Heathrow’s profits are set to drop next year despite a forecast rise in passenger numbers.
The airport’s December investor report projected passenger throughput rising by almost 3% in 2024 to 81.4 million against 79.1 million this year.
However, adjusted earnings are forecast to decline by 16.1% to £1.8 billion.
The airport said this was primarily driven by the Civil Aviation Authority cutting airline fees from £31.57 to £26.74.
Overall revenue is projected to fall by 6.1% to £3.4 billion, with aeronautical revenue decreasing 11.3% to £2.1 billion.
Non-aeronautical revenue is expected to increase by 4.5% to £1.2 billion with operating costs up 9.7% to £1.5 billion, “reflecting lower forecasted inflation and stabilisation of our operating costs”.
The London hub blamed a slight drop in the punctuality of arrivals due to air traffic control strikes in Europe, airspace congestion and “adverse weather events” compared to last year.
“However, departure punctuality has improved, and the gap between both metrics is closing as airline ground handling resources increase,” the report added.
“The strong recovery in traffic at Heathrow continued in the first 11 months of 2023, with a total of 72.5 million passengers travelling through the airport.
“We saw a significant increase in connectivity across various regions, highlighting an impressive recovery, with Heathrow named the most connected airport in the world by OAG. We remain Europe’s busiest airport, and in October became the south busiest airport globally.
“Passenger service levels have improved as a result of the investment in recruitment and training over the past two years. In the first nine months, 74% of passengers rated their overall satisfaction with Heathrow as ‘Excellent’ or ‘Very good’.
“We have also seen very strong performance in security, with 90% of passengers now consistently waiting less than five minutes and close to 100% less than 10 minutes.
The report also reiterated industry support for the development of sustainable aviation fuel, with major airlines using the London hub committing to using 10% of SAF by 2030.
“SAF has a fundamental role to play in aviation’s pathway to net zero, but currently there’s not enough supply. For net zero to be a reality, we need the government and industry to work together to kickstart a domestic SAF industry,” Heathrow said.