Bristol Airport - General Thread

[Sierra3]

Seems that there will be more 're-purposed' loans to Cardiff airport.

https://www.bbc.co.uk/news/uk-wales...s/politics&link_location=live-reporting-story

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On another point both BRS, CWL & BOH must be earning marginal income from aircraft storage. Have heard figures from GBP200 to 400 a day, BOH has about 40 BA aircraft stored.

 

[TheLocalYokel]

Seems that there will be more 're-purposed' loans to Cardiff airport.

https://www.bbc.co.uk/news/uk-wales...s/politics&link_location=live-reporting-story

[/URL]

On another point both BRS, CWL & BOH must be earning marginal income from aircraft storage. Have heard figures from GBP200 to 400 a day, BOH has about 40 BA aircraft stored.

Yes, the Wesh Government seems to be switching the focus of some of its previously agreed loans to its wholly-owned airport company to allow it to cope with the effects of COVID-19, which I believe is the responsible thing to do. Airports have to survive this disruption which is unparalleled in peacetime in order to be in a position to return to some sort of normality afterwards.

My understanding is that since full privatisation nearly two decades ago BRS has been an excellent investment for its various owners, both as a cash generator, especially for some of the Macquarie funds in the early years of privatisation, and as a solid and profitable growth asset. I remember reading that when Ferrovial's subsidiary Cintra sold its interest in BRS because of competition issues (in 2006 Ferrovial purchased BAA the then owners of LHR, LGW etc) it was reported that the acquisition and subsequent sale of their stake in BRS was one of the most profitable deals they had accomplished for a while.

Obviously, we have no idea of the ultimate effects on aviation of COVID-19 nor how private sector airport owners will react if their investments fall foul to a major recession that is anticipated because of the virus effects on the world's economy. Given BRS's underlying track record of success since privatisation it might well be that patience will prove to be an ultimate virtue. In any case, most sections of the world's economy are likely to be similarly impacted if a major recession bites.

Incidentally, as someone who was still at school and living a mile or so along the A38 at Redhill when Lulsgate became Bristol Airport in 1957 I found it rather sad to see from Jerry's posted pictures (#1356 last Thursday) that the old terminal building is almost no more, with the original control tower already gone. A few years ago I was lucky enough to be invited into the old control tower to watch the Red Arrows arrive.

 

[Jerry]

Seems that there will be more 're-purposed' loans to Cardiff airport.

https://www.bbc.co.uk/news/uk-wales...s/politics&link_location=live-reporting-story

[/URL]

On another point both BRS, CWL & BOH must be earning marginal income from aircraft storage. Have heard figures from GBP200 to 400 a day, BOH has about 40 BA aircraft stored.

It's the recent loan facility that has already been approved that has been repurposed so nothing extra although the Welsh government has called on the UK government to help out all regional airports. As for parking I'd be surprised if the likes of BRS and CWL are earning much from it considering the airlines involved.

 

[TheLocalYokel]

They have more photos available on their Facebook Groups page.

https://twitter.com/x/status/1245760300294512645

It looks like 16 easyJet Airbuses, 6 TUI (5 B738, 1 B 788), 4 Ryanair B 738, 2 Enter Air B738.

 

[Jerry]

It looks like 16 easyJet Airbuses, 6 TUI (5 B738, 1 B 788), 4 Ryanair B 738, 2 Enter Air B738.

An impressive array of based aircraft! It's just sad that they are not flying at the moment.

 

[kraktoa]

There are now no cars in the entire silver zone. It will be a very rare aerial photo photo of the site if anyone can capture it. Even the short term and long term car parks are bare.

I wonder if anyone travelling in the regular Ryanair dublin flight has uploaded any shots on social media or youtube.

 

[TheLocalYokel]

There are now no cars in the entire silver zone. It will be a very rare aerial photo photo of the site if anyone can capture it. Even the short term and long term car parks are bare.

I wonder if anyone travelling in the regular Ryanair dublin flight has uploaded any shots on social media or youtube.

On 2 April Jerry posted some overhead shots of BRS that included all the parked aircraft and the near empty car parks on the north side. The relevant post is #1,356 within this thread.

 

[kraktoa]

On 2 April Jerry posted some overhead shots of BRS that included all the parked aircraft and the near empty car parks on the north side. The relevant post is #1,356 within this thread.

