Financial Reports for London Luton Airport, Year 2019/20

The Financial Year for LLAL runs April-March and accounts are normally online for inspection in August/September. It is from this account that the public can see how much commercial income LLAL has received on behalf of Luton Borough Council (LBC) from the airport concessionaire.  It also details the charitable donations and the dividend the LLAL Board has actually decided to pay LBC for its service budgets.

It is now a full Financial Year since those accounts should have been ratified and eight months since they should have been published.  Recognising the effects of Covid-19 on the approximately 4.3 million businesses that file accounts with Companies House last March the Government gave an extra three months leeway for filing, yet on the LLAL filing history page there is now a large “accounts overdue” marker.  When you consider that (apart from March 2020 which is when Covid first became an issue to aviation), the accounts were all but complete for registering;  why have they not been filed?

Maybe it is because the passenger throughput for 2019/20 year at Luton Airport was 17,457,093, up 300,000 on 2018/19.  In 2018/19 the concession income was £49.960 million, so on the same ratio would have been £50.8 million for 2019/20, the year we are waiting for.  

Have the accounts been delayed in filing because it would have caused issues with LBC’s pleas to Central Government for emergency funding?  It seems strange that the figure asked for by LBC for this and the next financial year is the same amount they should have received for 2019/20.  This money is real cash it exists and after the taxman.  It is all LBC’s income.  Why were LBC so quick to plead poverty when that sum was available to their bank account?  

For the year just closed we can see the passenger throughput fell to circa 2.9 million, a figure not seen since the mid-1990s, before the advent of EasyJet at Luton and we can understand that has caused financial issues.   We also have to consider that in the airport operator, London Luton Airport Operations Ltd, accounts for 2020, shows that all the Force Majeure costs since March have fallen on the shoulders of LLAL/LBC.  No exact figures are shown but it could be the LLAL accounts will show that all of the concession income was kept by the operator for that reason?

Another reason could be the same as why the LBC accounts are also not available in an audited state and this is taken from the LBC website:-   The external audit of the draft statement of accounts for the year ended 31 March 2020 has not yet been completed by our external auditors, EY LLP, as the Council are updating the unaudited 2018-2019 financial statements to recognise the accounting judgements and disclosures arising from the Covid-19 pandemic on events after the reporting period and going concern which impact on both the Council’s and its wholly owned subsidiary, London Luton Airport Limited. EY LLP then need to conclude their quality assurance and professional practice consultations on the Council’s accounting judgements, disclosures and their final audit report.”

The LBC auditors have noted in recent reports the difficulties the public and elected members of LBC would have in finding and following audit trails on LLAL projects, the DART and its Development Consent Order programme. The auditors for LLAL were also due last year to review the valuation of the airport.  Previous valuations were based on future performance based on recent years and an accurate valuation was thought prudent. 

Could another reason why the Financial Accounts have not been filed be because the auditors have now concluded that LLAL is an insolvent company as its debts are now on a par, or greater than its true real time worth?  If this were to be the case then questions would have to be answered as to why that was allowed to happen, and not scoped into plans? 

It is a criminal offence under the Companies Act for Board members and company officers not to file accounts on time, and as all are Councillors or employees of LBC, does that open up the prospect of yet more diversion of public funds to cover legal costs should legal action happen?

In line with the majority of articles we bring to our readers’ attention, we have more questions than answers. Requests to LBC for clarification on anything to do with LLAL normally fall on deaf ears; or there is a response laden with PR soundbites, then a silence to any further questions

We will monitor the Companies House website for the accounts to be submitted, and will update you when they arrive.

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