ROUGH LANDING: Future uncertain for Ballina airport
THE next two years look bleak for the Ballina Byron Gateway Airport, with passenger numbers and income expected to drop dramatically in the wake of the coronavirus pandemic.
A new long term financial plan for the council-owned airport will be presented to Ballina Shire councillors at a commercial services committee meeting tonight.
After Jetstar and Virgin canned flights to and from Ballina, and QantasLink delayed its new Sydney service, FlyPelican is now the only airline currently operating from the airport, with flights to Newcastle twice a week.
Passenger numbers are expected to reach 475,000 this financial year, but only 200,000 in 2020/21 and 400,000 in 2021/22.
Figures similar to the pre-COVID crisis are not expected to return until the 2022/23 financial year.
And because airlines pay the airport for every person that flies in or out of the area, the airport's income has significantly dried out.
According to the financial plan, the airport's cash operating surplus is expected to reduce from $2.066m to $1.269m this financial year.
It also forecasts a deficit of $896,000 in 2020/21, but with many variables still unknown, this forecast is, at best, an educated guess.
That figure represents a negative turnaround of close to $3 million.
Ballina Shire Mayor David Wright said the council was aware of how risky the airport operations were as a business.
"We went through the collapse of Ansett, the numbers dropped by half," he said.
"(The airport) is a stand-alone business, and it doesn't actually impact at all on council's works, it's completely independent.
"We were only taking a small dividend (from the airport) to help our bottom line, but we stopped doing that."
The long term financial plan includes the retention of permanent staff will at the airport.
"It is assumed that the BBGA will be operating daily during 2020/21 and no change is
included in staffing levels," the report states.
The council borrows money from banks to finance the airport's expansion and upgrade projects.
The first stage of a multi-million dollar expansion of the airport was completed in October 2019.
The works cost $6.9 million and the council contributed $2.4 million to the project.
In terms of the forecast overdrawn balance for 2020/21, the report states that the airport's debt could soar to $832,300 for 2021/22.
The report states that if the estimation is correct, this "leaves council financially at risk if the financial performance does not improve as forecast".
A plan to borrow an extra $2 million in the next financial year "does not help", but would be used to pay for "essential works" such as the car park expansion, solar power and integration with the new Airport Boulevard.