Thanks for that. The short term car parks are so desolate. Never seen it like this ever.

The OTB looks like its well on the way to being razed to the ground. The main central structure has gone. Thats the end of that history.

Sadly no photos of the silver zone on that site.

Bizarre times indeed.

 

[TheLocalYokel]

Bristol Airport announces furloughs and may make 'difficult decisions'

The international airport has gone from 151 flights a day to eight tracked departures in a week

www.bristolpost.co.uk

Having 'furloughed' 80% of staff a Bristol Airport spokeswoman said that the COVID-19 event is 'a dynamic situation and further reviews and difficult decisions may be necessary to protect the business for the future'. She went on to say that they will be 'scaling back recruitment, and consolidating the operational facilities of the terminal'.

Dave Lees the airport company CEO said that the risk to the industry should not be underestimated. He cited previous challenges such as volcanic ash and terrorism but said that COVID-19 will have far-reaching repercussions.

When asked whether the current crisis would have a bearing on an airport appeal against the local authority's rejection of their expansion plans the airport spokeswoman merely said that the rejection 'risks putting the brakes on the region’s economy and shutting the door to international trade and tourism at a time when the UK needs to show it is open for business'. She went on to say that the airport will review the local authority's reasons for refusing the application and then make a decision on their next steps.

Prior to the COVID-19 pandemic it seemed a certainty that the airport would appeal to the Planning Inspectorate and have a good chance of success, although because of the Green Belt issue the final decision would be taken by the secretary of state.

Events might now make an appeal and the outcome of one less certain.

We don't know the stance the government will take with regard to climate change post-COVID-19. There might be political imperatives to soft-pedal a bit on aviation expansion, particularly airport expansion, after the apparent substantial improvement in air quality that the worldwide massive reduction in flying and vehicle traffic has brought about.

We don't know either how pension funds such as the very large one (OTPP) that owns BRS will view airports in the future. BRS has certainly proved an excellent investment for its various owners since fully entering the private sector nearly 20 years ago.

The danger in not appealing the planning rejection is that if within, say, the next 3-5 years aviation recovers and continues its march forward BRS might find itself scrambling to keep up and might have to submit a brand new planning application to the local authority which the present political make-up would be likely to reject again, and an appeal against that rejection could be several years off the pace, even if successful.

A radical step would be for OTPP to sell the airport but in the present circumstances how much would they get for it?

One broad brush means of estimating airport values is using a multiple of EBITDA. In recent years many airport values have been rising substantially, with some airports being sold at eye-watering EBITDA multiples - London City for example went for something like 30 x EBITDA (with OTPP part of the purchasing consortium).

Pre-COVID-19 a 15 x EBITDA multiple for BRS might not have been an unreasonable estimate which, if based on its financial year ending December 2018 (the latest year to be in the public domain), would mean 15 x £55.8 million = £837 million, but COVID-19 will no doubt play havoc with current airport valuations. EBITDA is only a guide anyway, particularly if based on the latest year's financials which could be atypical at some airports.

Selling BRS now or before the full COVID-19 effects on aviation become much clearer might lose its owners a considerable amount if the airport was sold for a song and then the aviation outlook changed for the better going forward. In 2001 when BRS was fully privatised it was sold for just under £200 million.

I'd be extremely surprised if the owners don't retain their investment and I still anticipate an appeal against the local authority's planning application rejection.

 

[kraktoa]

In the history of British aviation, not just at Bristol Airport, how many occasions have foreign nationals been evacuated from the UK by planes? There have been Spanish and Greek citizens evacuated from Bristol due to the Covid19 event, maybe more from other airports. Any other past events that would have resulted in the same.

WW2.....?

 

[TheLocalYokel]

In the history of British aviation, not just at Bristol Airport, how many occasions have foreign nationals been evacuated from the UK by planes? There have been Spanish and Greek citizens evacuated from Bristol due to the Covid19 event, maybe more from other airports. Any other past events that would have resulted in the same.

WW2.....?

To a degree it's a matter of semantics. Evacuation? Repatriation?

One of the definitions of evacuation is the removal of someone or something from a dangerous place to a safe one. Repatriation is often used in the sense of non-voluntary return to their country of origin of people who are deemed undesirables.

