Teesside-2

[N707ZS]

With thanks to the teesside airport movements Christmas review. The soil is a new engine running area.

[Harold77]

Here is link to the development. I did put it up elsewhere back in November when I came across the application on the portal. Thought I'd put/ mentioned it on here, but seems as I hadn't.

https://www.developmentmanagement.st...=S2U0AKPKL8P00

[N707ZS]

Thanks Harold. Presume it won't get too much use.

[highwideandugly]

Merry Xmas all….great banter and cutting edge discussion all year!

Here’s to more of the same in 2024 😀

[Harold77]

Originally Posted by N707ZS

Thanks Harold. Presume it won't get too much use.

I think it will get a fair bit of use, especially by Draken. But is built big enough for larger aircraft to use, so will have a lot more scope.

[Bill Darlington]

Cargo.

would 6 tons per month be an average, I think Mme only charge £60 a ton, that's would be a very low income

Cargo 6 Tonnes
Aircraft Movements 2,245
Terminal Passengers 25,901[/QUOTE]

[Bill Darlington]

Am I right in thinking that there are, 2 flights per week less than last year, during the summer ,???

[Bill Darlington]

Airport accounts shows an amazing increase in turnover from £7m to £15m, I would like to hear views as to how this may have been achieved, considering passenger numbers have not increased substantially, an increase of £8m is huge, the accounts simply show one line stating turnover, and further info is not available due to the company not be in total public ownership.
THe nett loss was ,£5.8 and not £2m
EBITDA figures are very misleading, Warren Buffett said you should substitute BS for EBITDA, he ought to know

[P330]

Originally Posted by Bill Darlington

Am I right in thinking that there are, 2 flights per week less than last year, during the summer ,???

One less with Bulgaria being weekly. Turkey takes a break for 3-4 weeks too.

All offset by Alicante running 3 weekly over the winter so fairly flat at the moment v 2023.

[Harold77]

2021-22
Terminal Passengers 83,921
Aircraft Movements 20,130
Revenue £7,686,643
Loss -£11,882,689

2022-23
Terminal Passengers 192,283
Aircraft Movements 21,360
Cargo 14.8 tonnes
Revenue £15,575,088
Loss -£4,456,327

What happened during 2022-23:

Draken expansion
Construction of Hangar 361 and occupation with 8x Honey Badgers arriving and start operations.

2Excel 2x 727s temporary base at airport after Doncaster closed down.
Willis Aviation work builds up.

TVCA moved into Airport offices.
Property rentals.

110k extra passengers, so extra spending in shops/ cafes/ bars/ car parking.
1230 extra aircraft movements.
Cargo numbers start to be built up.
A lot more larger aircraft being handled, residential, repairs, storage and scrapped.

So a lot more income streams than the previous year.

[onion]

Interestingly the result on companies house are out.
The South Side development (joint venture) is still listed as a property development and management company with no physical asset being transferred. There is the note to state that the airport did invest £6m into this joint venture but that figure still forms part of the airports assets - note this was also in the previous years accounts so is nothing that wasn't already known about.

For me more interestingly about £5.6m of assets under construction have been transferred out of the airport.... it doesnt say where too but an educated guess would be the joint venture - this alone would of actually put the airport into profit 🤫
Add to this the fact that the buildings and runway are valued at over £40m but with depreciation amount to almost £40m as well due to a prudent approach to the situation in the aviation industry, we may see in the next couple of years a re valuation of those assets so the depreciation is shown differently.
Currently there is still a long way to go but reading between the lines and the sneaky accounting processes there is alot to be positive about!

[N707ZS]

They also haven't paid the farmer for his land on the new road. The value of that must be excessive. Hope he gets paid soon.

[Harold77]

The draw down loan facility has been boosted.

It now stands at £88m (£64.4m Airport and £23.6m Southside) of which £63.3m has been drawn down in total.

Last year the facility was £77.6m of which £44m was drawn down.

So I take it that the government funding awarded to TVCA for airport projects gets put into the loan facility to the airport, hence the boosting seen this year.

[SWBKCB]

Originally Posted by Harold77

The draw down loan facility has been boosted.

It now stands at £88m (£64.4m Airport and £23.6m Southside) of which £63.3m has been drawn down in total.

Last year the facility was £77.6m of which £44m was drawn down.

So I take it that the government funding awarded to TVCA for airport projects gets put into the loan facility to the airport, hence the boosting seen this year.

Is that right? The funding for the hangars etc were described as Grants not Loans. I'd also expect funding for a specific purpose to be held seperatley rather than going into a central fund. Of course the way the airports ownership is structured means that there is no transparency in the way taxpayers money is spent.

[SWBKCB]

Some guesses in response to H77's comments

Draken expansion
Construction of Hangar 361 and occupation with 8x Honey Badgers arriving and start operations.

Clearly a good thing. Increase in activity and good quality jobs from the additional aircraft. How was the hangar funded, I'd expect a significant contribution from TVCA/the airport?

2Excel 2x 727s temporary base at airport after Doncaster closed down.
Willis Aviation work builds up.

Again, both good things albiet 2Excel was a short term gain. It will be interesting to see how Willis develop - they are doing things at Teesside that they don't do anywhere else in their group. What happened to the Regional airliner maintenance centre that was quoted as being operational in the planning application for the new development?

