NATS-Annual-Report-2015

Annual Report and Accounts 2015 | NATS Holdings Limited
Strategic Report
37
Review of service
line performance
Service line performance
We organise our activities according to service lines, which
reflect the products and services that we offer. A brief
description is provided under the section entitled ‘Our
business model’. This section explains the financial and
operational performance of each service. The principal
financial measures are revenue and contribution. The
former includes intra-group revenue, while the latter reflects
the operating costs which managers are able to influence
directly. A reconciliation of service line contribution to the
group’s operating profit is provided in the notes to the
financial statements.
NATS Airspace
2015 2014
Financial performance:
Revenue (£m) 738.5 740.7
Service line contribution (£m) 380.2 391.6
Capital expenditure (£m) 152.3 125.5
Operational performance:
Flights handled (‘000s) 2,216 2,162
Risk-bearing airprox (no.) 1 1
Average delay per flight (seconds) 2.2 5.4
Enabled fuel savings (tonnes) 189,000 21,000*
* restated
NATS Airspace includes all of NERL’s economically
regulated activities. It generated revenue of £738.5m, a
0.3% reduction on the previous year. This included the
impact of RP2 price reductions from January 2015 which
offset an improved service incentive and the impact of
pricing below the level of permitted revenue allowances in
2014. Last year’s income also included a one-off benefit for
the back-up Galileo satellite monitoring facility at Swanwick.
Service line contribution of £380.2m was 2.9% lower and
reflected higher budgeted pension costs (used in assessing
service line performance only and reflecting market
conditions when the budget was set), pay awards and nonstaff
cost increases which offset the benefit of headcount
reductions and higher capitalised internal labour.
Airspace: average Airspace: delay average per flight delay per in seconds flight in seconds
40
30
20
10
0
20.5
21.7 22.2
25.1
The level of delay attributable to NATS Airspace for
the financial year was 2.2 seconds per flight (2014: 5.4
seconds), with 99.8% of flights not delayed (2014: 99.7%).
Each of the CAA’s delay targets was met, including the
impact of the December technical failure. This outperformance
earned a service incentive of £5.7m (2014:
penalty £1.0m). Overall, this was a good performance in
a year which included the operational challenges of the
Commonwealth Games and a NATO Summit in the UK.
In addition to measures of delay, we are targeted on
flight efficiency (the environmental performance of our
18.8
4.2 4.2
2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15
CP3 metrics: 2014 calendar year
Target adjusted
for traffic Actual
T1: avg. delay per flight (secs) 8.3 2.2
T2: delay impact (score) 23.4 4.2
T3: delay variability (score) 1,400.3 195.2
T4: 3Di metric (score) 23.0 23.2
7.0
1.3
5.4
2.2
Strategic Report