Manchester Airport Grp Funding PLC Annual Financial Report (5434E)

TIDM38LZ

RNS Number : 5434E

Manchester Airport Grp Funding PLC

08 July 2021

Issuer: Manchester Airport Group Funding PLC

Date: 8 July 2021

Manchester Airport Group Funding PLC

Company No. 8826541

Annual Results

The Issuer's parent, Manchester Airport Group Investments Limited ("MAGIL"), today publishes its Annual Financial Report and consolidated financial statements for the year ended 31 March 2021.

MAGIL's parent, Manchester Airports Holdings Limited ("MAHL"), today also publishes its Annual Financial Report and consolidated financial statements for the year ended 31 March 2021.

The Annual Reports and consolidated financial statements for MAHL and MAGIL are available on MAHL's Investor Relations website at magairports.com/investor-relations.

Investor Presentation

A conference call to present the results to bondholders, bank lenders, rating agencies and credit analysts will be held on Thursday 8 July 2021 at 10.00 am (UK time). The call will be hosted by Jan Bramall, Chief Financial Officer, Ken O'Toole, Chief Development Officer and Iain Ashworth, Corporate Finance Director,

Dial-in details for the call are: UK local/standard international: [phone]. Confirmation code: 8321926.

The presentation can be viewed online during the event by using the link:

https://storm-virtual-uk.zoom.us/webinar/register/WN_6VTVCM4RQoapbD1VXr2VYg

MAGIL results for the 12 months ended 31 March 2021

MAGIL's performance for the 12 months to 31 March 2021 reflects the unprecedented period the aviation industry has faced this year following the impact of COVID-19.

Passenger numbers for the year fell to 6.3 million, a reduction of 89.4% compared to the 59.6 million passengers in the previous year. As a direct result MAGIL, in common with every other major aviation business, made a significant loss during the period. Adjusted EBITDA* decreased from GBP377.6 million to GBP(170.1) million (GBP(547.7) million, (145.0)%).

Total Business

 
 Key Financials                12 months ended   12 months ended   Change (%) 
                                 31 March 2021     31 March 2020 
                                        (GBPm)            (GBPm) 
----------------------------  ----------------  ----------------  ----------- 
 Revenue                                 184.7             901.0      (79.5)% 
 Adjusted EBITDA*                      (140.2)             404.8     (134.6)% 
 Adjusted EBITDA*(excluding 
  impact of IFRS 16)                   (170.1)             377.6     (145.0)% 
 Result from operations 
  (before significant 
  items)                               (313.7)             227.8     (237.7)% 
 Result from operations                (351.6)             204.2     (272.2)% 
 Result before taxation                (374.8)             165.4     (326.6)% 
----------------------------  ----------------  ----------------  ----------- 
 
 
 Passengers         12 months ended   12 months ended   Change (%) 
                      31 March 2021     31 March 2020 
                                (m)               (m) 
-----------------  ----------------  ----------------  ----------- 
 Manchester                     2.8              28.2      (90.1)% 
 London Stansted                3.1              26.9      (88.5)% 
 East Midlands                  0.4               4.5      (91.1)% 
-----------------  ----------------  ----------------  ----------- 
 Total                          6.3              59.6      (89.4%) 
-----------------  ----------------  ----------------  ----------- 
 

Table 1 - MAGIL key financial information for continuing and discontinuing operations (see Appendix 1 for a reconciliation to the Annual Financial Report and consolidated financial statements of MAGIL)

* Adjusted EBITDA is earnings before interest, tax, depreciation, amortisation, gains and losses on sales and valuation of investment properties, and significant items

MAGIL's response to the pandemic has been measured, strong and focussed on long-term recovery. All non-essential expenditure was frozen, all colleagues took a 10% pay cut from April 2020, as well as a major streamlining of the workforce across its entirety including management, back office functions and operational staff to reflect the short term reduction in operating activity. MAGIL has also taken decisive steps to significantly reduce operating costs through the alignment of infrastructure and resources to meet the revised traffic demand.