TVCA moved into Airport offices.
Property rentals.

All good things, but return on investment would be interesting. Also parties and fashion shows in the terminal

110k extra passengers, so extra spending in shops/ cafes/ bars/ car parking.

A lot of money has been spent on the terminal, and getting RYR in was a coup. But it has all gone a bit flat. It's clear from RYR's behaviour that they aren't making loadsamoney, and they almost appear to be in 'contractural obligation' mode. Are the shops/cafes/bars making a return on the money spent on them? Global connectivity has gone down the list of priorities - how much would have to have been spent to keep KLM happy? I would suspect not much, so the terminal investments main benefit seems to have been to let Teessiders have a shorter journey to go on holiday - hmmm...

1230 extra aircraft movements.

I'd expect the bulk of these to be Draken and other residents who presumely pay a flat fee per year rather than per movement. Where do Draken source their fuel from? From the airport, or do they have their own supply?

Cargo numbers start to be built up.

Cargo numbers are sporadic to say the least. Based on Teesside Movements 2023 year to date figures it's 70 odd tonnes. If Bill Darlington's figure of £60 per tonne is correct, isn't paying for the cargo managers compnay car, let alone starting to repay the £3m (?) invested in cargo handling. Can only be called a disappointing start.

Unless anybody knows otherwise, all of this is Nissan related so clearly it is a good thing to be supporting one of the Northeasts biggest employers even if it is outside the TVCA area.


PS - anybody else think "Honey Badger" is the sort of nickname Michael Gove made up for himself in the hope that the big lads thought it "cool"? L-159's please!

[Bill Darlington]

Accounts

Originally Posted by Harold77

2021-22
Terminal Passengers 83,921
Aircraft Movements 20,130
Revenue £7,686,643
Loss -£11,882,689

2022-23
Terminal Passengers 192,283
Aircraft Movements 21,360
Cargo 14.8 tonnes
Revenue £15,575,088
Loss -£4,456,327

What happened during 2022-23:

Draken expansion
Construction of Hangar 361 and occupation with 8x Honey Badgers arriving and start operations.

2Excel 2x 727s temporary base at airport after Doncaster closed down.
Willis Aviation work builds up.

TVCA moved into Airport offices.
Property rentals.

110k extra passengers, so extra spending in shops/ cafes/ bars/ car parking.
1230 extra aircraft movements.
Cargo numbers start to be built up.
A lot more larger aircraft being handled, residential, repairs, storage and scrapped.

So a lot more income streams than the previous year.

Would you have an explanation for the term
Gain of financial asset at fair market value... could this mean the value of the airport has increased,the value showing is. £2.7m similar to last year
And interesting that 8 board members were replaced in 2023

[Bill Darlington]

Flights

Ryanair are having significant problems with delivery of their 737s that are on order. Boeing have stated that problems continue in manufacturing and with a shortage of planes. it's very unlikely that small regional UK airports will see much additional traffic and with aircrafts becoming ever more complicated to maintain, the need for them to be at a carrier's hub is essential, something Teesside cannot offer, so it's Newcastle that will benefit.

Teesside is the only English commercial airport without any connection to other English airports, it desperately needs a connection to London and Southampton, but they have been tried before.

it really does seem there is a huge reluctance on behalf of carriers to use Teesside, it's just not seen as a suitable airport for many reasons, so I think it will be unable to expand and it's clear that Mr Houchen is vigorously exploring different avenues. he has high hopes for the business park, but in one year he has only managed to build 1% of the proposed total, and as yet that is unoccupied.

Within the Darlington area there are well over 2 million sq ft of empty unlet warehouses, so a tough call.
The local residents are all full of praise for the airport and why not, it's quiet and user friendly, but unlikely to make any money.
How long will the TVCA be prepared to provide taxpayers funds to support it, with or without the current Mayor?

[onion]

Originally Posted by Bill Darlington

Would you have an explanation for the term
Gain of financial asset at fair market value... could this mean the value of the airport has increased,the value showing is. £2.7m similar to last year
And interesting that 8 board members were replaced in 2023

Bill if you read note 14 it explains it a little bit.
This is a likely revaluation of the investment property, e.g the fair value (done by an external group) of the property has increased. A little like you house gaining value.

[SWBKCB]

And interesting that 8 board members were replaced in 2023

Aren't most of these local councillors? Presumably the jobs get rotated.

Ryanair are having significant problems with delivery of their 737s that are on order. Boeing have stated that problems continue in manufacturing and with a shortage of planes. it's very unlikely that small regional UK airports will see much additional traffic and with aircrafts becoming ever more complicated to maintain, the need for them to be at a carrier's hub is essential, something Teesside cannot offer, so it's Newcastle that will benefit.

I think how much money is being made has more influence over how routes are allocated then these operational reasons.

[Bill Darlington]

Fair value

Originally Posted by onion

Bill if you read note 14 it explains it a little bit.
This is a likely revaluation of the investment property, e.g the fair value (done by an external group) of the property has increased. A little like you house gaining value.

Thanks for your reply, as I thought, I presume the only real asset is the airport itself, it must be that, but it appears that the figure has been used to make the loss less, would you think likewise?