London, Tuesday, November 5, 2002: British Airways today announced a pre-tax profit of £245 million (2001: £5m) for the three months ended September 30, 2002.
The three-month pre-tax figures took the result for the half-year to £310 million (2001: £45 million). Yields in the second quarter were up 1.2 per cent (2001: 6.1 per cent).
Operating profit for the quarter was £248 million (2001: £72 million). The figure for the six months was £406 million (2001: £122 million).
Group turnover for the second quarter was £2,104 million (2001: £2,251 million), down 6.5 per cent on a flying programme reduced by 10.1 per cent, measured in available seat kilometres (ASKs). Traffic volumes, measured in revenue passenger kilometres (RPKs), were down 6.8 per cent. Seat factor was up 2.8 points to 76.7 per cent.
Operating cashflow for the six months was £756 million. After disposal proceeds, capital expenditure and interest, cash inflow was £738 million, a £684 million improvement. Debt is down by £1 billion since December, its lowest level since September 1999, to £5,524 million from £6,528 million.
The improved operating results are driven by significant cost reductions in all areas including manpower, fuel, selling and distribution, engineering and operational costs, in line with the Future Size and Shape strategy announced in February and the swift actions taken post September 11, 2001.
There will be no interim dividend.
Rod Eddington, the airline’s Chief Executive, said: “Our Future Size and Shape business strategy focuses on reducing costs, removing complexity and restructuring our shorthaul business. These results show we are delivering despite the difficult trading environment and continued uncertainty in the market. These figures are testament to the continued commitment and dedication of our people.”
Lord Marshall, British Airways’ Chairman, said: “While the travel market continues to be subject to global, economic and political uncertainty, the revenue outlook has stabilised. The implementation of the Future Size and Shape programme continues on track and is delivering the cost savings that, in the absence of war or terrorist action, are expected to return our business to profitability for the full year.”
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