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BA profits up to £195m
British Airways posted improved first quarter profits of £195 million, up from £124 million a year ago.
Revenue for the three months ending June 30 was up by 12.5% to £2.3 billion but costs rose by 11.8%, largely driven by a 44% increase in the cost of fuel to £512 million.
Chief executive Willie Walsh hailed new low short haul fares as a “big success”. adding: “While competition in this market is brutal I am delighted to see we are winning customers with record seat factors.
“We’re now even more competitive on price whilst keeping ahead of the game by offering full service flights, more frequently to more convenient airports.”
The airline’s much-anticipated new Club World bed would be launched soon, he added.
Walsh said: “These are good results driven by strong revenue as a result of record seat factors and better cabin mix.”
Chairman Martin Broughton said strong revenue was expected to continue, with total revenue for the year to March 2007 now expected to improve by 6-7%, up from previously expected 5-6%.
But fuel costs are now likely to be £550-£600 million up on last year.
Broughton said: “Costs excluding fuel, which were previously forecast flat, are now expected to be slightly higher this year as pension costs are driving employee costs up.”
He added: “We continue to focus on our move to Terminal 5 in 2008, investing in our products for our customers and driving a competitive cost base to make our company fit for growth.”
Report by Phil Davies
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