London’s Southend airport predicts passenger numbers will jump 40 percent to 1.15 million in the next 12 months as Stobart Group Ltd. (STOB) seeks a return on its 120 million pounds ($183 million) of spending in the past two years.
About 800,000 people are now passing through Southend annually and EasyJet Plc (EZJ), Britain’s No. 1 discount carrier, will base a fourth aircraft there starting next month, Chief Executive Officer Andrew Tinkler said today in an interview.
“The airport is at a break-even point,” Tinkler said. “We’re really well-placed to capitalize on London’s capacity limits, so once we reach 2 million passengers a year any extra passengers go straight to the bottom line.”
Southend, 45 miles from London, is seeking to establish itself as a new terminal serving the U.K. capital as crowded hubs such as Heathrow struggle to add more flights. Stobart’s upgrades at what was once Britain’s third-busiest aerodrome include a longer landing strip and a terminal extension to be completed in December which will take annual capacity 5 million.
Though sited on the North Sea, Southend was reclassified as London Southend by the International Air Transport Association in August and added EasyJet as a client in April 2012. Its location outside the capital’s airspace means the amount of time jets are in the air is cut by up to 20 minutes, Tinkler said.
“All we have to do is prove we’re a fast and efficient airport,” the executive said. “Over the next two to three years the group is about realizing the value of these assets.”
Passengers with hand luggage can reach an adjoining train station 15 minutes after leaving their plane, with the 53-minute journey direct to London’s financial district matching travel times from less-distant airports, Tinkler said.
Stobart’s air unit posted a 700,000-pound loss for the year ended Feb. 28, versus a 400,000-pound shortfall in the previous 12 months, according to a statement
Group profit from continuing operations rose 12 percent to 30.9 million pounds, with the company taking a 13.4 million-pound hit against discontinuation of a chilled pallet network.
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