Airport bosses plan to spend almost £1 billion on Gatwick during the next decade despite a recent slump in profits.

They say the airport must develop to cope with an estimated 42 million passengers a year - 12 million more than at present - even though a second runway would not be built until 2019 at the earliest.

Roger Cato, managing director of BAA, which runs Gatwick, said: "It is a big sign of the confidence we have in the airport's future."

BAA will invest £80 million on segregating and improving the walkways leading to the planes, £60 million on an extension to the South Terminal, £80 million on an extension to the North Terminal and £65 million on car park improvements.

A new mid-field satellite or mini-terminal will cost a further £250 million.

Mr Cato said the Government's recent consultation document on airport growth made it clear the first priority would be to get the best use out of the airport's existing capacity.

The document set out options for extra runway capacity at Heathrow and Stansted but not Gatwick because a legal agreement signed in 1979 prevented development of a second runway before 2019.

Mr Cato said: "The document does suggest potential for Gatwick to continue to grow to handle 46 million passengers a year with its single runway.

"That is an airport of significant size, continuing to generate jobs for the future and driving economic benefits for the area."

It was now important Gatwick attracted the right mix of airlines to serve its passengers.

Many local campaigners, MPs and councillors welcomed the news there would be no second runway at Gatwick but they were keen this should not stop the airport from growing.

Councillor Chris Redmayne, leader of Crawley Borough Council, said: "I am glad BAA has made this statement because it is the sort of thing we need.

"Any major investment in jobs is sending the right message to businesses."

Mark Froud, chief executive of Sussex Enterprise, said: "The importance of Gatwick in maintaining its position as one of the most efficient single runway airports in the world is undeniable.

"Our economy needs a successful Gatwick serving the widest needs of businesses and consumers in the region."