BAA to spend £1bn a year on upgrades
25.06.10
BAA said yesterday that Heathrow's capital investment program will see it spend of around £1bn a year over the 5 years to March 31 2013. Total expenditure in period is expected to be within the original £5.14bn cost figure implied by the CAA settlement, which determines future tariffs charged to airlines using the hub.
Lower than forecast inflation in the first 2 years of the current 5 year review period has enabled scope to be added to the capital investment program (£4,736m in 2007/08 prices compared to £4,542m in the CAA settlement) whilst remaining within forecast total cost, BAA said.
The company also confirmed that the overall investment program for the period is making satisfactory progress. By February 2010, 10 of the 24 capital investment trigger projects had been completed. Based on forecast project completion dates for all trigger projects, it is expected that aeronautical income will be adjusted by £42m (in 2007/08 prices) over the regulatory period to reflect re-phasing of investment compared to that anticipated by the CAA at the time of the March 2008 settlement.
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