British Airways posts record £531m loss

British Airways has posted a record £531 million loss, after revenue in the year to 31 March slumped £1 billion. 

 

Revenue at £8 billion was down 11.1% and yields were down 8% (including exchange). “Despite a £1 billion drop in revenue during the year, our efforts on cost control mean that costs have reduced at a comparable level and our operating loss is virtually the same as in the previous year,” explained BA Chief Executive Willie Walsh. “This is our second consecutive year of record losses but we take heart from the fact that, while our revenue has fallen by £1 billion, so have our costs,” added BA Chairman Martin Broughton. Full year fuel costs were down £597 million and there was a £390 million reduction in non-fuel costs. Walsh thanked staff and customers for their “continued support” as the airline goes through a series of struggles including Unite strikes and the economic downturn. “Returning the business to profitability requires permanent change across the company and it’s disappointing that our cabin crew union fails to recognise that,” he added. Walsh also confirmed the BA Iberia merger will be completed by the end of this year and will create the International Airlines Group. Confirmation from the US Department of Transportation and the EU to form a joint business with American Airlines and Iberia is pending approval. Passenger revenue for BA dropped by 10.9% to £7 billion and it has reported an operating loss of £231 million. "Compared to the Euro 1.5billion loss posted yesterday by Air France/KLM, BA is performing well, especially considering the impacts of snow chaos and strikes in the last two quarters of the financial year,” said Travel Expert at travelsupermarket.com Bob Atkinson. “If BA can make its mergers work there is strong potential for the alliance to deliver a more streamlined product for fares, schedules, connections and frequent flier benefits”.

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