TIDM38LZ
RNS Number : 7942I
Manchester Airport Grp Funding PLC
07 December 2022
Issuer: Manchester Airport Group Funding PLC
Date: 7 December 2022
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 2022.
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 2022.
The Annual Reports and consolidated financial statements for
MAHL and MAGIL, together with the Investor Presentation, and
Compliance Certificate for MAGIL, are available on Manchester
Airports Group'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 7 December 2022 at 10.00 am (UK time). The call will be
hosted by Jan Bramall, Chief Financial Officer, Ken O'Toole, Deputy
Chief Executive Officer and Iain Ashworth, Corporate Finance
Director.
MAGIL results for the 6 months ended 30 September 2022
The removal of all remaining UK travel restrictions in March
2022 triggered a rapid increase in pent up demand for travel and
has resulted in MAGIL delivering a strong financial
performance.
Passenger numbers for the 6 month period were 30.5 million, an
increase of 362.1% compared to the 6.6 million passengers in the
equivalent period of 2021. This equated to 84% of pre-pandemic
levels. MAGIL's revenue has increased by 238.1% to GBP537.6
million, which has resulted in an Adjusted EBITDA of GBP259.9
million, an increase of GBP234.3 million. MAGIL's Operating profit
of GBP22.1 million for the 6 months ended 30 September 2022 (2021:
loss of GBP75.1 million). This result was heavily impacted by a
one-off adjusted item charge of GBP119.7 million following the
extinguishment of the Group's deferred debt agreement (DDA) for the
exit from the Greater Manchester Pension Fund ("GMPF") pension
scheme. The GMPF settlement also gave rise to a GBP116.7m increase
in reserves and therefore an overall net movement of GBP3.0m. The
split of the net movement between income statement and reserves is
in accordance with the requirements of IAS 19. All of MAG's defined
benefit pension schemes are now closed to future accrual.
MAGIL's parent, MAHL, reported an Adjusted EBITDA of GBP261.0
million, and a profit from operations of GBP22.8 million.
Key Financials 6 months ended 6 months ended Change (%)
30 September 30 September
2022 (GBPm) 2021 (GBPm)
---------------------------- --------------- --------------- -----------
Revenue 537.6 159.0 238.1%
Adjusted EBITDA* 259.9 25.6 915.2%
Adjusted EBITDA*(excluding
impact of IFRS 16) 243.6 10.2 2,288.2%
Operating profit
(before adjusted
items) 143.8 (78.9) n/a
Operating profit 22.1 (75.1) n/a
Loss before taxation (28.2) (105.2) 73.2%
---------------------------- --------------- --------------- -----------
Passengers 6 months ended 6 months ended Change (%)
30 September 30 September
2022 (m) 2021 (m)
----------------- --------------- --------------- -----------
Manchester 14.3 2.7 429.6%
London Stansted 14.0 3.5 300.0%
East Midlands 2.2 0.4 450.0%
----------------- --------------- --------------- -----------
Total 30.5 6.6 362.1%
----------------- --------------- --------------- -----------
* Adjusted EBITDA is earnings before interest, tax,
depreciation, amortisation, gains and losses on sales and valuation
of investment properties, and adjusted items
The first six months of this financial year have seen MAGIL
deliver the first full summer season since the onset of the
coronavirus pandemic.
Pent-up demand for travel was suddenly released by the removal
of testing and quarantine restrictions in March this year. The fact
that the aviation sector knew that this demand would come back did
not make it easier to prepare for, given the difficult labour
market and that it can typically take up to three months to train
and vet new aviation recruits before they can start work.
It is important to acknowledge that service levels in some parts
of MAGIL's business were, at times, not where we expect them to be.
This was particularly true in the early months of the summer and
applied both to the operations in MAGIL's direct control and those
delivered by our partners, such as airlines, ground handling
companies and those that deliver assisted travel services.
With much of MAGIL's operational difficulties relating to
recruitment challenges, we are pleased now to be in a position
where more than 2,000 new colleagues have started work with us,
which underlines how important our airports are to the communities
surrounding them in relation to employment.
More than 30 million people travelled through MAGIL's airports
between April and the end of September, representing 84% of the
equivalent period in 2019, pre-pandemic. Many of these people will
have been going on holiday, travelling for business or visiting
friends and family overseas for the first time in more than two
years.
We are proud, as ever, of our role in facilitating these
journeys for those living and working in our catchment area, which
covers the majority of the UK.
Other headlines
-- Significant investment was completed at MAG's airports in the
immediate years prior to the COVID-19 pandemic. Following the
outbreak, MAG reduced and refocussed expenditure on essential
maintenance, safety critical activity and completion of existing
schemes. Phase 2 of MAG's main capital project; the Manchester
Airport Transformation Programme ("MANTP"), is now complete. The
Terminal 2 extension opened in July 2021 and has been well received
by airlines and passengers. 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. Following
the strong recovery, MAGIL has begun a process to remobilise its
previously paused investment plans and will recommence activity in
2023, which will be phased and modular in nature, in line with
MAG's financing strategy and credit metrics commensurate with
maintaining strong investment grade ratings.
-- On 27 May 2022 MAGIL completed a refinancing of its 500
million revolving credit facility and a GBP90 million liquidity
facility, which were scheduled to mature in June 2023. The total
facility sizes and lenders remained unchanged. The new facilities
mature in May 2027 with options to extend by up to two years,
subject to lenders' agreement. Subsequent to the period end, on 31
October 2022 the revolving credit facility, which had remained
fully drawn since March 2020, was repaid in full.
-- MAGIL's GBP1,460 million of listed bonds, together with the
bank facilities described above and retained cash resources of
GBP613.5 million as at 30 September 2022, provide it with a
long-term stable funding platform. MAGIL's Total Net Debt
(excluding IFRS 16) was GBP1,333.7 million at 30 September 2022,
which was GBP379.6 million lower than as at 31 March 2020, at the
beginning of the pandemic.
-- Following two years of waivers, MAGIL's Leverage covenant for
the 30 September 2022 Calculation Date was 3.6x, representing a
reduction of 0.9x since the last calculation in March 2022 (4.5x).
Interest Cover was 5.9x.
-- MAG's financing strategy incorporates its strong investment
grade ratings with Fitch (BBB negative outlook) and Moody's (Baa1
stable outlook) and a long-term financing structure to support
growth.
-- Following the impact of COVID-19 and in accordance with the
Amendment and Waiver Deed no dividends have been paid throughout
the covenant waiver period including up to the date of the
Compliance Certificate delivered on 7 December 2022. Dividends paid
by MAHL are funded via Distributions from MAGIL.
-- In October 2022, MAG re-affirmed its commitment to develop
zero carbon airports, providing education, training and employment
opportunities for all, and to ensuring we give a voice to the local
communities we serve as we develop and grow. We are already working
on a range of important programmes to deliver against these
commitments, from the formation of new youth forums at each airport
and a pledge to develop a new, industry-leading apprenticeship
programme, to our partnerships with Fulcrum BioEnergy and HyNet to
provide sustainable aviation fuel and new hydrogen technologies.
The latest Corporate and Social Responsibility report, together
with other investor material related to ESG, is available on MAG's
Responsible Business website (
magairports.com/responsible-business/csr-reports/ )
Note on MAGIL Results
Reconciliations between the financial results of MAGIL and MAHL
and MAGIL's Adjusted EBITDA (excluding impact of IFRS 16) are
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
IR FLFISFTLRIIF
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