BA reports first profit in two years
British Airways has reported its first half-year profit in two years.
The airline achieved a profit of £158 million in the six months to September 30, despite being hit by cabin crew strikes and the volcanic ash cloud disruption.
The profit was double the amount analysts had been predicting and compared with half-year losses of £292 million in 2009.
Total revenue for the period was up 8.4%, passenger revenue was up 7.9%, on capacity down 6.2%.
Yields improved by 17.2%, 14.4%, excluding the impact of exchange, driven by price and mix across all cabins.
Chief executive Willie Walsh said: “Our concerted efforts to introduce permanent structural change across the airline has led to a reduction in non-fuel costs and a return to profitability.
“Revenue has increased, driven primarily by yield improvements and, while fuel costs have risen, they are in line with our expectations.
“Our focus on permanent structural change will continue. This summer we agreed a new productivity deal with our Heathrow terminal-based staff that will provide a more flexible, cost-efficient and customer focused ground operation. In addition, the first of the cabin crew recruited on new terms and conditions have completed training and start flying on Monday.”
Looking forward, the airline said it would continue to focus on managing costs.
“While positive, the economic environment continues to be subject to uncertainty, to which the increase in APD is unhelpful,” said the statement.
BA’s merger with Iberia is expected to be completed in January.
Following the merger, Walsh will become chief executive of the combined company and his basic pay will rise 12% to £825,000 a year.
He will also be eligible for performance-related bonuses of up to £1.65 million.
BA chief financial officer Keith Williams will see his basic pay rise 43% to £630,000 after being promoted to BA chief executive within the merged company.
By Bev Fearis
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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