There has been media coverage and misleading commentary around publication of our annual accounts for 2021/22.
Cllr Javeria Hussain, Chair of Luton Rising, said:
“I want to reassure everyone that our airport company is absolutely stable, recovery from the pandemic is ahead of schedule, the future is optimistic, and we continue to remain focused on making a positive social impact and improving lives across our town through investing in our local communities.
“The 2021 /22 annual accounts cover a period when we were in a global pandemic which catastrophically impacted aviation. People will remember that flights were grounded and one of our major sources of income was taken away. But already revenues are on track to return to pre-pandemic levels.
“The ‘loss’ of £232m being reported is mostly a year-on-year adjustment to the valuation of the airport. This is a complex calculation involving many subjective assumptions about future operating conditions. Our Board commissioned experts at one of the ‘top four’ accounting firms to prepare the valuation, and it is entitled to rely on their expertise.
“While there is a difference in opinion on the exact figure, we must remember that the valuation of the airport has increased from £530m to approximately £1.3bn as a result of the work we have done, as a responsible owner, to stabilise and protect our community asset during and immediately following Covid-19.
“The ‘loss’ also includes an amount of deferred taxation, another non-cash item affecting the balance sheet but which is required by accounting rules to be passed through the profit and loss account.
“The actual operating loss for 2021/22 was £15m, compared to £20m the previous year – hardly surprising given that the company’s revenues were severely depressed while the aviation industry was very slowly recovering as Covid restrictions were lifted and consumer confidence in international travel returned. These losses were covered by the company’s accumulated reserves.
“When our airport had virtually no passengers and no income in 2020 and 2021, we had to acknowledge that it was temporarily stricken.
“What would we do? Doing nothing would have been truly irresponsible, and we would have failed the local communities of Luton to whom our airport ultimately belongs.
“Instead we decided to invest to start earning again as soon as possible – that is what a responsible owner does. We knew that we would have to take out a loan, but also that we would be able to repay it. The annual accounts reflect this decision.
“Our ownership of London Luton Airport has provided half a billion pounds of benefit to Luton over the last 25 years. Frontline services, charities who support our most vulnerable people, the arts and culture, sport and physical activity, plus a multitude of community celebrations in Luton, all depend on our airport’s success and we are not giving up on it just because the going got tough.”
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