Growth Slows, Profits Climb
Manchester and London Stansted Airports Report Slower Passenger Growth but Higher Profits and New Records
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Manchester Airports Group (MAG) posted record passenger numbers for the year to March 31, 2026 — but growth slowed sharply, falling to just 1.9% from 6% the year before, according to The Bolton News. Total passengers across the group reached 66.3 million, well below the pace of previous years.
Despite the slowdown, pre-tax profits rose 4.5% to £227.4 million. MAG CEO Ken O'Toole said the group showed "resilience" in the face of "heightened geopolitical and economic uncertainty." Two forces drove the pullback: a spike in jet fuel costs after the February 2026 US-Iran conflict, and a UK government doubling of business rates for airports.
Manchester and Stansted Hit Records but Miss Forecasts
Manchester Airport carried 32.3 million passengers — a record, but growth of just 3.6%, far short of the 8% forecast, according to Herald Scotland. London Stansted crossed 30 million passengers for the first time, joining what MAG calls the "30 Million Club." Its growth, however, nearly stalled at just 0.4%, down from 4.9% the year before.
East Midlands Airport, MAG's third airport, shrank. It carried 4.0 million passengers, a fall of 1.3%. Across the group, the pattern was the same: absolute numbers were at all-time highs, but the rate of growth collapsed, according to The Westmorland Gazette.
Iran Conflict and Airspace Closures Squeeze Airlines
The US-Iran conflict, which broke out on February 28, 2026, hit aviation hard. Middle Eastern airspace closed. The Strait of Hormuz — through which 20% of the world's oil passes — was heavily restricted. Jet fuel prices surged. The gap between crude oil and refined jet fuel nearly tripled compared to 2025 levels.
Long-haul flights between Europe and Asia had to reroute, burning more fuel and pushing up costs. By May 2026, global air travel demand had fallen 2.2% year-on-year, according to the International Air Transport Association (IATA). IATA's Director General Willie Walsh warned that airlines "operating on a 2% margin will have little choice but to continue testing demand resilience with higher fares."
Business Rates Doubled, MAG Warns of Investment Risk
On top of the geopolitical shock, UK Chancellor Rachel Reeves delivered a second blow in the November 2025 Budget. Airport business rates more than doubled. Manchester Airport's annual bill is set to rise by £4.2 million to £18.1 million, according to The Telegraph and Argus.
MAG is now reviewing its planned £2 billion, five-year investment program. That plan includes the final stages of Manchester's Terminal 2 transformation and an expansion at Stansted to a 51-million passenger capacity. CEO O'Toole has warned that the business rates rise is a "tax on growth" that makes large capital projects harder to justify.
Profits Hold Up as Ticket Prices Set to Rise
Despite all the headwinds, MAG stayed profitable. Pre-tax profit rose 4.5% to £227.4 million, and group revenue grew an estimated 12.8% to around £1.3 billion, according to South Wales Guardian. Load factors — the share of seats actually filled on flights — hit a record high of 83.8% globally, which helped airlines stay in the black.
Passengers should expect to pay more. IATA and MAG have both signaled that higher fuel costs and business rate increases will be passed on through ticket prices. Analysts predict "meaningful" fare hikes for the 2026 summer travel season, according to NW Email.
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