BAA blames £62m loss on fiasco at Heathrow T5

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The Independent Online

Higher landing charges and rising passenger numbers were not enough to keep the airports operator BAA from making a loss as it invested heavily in extra security and counted the costs of the Terminal Five debacle at Heathrow.

Despite a slight increase in turnover, the company reported yesterday that it lost £62m in the first three months of the year – a swing of £170m from the £89m profit it made over the same period a year ago. BAA the losses on the extra costs of hiring 2,200 new security staff since 2006, training and improving airports.

The company was also hit by several one-off expenses, including the £24m it spent leading up to the disastrous opening of Terminal Five in March. Colin Matthews, the chief executive, said: "Our operating profit was clearly affected by higher security and maintenance costs, reflecting the importance we place on delivering a safe and convenient service to passengers, through higher standards and better facilities."

However, BAA's loss is unlikely to win sympathy from airline users who have complained tirelessly that they are vastly overcharged for poor service. Yesterday, BAA and British Airways were forced to further postpone the final phase of moving BA's long-haul flights to Terminal Five from 5 June until September – nearly five months later than the original target date of 30 April. The delay will anger other airlines which had drawn up meticulously timed plans to move into the space in Terminal Four being vacated by BA.

BA said the first long-haul services would transfer on 17 September and the rest would be swap over by the end of October. The news comes after BAA forecast earlier this month that its profits from Heathrow would double over the next five years, to nearly £1.4bn. Airlines seized upon on the numbers as evidence of what they claim is profiteering at their expense.

BAA is fighting airlines on other fronts. The no-frills carriers easyJet and Ryanair have vowed to withhold some of the fees they pay BAA for permission to land at Gatwick and Stansted until a judicial review of higher landing charges, imposed by the Civil Aviation Authority, is completed. Meanwhile, talks between BAA and the airlines over a new pricing regime at Stansted have been postponed until next year after previous discussions descended into acrimonious bickering.

BAA, which owns the airports at Heathrow, Gatwick, Stansted, Glasgow, Edinburgh, Aberdeen, Southampton and Naples, said passenger numbers at its terminals rose by about 1 per cent during the first three months of the year to 33.4 million. Average passenger fees were up 14 per cent to £7.07 from £6.21 last year.