Whether those who leave the UK at the moment to go back to their own country are thought to be returning to a safer environment is arguable. Those going home to Italy for example might be going to somewhere that is potentially more affected by COVID-19. If on the other hand we think of them as being repatriated circumstances suggest that it would be with their blessing and not against their will.

Many neutrals did leave the UK for their homeland in the run-up to WW2 and in its early days. Probably most didn't fly to reach their home country though but used liners to get back to the USA or the ferry and trains for Europe.

Bristol actually paid a leading part in the movement of people to and from the UK during WW2. The old Whitchurch Airport was the primary British land airport for most of the war. At the outbreak Imperial Airways and British Airways (not the current one) were moved to Whitchurch and became BOAC. They were joined by KLM aircraft that were transferred to the British register with the consent of the Dutch Government-in-exile in London. KLM crews accompanied their aircraft.

The main route was from Whitchurch to Lisbon in neutral Portugal, with Shannon in the Republic of Ireland added later. Both routes gave connectivity to the USA and to other countries. KLM DC3s often operated the Lisbon route. Although highly secret at the time with window blinds drawn until the aircraft had left British airspace Lisbon was a city of great intrigue during the war.

Agents of both the Allies and the Axis always monitored the comings and goings of the aircraft belonging to the opposing side. The Bristol-Lisbon route carried the Great, the Good and the Important, from senior government officials, major entertainers, captains of industry to royalty.

After the war it became known that such people as Eleanor Roosevelt (the US President's wife), Queen Wilhelmina of the Netherlands, Bing Crosby, Bob Hope (who had lived in St George, Bristol as a very young child) and many more prominent individuals had used the Bristol-Lisbon link.

The Germans made no attempt to disrupt the route as it was in their interest to note those arriving and departing, although I suspect that people such as the Queen of the Netherlands and the wife of the US president had to be managed very discreetly to try to prevent their being recognised.

All went well until 1 June 1943 when a returning KLM DC3 operating for BOAC was shot down by the Luftwaffe over the Bay of Biscay. All on board were lost including film star Leslie Howard (he of Gone With the Wind and The First of the Few in which he played the part of RJ Mitchell the designer of the Spitfire) who was returning to the UK after a propaganda lecture tour of the Iberian Peninsula on behalf of the British Government.

Many conspiracy theories about the shooting down evolved after the war including the fact that the Germans thought that Winston Churchill was on board (Howard's manager apparently bore a resemblance to the prime minister). Many years later it emerged that the incident was probably a ghastly mistake. A flight of Luftwaffe aircraft were on patrol protecting U-boats when they spotted an aircraft painted in camouflage (although a civilian airliner the DC3 was camouflaged). They mis-identified the DC3 and shot it down. When they later learned the identity of their victim the Luftwaffe crews were apparently mortified that they had shot down an unarmed civilian airliner.

So given the nature of the Lisbon link it's highly likely that some people were evacuated or repatriated by air from the UK during WW2.

 

[TheLocalYokel]

Man 'shocked' at these scenes outside Bristol Airport

Staff were on hand to provide reminders about the need for social distancing during the coronavirus crisis

www.bristolpost.co.uk

 

[Aviador]

Now I know rules are rules and we should all be abiding by them by there isn't ever going to be a great deal of social distancing between passenger arriving or departing our airports and to be fair to them, the social distancing inside our local Morrisons supermarket is far more concerning than this image taken from afar.

 

[kraktoa]

It is common knowledge that Airlines are exposed to financial risk due to the large outstanding loans on aircraft that they have to pay to their creditors at a time when they are not generating any revenue. This could bankrupt airlines.

What sort of risk is Bristol Airport exposed to. Do they have large loan interests to pay off. Was all the expansion projects paid for by the owners. As they do not have a large employee structure what is the risk that the airport per se as a company faces. Apart from fears that airlines may not return quickly and that expansion will happen much more slowly, can the Airport go bankrupt as a company.

 

[TheLocalYokel]

It is common knowledge that Airlines are exposed to financial risk due to the large outstanding loans on aircraft that they have to pay to their creditors at a time when they are not generating any revenue. This could bankrupt airlines.

What sort of risk is Bristol Airport exposed to. Do they have large loan interests to pay off. Was all the expansion projects paid for by the owners. As they do not have a large employee structure what is the risk that the airport per se as a company faces. Apart from fears that airlines may not return quickly and that expansion will happen much more slowly, can the Airport go bankrupt as a company.

