Latest update: 29/10/2010
British Airways beats ash and strikes with first profit in 2 years
British Airways has reported a net profit of 107 million pounds in the six months to September, its first half-year profit since 2008, despite weeks of cabin crew strikes and the fallout from Iceland's volcanic ash cloud.
By NEWS WIRES (text)
AP - British Airways on Friday reported a half-year net profit of 107 million pounds ($170 million) as cost cuts helped offset the impact of cabin crew strikes and nearly a week of canceled flights in April because of the Icelandic volcano.
The profit for the six months to Sept. 30 was the first since 2008. A year earlier, BA had reported a loss of 217 million pounds for the comparable period.
Revenue rose 8.4 percent to 4.45 billion pounds; passenger revenue was up 7.9 percent to 3.88 billion pounds while capacity was reduced by 6.2 percent. Cargo revenue jumped 39 percent to 350 million pounds.
BA shares were down 0.3 percent at 280 pence in early trading on the London Stock Exchange.
The carrier said it posted an operating profit of 370 million pounds in the second quarter, compared with a loss of 17 million pounds a year earlier, but it did not detail quarterly net earnings.
For the six months, BA’s operating profit was 298 million pounds compared with a loss of 111 million pounds.
“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,” said Chief Executive Willie Walsh.
“Revenue has increased, driven primarily by yield improvements and, while fuel costs have risen, they are in line with our expectations.”
BA said it would not pay a dividend for the first half.
Walsh said BA expects to conclude its merger with Spanish airline Iberia in January, a combination expected to save the partners 350 million pounds by the fifth year.