BA profits tumble as fuel costs rise
[November 7th 2008]
British Airways profits before tax fell from £616 million to just £52 million for the six months to the end of September, but the airline says this was a good performance in awful trading conditions.
BA's fuel costs for the period were up £511 million as fuel prices rose to record levels. Overall costs were up by £711 million. "Currency effects" as the pound weakened against major currencies, contributed almost £100 million to costs says the airline.
"This is a good performance given the incredibly difficult trading conditions. The six month period will be remembered as one of the bleakest on record. The period was hit by a crisis in the banking sector, record fuel prices and several airlines going out of business," comments BA chief executive, Willie Walsh.
"We have made good progress with our plans to offset the difficult conditions. We have reviewed the summer 2009 schedule and plan to reduce capacity by some 1% compared with summer 2008. We have revised capital expenditure plans and remain focused on cost control and our strong cash position," Walsh adds.
BA says it was also hit by landing fees and en-route charges which were up 13.4%, mainly due to the effects of exchange on non-UK costs and airport charges in the UK. Airport operator BAA increased charges at Heathrow by 38% and at Gatwick by 36% for the remainder of the year says BA.
Terminal 5 is now performing "extremely well" Walsh maintains. "Transfer passenger connections are faster with 90 per cent of our Heathrow flights now under one roof. We have now moved to full operations at Terminal 5 and it is delivering real customer benefits. The terminal is proving to be the genuine asset that we always expected it to be," he says.
Walsh also emphasises that the airline's punctuality performance has improved significantly. "Heathrow punctuality levels in July, August and September were more than 20 percentage points better than the same period last year. Last month saw an improvement of 23 percentage points on October 2007. We also had our best ever day at Heathrow on October 14, with 95 per cent of flights departing on time as measured by the industry standard," he explains.
BA's latest passenger statistics, released today, reveal that traffic fell by 4.4% in October this year compared to the same month last year. Passenger load factors, the measure of how full aircraft were, also fell 3% to 77% in October.
Written by: Nick Purdom
The widest choice and best prices on Airport Parking in the UK when you book with Holiday Extras
Related News Articles
Clocks go back October | Clocks change Autumn 2011 - 26/10/2011
Pull the curtains, grab a blanket and get cosy, on Sunday October 30 2011 it's time to put your clocks back.Summer holiday bargains | Travellers wait to grab last minute deals - 15/08/2011
UK holiday-makers are holding out for last minute travel bargains this summer, and nabbing some great deals.Glasgow Airport Roadworks - 15/08/2011
Allow more time when travelling to and from Glasgow Airport. Roadworks are expected to cause delays until May 5th.
