BA set to make record annual losses
Thursday, 05 Feb, 2010
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A deeper pre-tax loss of £342 million was recorded by British Airways today for the nine months ending December 31, 2009.
This compared with a loss before tax of £70 million in the same period in 2008.
Revenue in the period was down by almost 13%.
However, the third quarter of the airline’s financial year showed an improvement with a pre-tax loss of £50 million against a £122 million loss the same period the previous year
BA chief executive Willie Walsh said: “These results highlight the impact of permanent changes across the company on our costs.
“Those changes, combined with capacity reductions and external spending cuts, mean operating costs are down by 10.5% and show that we’ve adapted quickly to the new business realities created by the global recession.”
He added: “While we are on the right track, we still expect to make record losses this year. Permanent structural change is being introduced in all areas and will return us to sustained profitability.
“We are working with our staff, their unions and the trustees about solutions to address our £3.7 billion pension funds’ deficit and are discussing a range of changes to future pension benefits.
“In November, we signed a binding Memorandum of Understanding with Iberia for a proposed merger and are on track to finalise the merger agreement by the end of the year.
“We remain confident of receiving regulatory approval for our proposed transatlantic joint business with American Airline and Iberia.
“We continue to invest in new products for our customers.
He added: “While we are on the right track, we still expect to make record losses this year. Permanent structural change is being introduced in all areas and will return us to sustained profitability.
“We are working with our staff, their unions and the trustees about solutions to address our £3.7 billion pension funds’ deficit and are discussing a range of changes to future pension benefits.
“In November, we signed a binding Memorandum of Understanding with Iberia for a proposed merger and are on track to finalise the merger agreement by the end of the year.
“We remain confident of receiving regulatory approval for our proposed transatlantic joint business with American Airline and Iberia.
“We continue to invest in new products for our customers.
“Next week, our new First class cabin takes to the skies onboard a Boeing 777 flying to New York JFK. The investment in First this spring strengthens our progress towards being the leading global premium airline.”
by Phil Davies
Phil Davies
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