Shareholders have been supportive through this period providing GBP300 million of new equity, which together with GBP400 million raised through the sale of MAGIL's non-core property portfolio contributed to a cash position of GBP518.1 million at 31 March 2021. In addition, banks and listed bondholders strongly endorsed MAGIL's financial and strategic response by agreeing to waive financial covenant tests, in June 2020, for the calculation periods to September 2020 and March 2021 and an amendment to September 2021. In June 2021 banks and bondholders agreed a further 12 month extension to these waivers and amendments.

The increase in supply of vaccines, the steps being taken by countries to roll out the vaccine to vulnerable categories in the first instance and the testing protocols that are being put in place by governments, will allow the gradual re-introduction of international travel as border controls are gradually relaxed as the impacts of the pandemic reduce. MAGIL has introduced additional health measures, testing facilities and controls at its airports to provide a safe environment for our passengers, customers, airlines and colleagues as airlines start up their operations again.

Other headlines

-- Significant investment has been completed in the last three years and MAG's modern infrastructure will be an important component of a strong recovery. Following the outbreak of COVID-19, MAG has reduced and refocussed expenditure on its capital projects, given the reduction in passenger demand. Phase 2 of MAG's main capital project; MANTP, is now complete. The Terminal 2 extension is complete and will be ready to open as capacity returns. Manchester Airport's modern facilities will continue to be the international gateway for the North, providing passenger and airline facilities for the future, and supporting commercial yields and operating efficiencies.

-- As at 31 March 2021, the Group's total listed bonds in issue were GBP1,460 million (GBP360 million maturing in April 2024). Together with the GBP500 million revolving credit facility and a GBP90 million liquidity facility (both maturing June 2023), along with retained cash resources, these facilities provide the Group with a long-term stable funding platform.

-- Following the impact of COVID-19 and in accordance with the Amendment and Waiver Deed no dividends will be paid throughout the covenant waiver period. Dividends paid by MAHL are funded via Distributions from MAGIL.

-- MAG's financing strategy incorporates its strong investment grade ratings with Fitch and Moody's and a long-term financing structure to support growth. Maintaining this financial stability, even during the pandemic and the Group's recent transformation activities, places MAGIL in a strong position to maintain its operational capabilities and benefit from the upturn in demand levels.

-- MAG has acted promptly and successfully implemented a strategic financing response. This includes significant cash mitigation measures across costs and capital expenditure; secured GBP300 million of additional funding from its shareholders; together with the GBP400 million realisation of MAG's non-core investment property. All of which, together with MAG's strong liquidity position at 31 March 2021, provides strong levels of funding beyond the next 12 months.

Note on MAGIL Results

A reconciliation between the financial results of MAGIL and MAHL is available in the appendix of the Investor Presentation, which is available on MAHL's Investor Relations website at magairports.com/investor-relations.

Enquiries:

   Investor Relations                                               [e-mail] 
   MAG Press Office                                                [e-mail] 

Appendix 1

Reconciliation of Table 1 to the Annual Financial Report and consolidated financial statements of MAGIL for the year ended 31 March 2021

 
 Key Financials                       12 months ended 31 March                        12 months ended 31 March 
                                             2021 (GBPm)                                           2020 (GBPm) 
                                Continuing   Discontinued       Total    Continuing   Discontinued       Total 
                                Operations     Operations    Business    Operations     Operations    Business 
----------------------------  ------------  -------------  ----------  ------------  -------------  ---------- 
 Revenue                             176.2            8.5       184.7         872.1           28.9       901.0 
 Adjusted EBITDA*                  (148.1)            7.9     (140.2)         379.4           25.4       404.8 
 Adjusted EBITDA*(excluding 
  impact of IFRS 
  16)                              (178.0)            7.9     (170.1)         352.2           25.4       377.6 
 Result from 
  operations (before 
  significant 
  items)                           (321.6)            7.9     (313.7)         202.6           25.2       227.8 
 Result from 
  operations                       (359.5)            7.9     (351.6)         185.2           19.0       204.2 
 Result before 
  taxation                         (418.4)           43.6     (374.8)         151.9           13.5       165.4 
----------------------------  ------------  -------------  ----------  ------------  -------------  ---------- 
 
 

* Adjusted EBITDA is earnings before interest, tax, depreciation, amortisation, gains and losses on sales and valuation of investment properties, and significant items

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July 08, 2021 02:00 ET (06:00 GMT)