Cardiff Airport is hopeful that Qatar Airways will resume its direct route to Doha. Despite challenges, the airport aims to return to pre-Covid passenger numbers of 1.6 million a year by 2026.
In its last financial year ending March 2023, Cardiff Airport, owned by the Welsh Government, managed to reduce losses by over £2m to £4.4m. After considering a Covid recovery grant of £5.3m from the Cardiff Bay administration, it reported an EBITDA (earnings before interest, taxes, depreciation and amortisation) loss of £863,000.
With Covid restrictions lifted, revenues increased from £10.6m to £18.5m. The airport recorded pre-tax losses of £4.5m and net liabilities of £4.8m, which includes the pre-tax loss. The airport has received £42m in rescue and recovery grants from the Welsh Government, with £33.7m already used and the remaining £8.9m expected to be used by the end of 2024. Directors expressed confidence in continued support to meet its liabilities.
Since being bought by the Welsh Government in 2013, the airport has accumulated losses of nearly £61m. Qatar Airways stopped flying from Cardiff to Doha when the pandemic began in March 2020. They haven’t started this route again yet.
Cardiff Airport’s boss, Spencer Birns, said: “For Wales to have the Qatar Airways service back would be fantastic and reintroducing connectivity into the Middle East, south-east Asia and Australia where there is high demand. There is a commercial negotiation taking place between us. We are working with the airline on a resumption as soon as possible.”
The airport can make its own deals, but they still need Welsh Government approval. Even if they agree quickly, flights won’t start right away. If Qatar Airways comes back, the plan is to fly four times a week in winter and every day in summer.
Before the pandemic, the airline used a Dreamliner aircraft that could carry just over 250 passengers and 10 tonnes of freight. From March 2019 to February 2020, this route served 94,000 passengers.
Interestingly, 18% of these passengers were from England – a much higher percentage than for all flights from the airport (around 4%). Additionally, 25% of passengers who travelled specifically between Qatar and Wales were travelling for business purposes.
On the topic of the airport’s financial performance and passenger growth (2022-23), Mr Birns said: “We had just over 900,000 passengers and were 58% recovered (to pre-Covid). In that period we managed to reduce our losses by around £2.1m (EBITDA) which was an important factor for us despite the cost of living crisis, higher inflation and energy costs going up, which was a good thing.”
He added: “If you look at the 2023 calendar year, bearing in mind in the 2022-23 financial year we had Wizz Air flying before they pulled out in September 2022, we finished at 841,000 passengers, which was 2% down on where we were in calendar year 2022.
“So, despite losing Wizz in the period, which was 13% of our capacity, the growth we locked in already materialised with some other carriers. If Wizz had stayed we would have been way up, but we were only down marginally despite them going. For the team I thought we did really well in managing that. In the year growth fundamentally came from a number of carriers including Ryanair, Vueling, Tui, KLM and Emerald, which operates the Aer Lingus service to Belfast.”
As for passenger growth in 2024, he commented: “It’s a little bit too early to say where we are likely to land up, but we know Ryanair are adding two routes with Tenerife and Alicante for the summer and we are in talks with them about what extra they could do for next winter. We also have extra capacity coming online on the Loganair route to Edinburgh with a larger aircraft which gives us extra capacity, while Tui is adding around 12,000 extra holidays out of Cardiff as well. We are not sure what else other routes are going to do this year at this stage, but anecdotally demand is outstripping supply and we are actively speaking to airlines about how quickly they could put more capacity on to meet that huge demand to fly.”
When questioned if the airport, with the support of its owner, can still reach the 2026 target of returning to its pre-Covid passenger level of 1.6 million, Mr Birns responded: “It is certainly a big target for us to try and achieve, but we going hell for leather to get back up to 1.6 million by then.”
As of autumn, the Welsh Government had invested over £172.1m into the airport. This does not include the leftover £8.9m in grant support. The Welsh Tories claim a much higher figure of £200m. The Welsh Government could potentially recoup its investment through land sales if it decided to close the airport. However, the government’s return on investment assessment considers the broader impact of the airport on the Welsh economy.
