BA expected to return to profit

British Airways is expected to make a return to half-year profits when it reports its interim results on Friday.

In a sharp reversal of last year’s record £292 million half-year loss, the market expects BA to report pre-tax profits of £73 million in the first six months.

The improved figures come as the air travel industry sees a marked global recovery, with both US rivals Delta and American airlines announcing better-than-expected results in recent days.

Last year’s plunge marked the first time BA has recorded a first half loss – normally a buoyant period for the airline as it includes the holiday season.

The first six month’s bad trading were reflected in the rest of the year, prompting the airline to file a pre-tax losses of £531 million for the 12 months to March.

The airline blamed a £1 billion fall in revenue to £7,994 million, but said losses were partially offset by cost cuts including a £597 million cut in fuel costs and a £390 million reduction in other operating costs.

The results also reflected the impact of on-going strike action. BA cabin crew are currently voting on whether or not to hold further strikes over the Christmas period.

However, it is hoped a new deal presented to crew earlier this month may yet lead to a peaceful resolution of the dispute.

The loss was the largest since BA was privatised, and comes on the back of a £401 million pre-tax loss last year.

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