BAA on Tuesday reported higher full-year underlying operating profits and revenues as it sought to strengthen its defences against an ?8.8bn ($16.5bn) hostile takeover bid by Spain?s Ferrovial.
The UK airports operator said underlying operating profit rose more than 8 per cent to ?710m, although on a statutory basis it fell more than 16.5 per cent to ?859m. Pre-tax profit fell 17 per cent to ?757m but was up nearly 2 per cent once exceptionals were stripped out. Revenue rose 7.5 per cent to ?2.28bn.
Mike Clasper, chief executive, forecast a 3.5 per cent rise in passenger traffic for the current year, adding: ?I am confident that we will convert this growth into another good financial performance?. Developments at London?s Heathrow and Stansted airports and plans for Budapest, which BAA took over late last year, meant ?that shareholders have strong reasons for confidence in the value of BAA?, he added.
The forecast percentage rise in passenger numbers for this year is the same as that forecast for last year. However, the actual rise for last year was just 2 per cent. BAA attributed the shortfall to the London bombings in July, the Gate Gourmet catering staff industrial dispute at Heathrow and a slowing UK economy.
BAA?s cost-cutting programme led to ?57m in exceptional charges in the year, as forecast, but is on track to bring savings of ?45m a year from 2008. ?At that stage the UK organisation will be leaner, better managed and more appropriately positioned to deliver service and financial performance?, the company said.
Income from aeronautical charges ? tariffs paid by airlines to use the airports ? was up 9.6 per cent at ?898m. At Heathrow, the increase was 11.1 per cent while at fast-growing Stansted it was 16.1 per cent, and at Gatwick it was 6.3 per cent.
Net retail income rose 4.8 per cent to ?616m and retail income per passenger rose 2.9 per cent. The proposed final dividend is 15 ? p, up 6.6 per cent.
Two weeks ago BAA urged shareholders to reject the 810p-a-share hostile takeover bid launched in April by a consortium led by Ferrovial, the Spanish construction, infrastructure and services group.
BAA has also rejected a preliminary and highly conditional 870p a share approach from a consortium led by the Goldman Sachs Infrastructure Group, which would value BAA at ?9.4bn.
The company said on Monday that the costs of its defence against Ferrovial had amounted to ?15m before the bid went hostile.
In early London trade, BAA shares were ?p lower at 837p.