Delays at all-time low as NATS posts profit

02 July 2010

NATS, the UK’s leading air navigation service provider, reported a creditable result for the financial year ended 31 March 2010 despite the difficult economic environment. The group also provided a strong operational service with air-traffic related delays reduced to an all-time low, maintained its excellent safety record and completed its two-centre strategy.

NATS Holdings Limited (“NHL”) and its subsidiaries (“the NATS group” or “NATS”) reported a turnover of £754.9m (2008/9: £767.3m), and a pre-tax profit of £78.3m (2008/9: £135.5m).

The group’s underlying profit before tax of £100.7m (2008/9: £143.9m) was £43.2m lower than the previous year reflecting the impact of the economic recession on traffic volumes and increases in operating costs, due mainly to higher pension costs and staff pay.

The results included cost savings of £20m, most of which are sustainable, that the group made in the year in response to lower traffic volumes and higher pension costs. Further savings are planned for in future which will continue to improve cost effectiveness whilst maintaining customer service. In recent years NATS has also strengthened its financial position and lowered its gearing to ensure that it remains robust to the effects of the recession and the costs of its pension scheme.

  • The last year also saw the successful delivery of the group’s strategy to reduce the number of air traffic control centres it operates from four to two. The area control centre previously based at Manchester transferred to a new centre at Prestwick in Ayrshire, in January. From this and the Swanwick centre in Hampshire, NATS controls all en route traffic in the UK.
  • Delays attributable to NATS reached an historical low at just 4.3 seconds per flight compared to 19.3 seconds last year. This was achieved with improved operational performance but was also helped by lower traffic volumes. For the second successive year, there were no risk-bearing airprox attributable to NATS.
  • Good progress was also made on the first functional airspace block (FAB) to be set up in European airspace, with the UK and Ireland seeking to enhance benefits and efficiencies from managing the combined UK and Irish airspace.


Richard Deakin

Chief Executive Richard Deakin, who joined the business in April, said: “I’ve been very impressed by the competence and hard work I’ve seen at NATS and with the focus on providing an excellent service to customers.

“Our cost-saving programme is ongoing and necessary to ensure we can offer an even more cost effective service in response to this economic recession, while continuing to improve safety, service performance and reducing the environmental impact of aviation.”

Richard added that within two weeks of arriving, he was working with others across the industry in dealing with the impact of the volcanic ash cloud on UK airspace. The airspace restrictions meant a 21% reduction in flights for April 2010 alone (compared with 2009 figures) and the industry has suffered intermittent disruptions since then. NATS estimates its revenue loss to be £5m.

NERL, NATS’ economically regulated subsidiary, reported a profit before tax of £54.9m (2009: £66.8m). The result included exceptional charges of £20.2m (2009: £51.2m). Before these exceptional items, the underlying result was a profit of £75.1m (2009: £118.0m), £42.9m lower than previously reflecting the impact of lower traffic volumes on revenues and higher pension costs and pay, which offset the benefits of the cost savings achieved and lower finance costs.

The Civil Aviation Authority (CAA), the economic regulator, is currently reviewing NERL’s charges for the 4 year period starting on 1 January 2011 and published its proposals on these in May 2010.  NATS is studying the proposals carefully and will respond accordingly during the consultation period. The CAA will reach its final decision on NERL’s charges in December 2010.

NATS Services reported a profit before tax of £23.3m (2009: £68.4m), including exceptional charges of £2.1m (2009: net exceptional income £42.8m). Before these exceptional items, the underlying result was a profit of £25.4m (2009: £25.6m), almost in line with prior year as improved revenues offset operating cost pressures.

Financial years ended 31 March 2006 2007 2008 2009 2010
Flights handled 2,330,589 2,405,573 2,480,004 2,371,624 2,172,025
Delay seconds (attributable to NATS) 22.2 22.6 26.8 19.3 4.3
Safety (airprox1)- where NATS is providing service- NATS attributable

– Risk bearing











NATS Group profit before tax (£) 80.3m 94.4m 66.7m 135.5m 78.3m
NATS Group net debt (£) 598.5m 577.3m 538.1m 480.3m 519.7m

1. An Airprox is a situation in which, in the opinion of a pilot or a controller, the distance between aircraft as well as their relative positions and speed have been such that the safety of the aircraft involved was or may have been compromised.

Notes to Editors:

The accounts of NATS Holdings Limited, and its subsidiaries, including NATS (En Route) plc, were approved by the Board on 1 July 2010 and are subject to formal adoption by shareholders at the Annual General Meeting to be held on 29 July 2010. The accounts will be available at from 0700 on Friday 2 July, 2010

NATS Holdings Limited is the parent company of the NATS group. NATS (En Route) plc is the economically regulated subsidiary providing air traffic management services from two en route centres at Swanwick and Prestwick. Income for its principal regulated service (UK en route services) is determined by an annual adjustment to charges under an RPI minus “X” economic regulatory formula, with RPI being the rate reported for August. NATS (Services) Limited is not economically regulated and provides air traffic control support at 15 major UK airports and one overseas (Gibraltar); as well as selling commercial engineering, training, consultancy, airport data management and other services.

NATS Holdings Limited operates through a Private Public Partnership (PPP) and is owned by the UK Government (48.9%); The Airline Group (41.9%); BAA (4.2%) and the NATS Employee Sharetrust (5.0%). The Airline Group is a consortium of seven UK airlines including British Airways, bmi, Thomson Airways, easyJet, Monarch, Thomas Cook Airlines and Virgin Atlantic.

NATS handled nearly 2.2 million flights in 2009/10, covering the UK and eastern North Atlantic and carried more than 200 million passengers safely through some of the busiest and most complex airspace in the world.


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