully opened on time and on budget, marking the next step in the transformation of passenger service.

 

“My vision is to build on that record of continuous improvement, driving Heathrow to win the case for expansion and become one of the best airports in the world – an ambition which will give the UK a great springboard to continue to compete successfully in the global economy.”