bmi reports operating loss of £12m

bmi british midland suffered an operating loss of almost £12m last year as a result of falling demand after September 11.

The number of passengers carried declined by 5.2 percent to 6.7 million, from 7.1 million, which bmi said was “as a direct consequence of the tragic events in September”. The company estimates that £35 million revenue was lost as a result primarily through a significant drop in transfer passengers through the Heathrow hub post 11 September.

The company added that it does not expect an upturn in trading until next year. Chairman Sir Michael Bishop said: “Despite the early signs of the shoots of growth and some recovery in volume, yields continue to be under pressure and we do not anticipate that this trend will change significantly for the remainder of the year.

“The UK aviation market continues to be one of the most competitive in the world, but we remain committed to be a competitive force in a wide range of markets.”

Despite the operating loss, overall BMI pre-tax profits rose by 51.2 per cent from £8.2m to £12.4m, chiefly as a result of large exceptional gains from the sale of its ground handling operation to the Go-Ahead group.

bmi said that highlights during the year included:

the first major rebrand of the airline for nearly 20 years

investment in long haul equipment with the delivery of three Airbus A330 – 200 aircraft

investment in an innovative three class long haul product

re-entry into the transatlantic market with the launch of schedule services from Manchester to Washington DC and Chicago

application by bmi and United for anti-trust immunity from the United States Department of Transportation – this has now been approved subject to an open skies agreement between the UK and the USA

submission of a formal complaint to the European Commission contesting the legitimacy of the Bermuda II agreement

the announcement at the end of the year that bmi would enter the low cost market at East Midlands Airport with the launch of bmibaby.