Air traffic control organisation Nats handled 2.24 million flights in the year to March, up 75% on the previous year as air travel recovered from the pandemic.
But it is expected to take a decade for the business to recover the income shortfall suffered as a result of Covid-19 stifling UK flights.
Nats reported a pre-tax profit of £148.5 million, with a debt adjusted cash flow of £58.1 million.
Nats operates through a private public partnership with the government owning almost half with a group of airlines including British Airways, easyJet, Lufthansa, Tui Airways and Virgin Atlantic holding just under 42%.
The company said: “Flights recovered strongly after the lifting of travel restrictions in March 2022.
“Nats’ planning for recovery, whereby it retained critical skills and delivered simulation training, enabled it to support a safe regeneration and meet all of its safety targets.
“While the result this year reflects the start of the sector’s recovery after the Covid pandemic, as for the results of the last two years, it is not yet supported by the equivalent level of debt-adjusted cash flow generation. This is because Covid suppressed flight volumes and income receipts.”
It added: “Nats expects that, for the regulatory allowances outstanding, the CAA [Civil Aviation Authority] will require their recovery over 10-years from 2023 to support the sector’s recovery.”
The aviation regulator is expected to make a decision on future price controls for Nats this summer.
Nats has sought “appropriate resources” to support increased traffic forecasts “and the service customers have requested now and in the future”.
Chairman Dr Paul Golby said: “It is essential that the CAA’s final decision later this summer provides the resources necessary to support the sector’s recovery and for sustainable investment in the UK’s ATC [air traffic control] infrastructure and recovery of the costs we incurred to provide a continuous ATC service during Covid.”
Chief executive Martin Rolfe said: “It was a welcome relief to see air traffic volumes recover strongly last summer following the lifting of Covid travel restrictions.
“We had made a conscious decision during the pandemic to retain the essential skills to support the recovery. This meant we were able to ramp our operation back up very quickly and safely support the level of demand.
“Our result this year also reflected the start of the sector’s recovery after the Covid pandemic but, as with the results of the two previous years, it is not yet supported by the equivalent level of cash flows on a debt-adjusted basis.
“Given its scale, we expect that the CAA will require the income shortfall we experienced during Covid to be recovered over an extended 10-year period.”