I touched on the possible ramifications of COVID-19 on BRS’s future in a post above in this thread (# 1372 of 22 April), so this post should be read in conjunction with that.

BRS is owned by the Ontario Teachers’ Pension Plan (OTPP) through a number of companies. OTPP as an organisation has $207 billion in net assets.

The airport parent company is South West Airports Limited but its main subsidiary and effectively the one that operates the airport is Bristol Airport Limited. There are other smaller companies involved in the group such as Bristol Airport (UK) No 3 Limited. Bristol Airport Limited itself has a subsidiary in Bristol Airport Developments Limited (BADL).

In 2018 Bristol Airport Limited spent £20.3 million on capital expenditure (£33.2 million in 2017). However, that’s not the full picture because in 2018 such projects as the multi-story car park, new fire station and new admin building were developed by BADL at a cost of £20.8 million

Bristol Airport Limited has seen annual growth and profits increase steadily over the years since privatisation. The most recent financial report available is that for the year ending 31 December 2018. It shows that the company made a net profit after tax of £35.961 million (2017 was £32.199 million). Turnover in 2018 was £111.997 million (£100.073 million in 2017).

The EBITDA profit in 2018 was £55.8 million. Earnings Before Interest, Taxes, Depreciation and Amortisation (the process of spreading the repayment of a loan, or the cost of an intangible asset, over a specific timeframe) is often used by companies to show profitability. It’s also a way of comparing companies’ profitability with peers.

The Bristol Airport Limited financial report for 2018 stated that, “There is a charge over the assets of the company, as the company is a guarantor to the bank loans in the parent company. The balance of the bank loans at the end of the year was £359,090,000 (£326,090,000 in 2017)".

During evidence given earlier this year to Welsh Government committees it was said by officers of Cardiff Airport that BRS’s overall debt was over £500 million. I don’t know how they arrived at that figure.

Obviously manageable debt can be a valuable tool to help grow a company. BRS’s track record suggests that their debt has been entirely manageable within the context of rising profits. In addition, the greatly enhanced airport infrastructure has undoubtedly increased the value of the airport itself by a very substantial sum, but a reminder that the first paragraph of this post should be taken into account.

I would make it clear that I am not an accountant, nor am I in the aviation industry, so none of this should be regarded as coming from a professional in these fields.

 

[Jerry]

BRS overall will be fine. Unlike other airports it's route network hasn't been decimated and it'll no doubt benefit from what's happening at those other airports.
It might lose some frequency on routes and some more fringe routes but Easyjet, Ryanair and TUI will in no doubt stick around at the airport.
Bristols owners have invested a lot into it so I've no doubt they'll stick by it in these tough times.

 

[kraktoa]

So the loans of £350 million to £500 million will be attracting sizeable interest charges from the lenders.....if the lenders are banks. So the parent company and all its mire of subsidiaries must surely be exposed to risk if the lack of revenue due to Covid19 is affecting their interest payments. Does BRS pay rent on the land or do they own the land outright.

 

[Jerry]

If I remember correctly didn't Roger Lewis say Bristols loans were shareholder loans? Not commercial to banks?

 

[TheLocalYokel]

So the loans of £350 million to £500 million will be attracting sizeable interest charges from the lenders.....if the lenders are banks. So the parent company and all its mire of subsidiaries must surely be exposed to risk if the lack of revenue due to Covid19 is affecting their interest payments. Does BRS pay rent on the land or do they own the land outright.

As as as I'm aware all the airport land is owned by OTTP though its airline companies. They also own some land outside the airport boundary.

If the COVID situation did present the airport company with difficulty in servicing its debt they would no doubt consider renegotiating the loans.

The ultimate owner is a huge pension fund and its airport company has probably been a good customer to the banks. I can't see that it would be in banks' interest not to co-operate knowing that the situation would likely turn around post-COVID.

If I remember correctly didn't Roger Lewis say Bristols loans were shareholder loans? Not commercial to banks?

Some of the loans might be - I don't know - but in the 2018 financial statement there is a definite reference to a balance of the bank loans being £359 million.

 

[andrewgreen]

Where is the land that the airport owns outside it’s boundary ?