BMI retains trade sales despite cuts

BMI’S travel trade sales have held up despite its decision to scrap agent commission last October.

The UK airline carried 10.5 million passengers last year, the same as in 2004, and travel agents retained their 54% share of seats sold.

BMI expects a 50/50 split between trade and direct sales in 2006, but a spokesman said trade sales may actually grow because of BMI¹s push for high-yield business travel typically sold through travel management companies.

“The percentage of our sales that come through the travel trade is still very significant,” said deputy chief executive Tim Bye. “There is a gradual movement downwards because of people going direct, but agent sales are still important to us, and that will not change.”

BMI’s results for the year ended December 31, 2005, released on Tuesday, showed pre-tax profits quadrupled to £10 million, a 4.7% increase in turnover to £869 million.

Chief executive Nigel Turner would not reveal BMI’s operating margin or yield figures although he did say he did not want BMI to do any worse than British Airways’ target of a 10% operating margin by 2008.

“We did not chase volume last year. We have tried to work smarter. We have focused the business on building profitable routes aimed at profitable passengers,” Turner said.

BMI will start flying twice daily to Russia, in partnership with Transaero, in 2006 following last week¹s signing of a new UK-Russian aviation agreement. BMI is looking at flying into Domodedovo International Airport in Moscow.