December 2025 Investor Report

Heathrow

19 December 2025

 

19 December 2025

Heathrow Funding Limited

Heathrow Finance plc

Publication of December 2025 Investor Report

On behalf of Heathrow Airport Limited, Heathrow Express Operating Company Limited, Heathrow (AH) Limited and Heathrow (SP) Limited ("Heathrow SP"), LHR Airports Limited (as Security Group Agent) is today distributing its semi-annual Investor Report to various parties pursuant to the terms of the Common Terms Agreement entered into on 18 August 2008 (as amended) (the "CTA").

The Investor Report is also being distributed by Heathrow Finance plc ("Heathrow Finance") to various parties pursuant to Heathrow Finance's £275 million 3.875% Senior Secured Notes dated 5 June 2017 and due 2027, the £300 million 4.125% Senior Secured Notes dated 15 November 2019 and due 2029 and the £400 million 6.625% Senior Secured Notes dated 19 March 2024 and due 2031  (the "Heathrow Finance Bonds"), a note purchase agreement dated 14 September 2018 (the "Note Purchase Agreement") and pursuant to Heathrow Finance's facilities agreements dated 22 November 2018, 23 November 2018, 1 February 2019, 8 May 2019, 16 August 2019 and 2 December 2019 (the "Heathrow Finance Facilities Agreements").

The Investor Report contains information relevant to creditors of both Heathrow SP (and its subsidiaries) and Heathrow Finance.

The attention of potential readers of the Investor Report is drawn to page 2 of the document, which contains an Important Notice, including in relation to certain forward-looking statements included in the Investor Report, and contains a description of the basis on which the operational and financial information included in the document has been prepared.

The Investor Report includes an updated forecast for 2025 and 2026 for the financial performance of Heathrow SP prepared on a consolidated basis, forecast nominal debt and financial ratios for Heathrow SP and Heathrow Finance. Heathrow SP, through its indirect subsidiary, Heathrow Airport Limited, owns Heathrow Airport.

This report sets out the actual financial performance and ratios for Heathrow (SP) in 2024 and forecast figures for 2025 and 2026, together with key business updates. Additional information specific to Heathrow Finance is set out in Appendix 6.

In the 11 months to November 2025, we have seen record traffic numbers at Heathrow with 77.3 million passengers travelling through the airport. For 2025, we forecast an increase in passenger traffic of 84.3 million (+0.5 vs FY24) - an incremental increase from the June Investor Report forecast driven by a record-breaking summer and a strong start to the winter season. We expect a further uplift to 85 million passengers in 2026 with the benefit of increased seat capacity however, demand is already outpacing the limits of current infrastructure reinforcing the urgency to deliver the improvements outlined in the H8 Business Plan.

We have continued to maintain and improve on our operational performance metrics. We remain the most punctual hub airport in Europe with 78.7% of arrivals and 77.4% of departures within 15 minutes of schedule (2024: 67.9% and 69.0%). We also achieved 98.2% of queue times in Central Search Areas under five minutes (2024: 95.3%).

2025 revenue is forecast to improve versus the June 2025 Investor Report driven by increased traffic numbers and higher yielding traffic mix with supporting non-aeronautical revenue from retail income as well as growth in parking and property. Adjusted EBITDA¹ remains under pressure and forecast to decline by 0.8% to £2,019 million due to headwinds associated with higher than inflation costs to serve the pick-up in passenger numbers albeit an increase from the forecast in June 2025 Investor Report. In 2026, 1.8% growth in revenues are offset by higher operating costs linked to employment costs and business rates resulting in a decline in Adjusted EBITDA to £1,941 million. 

We improved air quality and reduced carbon emissions with a new pre-conditioned air system at Terminal 5, upgraded our Carbon Management Standard and contributed to a report on how hydrogen-powered aircraft can cut carbon emissions. We provided evidence to support the SAF Bill's progress in UK Parliament and signed up for a UK government sponsored "Green Concrete" initiative to develop low carbon concrete.

We forecast capex for the H7 period to increase to £4.7 billion (£1,215 million for 2025 and £1,315 million for 2026) delivering on our Next-Generation Security projects, new baggage systems, carbon reduction initiatives and service enhancements whilst continuing to strengthen our operational resilience.

We submitted our H8 business plan in July 2025, outlining a £10bn investment programme (including £0.5 bn capital efficiencies), 6% saving across the operating cost base while delivering total EBITDA benefits of £1.1 bn. It includes 15 customer focused outcomes over the H8 period. The plan is under CAA review, with Initial Proposals from the regulator due in March 2026. Heathrow has held three rounds of constructive engagement with airlines, with a final round planned for April-May 2026 to further discuss and seek alignment on the Initial Proposals.   

We submitted our Expanding Heathrow proposal to Government in July to secure long-term capacity growth. In October, Government requested further details and launched the Airports National Policy Statement ("ANPS") review, with public consultation expected by July 2026. In November, Heathrow's proposal was chosen as the scheme to take forwards expansion and will be used as the basis for the ANPS review. 

In late 2025, the CAA set out its approach to recovering early costs for Heathrow's capacity expansion. Efficiently incurred costs in 2025-2026 including property and enabling works will be recoverable after an ex-post review in 2027, capped at £320 million (2024 CPI prices) with scope for adjustment. Recovery will apply even if Heathrow withdraws for genuine business reasons, and the CAA is minded to allow recovery of early costs incurred by Arora Group/Heathrow West Limited up to November 2025. Responses to the consultation are due January 2026.

In the meantime, the CAA is also developing the regulatory framework for Heathrow's expansion. Its November 2025 paper sets out a framework for assessing regulatory models for expansion, with reference to six key criteria including those related to timely delivery, cost efficiency, financeability, practical implementation, promotion of effective competition and service quality. It also outlines a "long-list" of potential models using 9 initial categories, yet to be tested from a legal and operational perspective. Heathrow will respond by January 2026, with further consultations expected in spring and conclusions in summer.

The Investor Report document is available in pdf format at the following link:

http://www.rns-pdf.londonstockexchange.com/rns/2051M_1-2025-12-18.pdf

The Investor Report is available from today via the Heathrow Investor Centre at https://www.heathrow.com/company/investor-centre/reports/investor-reports

By way of reminder, pursuant to the CTA, the Heathrow Finance Bonds, Note Purchase Agreement and the Heathrow Finance Facilities Agreements (as appropriate), the following is available on the Heathrow Investor Centre at https://www.heathrow.com/company/investor-centre/reports/annual-accounts:

-     consolidated financial statements of Heathrow (SP) Limited for the six months ended 30 June 2025.

-     consolidated financial statements of Heathrow Funding Limited for the six months ended 30 June 2025.

-     consolidated financial statements of Heathrow Finance plc for the six month ended 30 June 2025.

For investor enquiries please contact Wendy Butler, Debt Investor Relations Manager, [phone].

¹ Adjusted EBITDA is earnings before interest, tax, depreciation and amortisation, and exceptional items

 

END