TIDM38LZ
RNS Number : 9757H
Manchester Airport Grp Funding PLC
09 December 2020
Issuer: Manchester Airport Group Funding PLC
Date: 9 December 2020
Manchester Airport Group Funding PLC
Company No. 8826541
Interim Results
The Issuer's parent, Manchester Airport Group Investments
Limited ("MAGIL"), today publishes its Interim Financial Report and
consolidated financial statements for the half year ended 30
September 2020.
MAGIL's parent, Manchester Airports Holdings Limited ("MAHL"),
today also publishes its Interim Financial Report and consolidated
financial statements for the half year ended 30 September 2020.
The Interim Reports and consolidated financial statements for
MAHL and MAGIL are available on MAHL's Investor Relations website
at magairports.com/investor-relations.
Investor Presentation
A conference call to present the results to bondholders, bank
lenders, rating agencies and credit analysts will be held on
Wednesday 9 December 2020 at 10.00 am (UK time). The call will be
hosted by Iain Ashworth, Corporate Finance Director, Jan Bramall,
Chief Financial Officer, and Ken O'Toole, Chief Development
Officer.
Dial-in details for the call are: UK local/standard
international: +44 (0)330 336 9411. Confirmation code: 2920238.
The presentation can be viewed online during the event by using
the link:
https://storm-virtual-uk.zoom.us/webinar/register/WN_PiphD4RpSX2m9IeRtAs_fA
MAGIL results for the 6 months ended 30 September 2020
MAGIL's performance for the 6 months to 30 September 2020
reflects the unprecedented period the aviation industry has faced
this year following the impact of COVID-19.
Passenger numbers for the 6 month period fell to 4.2 million, a
reduction of 88.5% compared to the 36.4 million passengers in the
equivalent period of 2019. As a direct result MAGIL, in common with
every other major aviation business made a significant loss during
the period. Adjusted EBITDA* decreased from GBP268.1 million to
GBP(87.5) million (GBP(355.6) million, (132.6)%).
Total Business
Key Financials 6 months ended 6 months ended Change (%)
30 September 30 September
2020 (GBPm) 2019 (GBPm)
---------------------------- --------------- --------------- -----------
Revenue 102.4 540.6 (81.1)%
Adjusted EBITDA* (73.0) 281.8 (125.9)%
Adjusted EBITDA*(excluding
impact of IFRS 16) (87.5) 268.1 (132.6)%
Result from operations
(before significant
items) (163.8) 199.6 (182.1)%
Result from operations (171.8) 185.7 (192.5)%
Result before taxation (208.3) 186.7 (211.6)%
---------------------------- --------------- --------------- -----------
Passengers 6 months ended 6 months ended Change (%)
30 September 30 September
2020 (GBPm) 2019 (GBPm)
----------------- --------------- --------------- -----------
Manchester 1.7 17.4 (90.2)%
London Stansted 2.2 15.9 (86.2)%
East Midlands 0.3 3.1 (90.3)%
----------------- --------------- --------------- -----------
Total 4.2 36.4 (88.5%)
----------------- --------------- --------------- -----------
* Adjusted EBITDA is earnings before interest, tax,
depreciation, amortisation, gains and losses on sales and valuation
of investment properties, and significant items
MAGIL's response to the pandemic has been measured, strong and
focussed on long-term recovery. All non-essential expenditure was
frozen, all colleagues took a 10% pay cut from April 2020 and the
size of its management team has been streamlined resulting in 25%
fewer leaders and back office roles.
Shareholders have been supportive through this period providing
GBP300m of new equity, which together with GBP340 million raised
through the sale of MAGIL's non-core property portfolio contributed
to a cash position of GBP624.6 million at 30 September 2020. In
addition, banks and listed bondholders strongly endorsed MAGIL's
financial and strategic response by agreeing to waive financial
covenant tests at September 2020 and March 2021 and an amendment to
September 2021.
MAGIL has led industry efforts to influence Government policy so
that the aviation industry can fly more people in the short term
and recover strongly in the medium-to-long term. It has helped the
Government to introduce international travel corridors and then
refine their application to consider islands separately from the
mainland.
MAG has called consistently for a testing regime that would
allow arrivals from higher risk destinations to quarantine for a
shorter period of time. In late November, the Government confirmed
that from 15 December it would introduce a 'Test to Release'
system. The new system includes many of the features of a unified
proposal to the Government that MAG brought the airport industry
together behind earlier in the year. Importantly, the Government
has also set out its ambition to keep refining the system and
introducing faster and cheaper tests when it is safe to do so. MAG
has launched testing centres at all of our airports to allow
customers to book any tests that they need when arriving in the UK
and for those looking to travel to other countries with
pre-departure testing requirements.
Alongside our work to respond to the COVID-19 pandemic, MAGIL
continues to focus on preparations for the end of the UK's
transition period as we leave the European Union. We have put in
place robust plans and arrangements to prepare the business for 1
January 2021, whatever the result of ongoing negotiations with
Brussels. We have been trialling operational processes and ensuring
they align with new post-Brexit rules and regulations - both in our
terminals and around our cargo processing facilities. We are
confident that operational disruption will be minimal.
Other headlines
-- Significant investment has been completed in the last three
years and MAG's modern infrastructure will be an important
component of a strong recovery. Following the outbreak of COVID-19,
MAG has reduced and refocussed expenditure on its capital projects,
given the reduction in passenger demand. The main phase of MAG's
main capital project; MANTP, is near completion and will be
completed in early 2021. Phase 3 will be revisited post recovery.
Manchester Airport's modern facilities will continue to be the
international gateway for the North, providing passenger and
airline facilities for the future, and supporting commercial yields
and operating efficiencies.
-- As at 30 September 2020, the Group's total listed bonds in
issue was GBP1,460 million. Together with the GBP500 million
revolving credit facility and a GBP90 million liquidity facility
(both maturing June 2023), along with retained cash resources,
these facilities provide the Group with a long-term stable funding
platform.
-- Following the impact of COVID-19 and in accordance with the
Amendment and Waiver Deed no dividends will be paid throughout the
covenant waiver period. Dividends paid by MAHL are funded via
Distributions from MAGIL.
-- MAG's financing strategy incorporates its strong investment
grade ratings with Fitch and Moody's and a long-term financing
structure to support growth. Maintaining this financial stability,
even during the Group's recent transformation activities, places
MAGIL in a strong position to maintain its operational capabilities
and benefit from the upturn in demand levels when they arrive.
-- MAG has acted promptly and successfully implemented a
strategic financing response. This includes significant cash
mitigation measures across costs and capital expenditure; secured
GBP300 million of additional funding from its shareholders;
together with the GBP400 million realisation of MAG's non-core
investment property. All of which, together with MAG's strong
liquidity position at 30 September 2020, provides strong levels of
funding beyond the next 12 months.
Note on MAGIL Results
A reconciliation between the financial results of MAGIL and MAHL
is available in the appendix of the Investor Presentation, which is
available on MAHL's Investor Relations website at
magairports.com/investor-relations.
Enquiries:
Investor Relations investor.relations@magairports.com
MAG Press Office press.office@magairports.com
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END
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