London’s Air Ambulance rescued by Banco Santander?

London’s Air Ambulance rescued by Banco Santander?

8-Feb-2011 Source:

London’s Air Ambulance (“LAA”) has announced that it has secured financing on its MD Explorer helicopter for the next seven years.  The deal, financed through Santander Corporate Banking, and with the support of Virgin Group, will enable the Charity to concentrate its efforts on continuing to develop its service.  It has also appointed Banco Santander as its primary bankers.  Neither LAA or Santander would comment on the financial amounts involved, and from the wording they released, it’s not clear if it’s just a better finance deal on the helicopter or hard cash.

Since inception in 1988, LAA has completed 24,733 missions (correct to 4th February), including 1,979 in the year 2010.  However, these figures hide the fact that a good proportion of these were achieved by car and not the helicopter! In the year to 31st March 2010, LAA treated 1,726 patients, 651 by helicopter and 1,075 by car.  The car service went 24×7 the next month, and it is assumed that this will reduce the proportion of patients treated by the MD Explorer, the operational hours (7.30am to 8pm, or dusk if earlier) have not changed significantly for many years.

LAA has taken a different funding approach to all other UK EMS operators, targetting corporate money from the start when they launched with a 365N Dauphin under the sponsorship of Express Newspapers.  For many years now, Virgin Group have sponsored the LAA and been the largest logo on the side of the aircraft.  Many people, both in and outside the industry, believe the Explorer is fully corporately funded, and this incorrect perception makes further charitable fundraising all the more difficult – we understand Virgin’s funding is just £200K per annum.  All the other UK air amublances have put their efforts into local charitable fundraising within the geographical area that they serve, often with a chain of retail shops and a lottery, with much less credance given over to corporate sponsorship,

Over the years, LAA’s profile in the UK EMS market has been lacklustre, and to demonstrate this compared LAA and Devon Air Ambulance.

London started operations in 1988 and its accounts for the year to 31 March 2010 show a turnover of £2.28M and spending of £2.31M, plus cash reserves of £195K including £159K allocated to a maintenance reserve fund for their MD Explorer.  Over half of their turnover comes from the National Health Service.  Total accumulated funds after 23 years of operation show a shortfall of £164K, compared to a shortfall of £134K the previous year. understands that Virgin Group intend to continue their support at £200K per annum, and note that the London Stock Exchange announced in April 2010 that they would support LAA with £200K over two years.

By comparison, Devon Air Ambulance was established in 1984 in a rural county with a population of 1.14 million – approx 15% of London’s headcount – and an area where the average income well below that of the UK’s capital city.  Devon Air Ambulance shows just what is capable by a charitable EMS operation without a focus on corporate sponsorship – in the year to 31-Dec-09 their accounts record an income of £4.53M, costs of £3.86M and cash (bank accounts and short-term investments) of £3.84M – plus they bought one of their two Eurocopter EC135s outright for cash in 2008.

The difference between these two is shocking.  The rural county of Devon has made significant progress, operates two helicopters and has sizeable reserves.  London, over six times the population of Devon, operates one helicopter and is technically insolvent.  Let’s hope that this new input from Santander helps LAA to put this to rights.

Further reading:-

Accounts for London Air Ambulance for year to 31-Mar-10

Accounts for Devon Air Ambulance for year to 31-Dec-09

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