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British Airways sees £164 million loss

Strikes by cabin crew and the Icelandic volcanic ash disruption have resulted in a quarterly pre-tax loss of £164 million for British Airways.

 

Chief executive Willie Walsh, confirmed as a keynote speaker at this year’s Travel Convention in October, said: “The impact of all disruptions was in line with previous estimates, some £250 million in the quarter.” 

 

The operating loss for the three months to June 30 was £72 million, an improvement on the £94 million figure a year earlier.

Without the disruption during the period, passenger revenue would have increased by some 11% year on year.

But BA forecast that it would do no more than break even at the end of its financial year.

“While some economic experts are flagging the risk of a ‘double dip’ recession, the steady recovery continues and, on that basis, we continue to target to break even at a profit before tax level for the full year as we move forward on our strategic objectives and continue to build on our excellent customer service,” a statement said.

Walsh said: “Despite both revenues and cost being hit by the closure of UK airspace following the Icelandic volcanic eruption and the impact of industrial action, our financial performance improved during the quarter from underlying revenue increases and further cost reductions.

“The trends in our passenger and cargo traffic continue to be positive with yields up and costs down.

“Together this led to a reduced operating loss for the period though pre tax losses increased as a result of additional finance costs and the impact of non cash foreign exchange movements.”

Walsh said there would continue to be a focus on cost control “as we grow and continue our quest for permanent structural change across the business”.

BA is re-introducing a Boeing 747 into service this winter and is keep to capacity under review “as market conditions develop”.

BA CityFlyer will launch double daily flights from LondonCity to Copenhagen in September, two flights a week between Gatwick and Cancun and double daily flights from Heathrow to Gothenburg.

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