BAA Passengers Down 10 Percent, Loss Widens

British airports operator BAA saw a 10 percent drop in passenger numbers and suffered a sharply higher loss in the first quarter, the company said on Tuesday, as the recession hit air travel.

The operator of London's Heathrow and Gatwick airports said its outlook in terms of passenger numbers was "slightly more cautious" than its previous forecast, but reiterated its hopes for a rise in underlying profit this year on a strong retail performance.

The unit of Spain's Ferrovial said its pre-tax loss reached GBP316.2 million pounds (USD$469.8 million) after one-off costs from building Heathrow's Terminal 5 and from losses on derivatives contracts, compared with a loss of GBP55.6 million in the same period last year.

Revenue rose 15.5 percent.

Passenger numbers dropped 10 percent to 24.8 million with Gatwick and Stansted airports falling the most at 14.6 percent each.

It also said the planned sale of Gatwick was due to be announced within weeks.

Gatwick airport was put up for sale last year to meet competition concerns and BAA was subsequently also ordered to sell London's Stansted and either Edinburgh or Glasgow airports in Scotland.

Parent Ferrovial is expected to post a 5.7 percent drop in first-quarter core earnings after the market in Madrid closes on Tuesday, pressured by a drop in traffic at its airports and motorways as well as high financial costs.