I am sure most peeps will know this is my favourite airline - I fly them and I buy them.

Currently I hold a quarter unit as a longer term investment which is also useful for shareholder benefits.

I will be looking to substantially add at the right time and not afraid to trade them either intraday or more probably as a swing trade.


ains




Shadow of conflict looms large over British Airways as firm fights to recover

TRACEY BOLES - Scotland on Sunday

BRITISH Airways will warn that the prospect of war with Iraq casts a long shadow over its full-year this week when it posts third quarter figures in line with expectations.

Lord Marshall, the BA chairman, is expected to tell analysts that political uncertainty could push the airline, still struggling to recover from the effects of September 11, further into reverse.

"Iraq is a key driver for everything," said a source close to the airline.

BA has admitted privately to analysts that transatlantic bookings for this March are "appalling" as the uncertainty stirred up by the prospect of war exerts an influence. Earnings estimate downgrades are now highly likely.

However, analysts believe a loss for the full year is still not on the cards.

Pre-tax estimates for the full year currently stand at up to 140m. BAs performance, which represents a strong recovery from the 180m loss posted in the equivalent quarter after September 11, has been driven by a vigorous cost-cutting programme rather than by revenue, which is still flat.

It will announce tomorrow that it is on track to achieve cost savings of 450m by the end of March through a process of shedding jobs and loss-making routes under its future size and shape strategy.

By the end of next month 10,000 jobs will have gone under the programme. "BA has weathered the storm better than most by getting costs under control," said one analyst. "In Europe, only Iberia has done likewise."

Third quarter operating profits are expected to be around 30m to 40m, in line with analysts expectations, with pre-tax figures between a 10m loss and 5m profit. The consensus is break even.

The airline has impressed experts by taking the threat posed by low-cost carriers seriously.

Geopolitical and economic problems are affecting demand air travel, especially on long-haul routes. BAs premium services are still under pressure, recent traffic figures revealed.

A speedy Gulf war will lead to a relief rally for the airline sectors shares which are depressed at the moment. However, BA itself has warned that prolonged conflict could trigger a slump in aviation equivalent to that seen after September 11.

Chris Tarry, former aviation analyst at Commerzbank who now runs CTAIRA said: "I believe that the last quarter has been very tough on the revenue side and indeed they have indicated this themselves.

"Unfortunately the outlook is no better - even without a war. The reality of the economic situation in the UK was underlined with the rate cut.

"Add to that the structural downward shift in fare levels and then the uncertainty over war - it doesnt bode well.

"Furthermore, given the uncertainty caused by Iraq let alone an actual war, it is pretty clear that the transatlantic market will be dire in the summer."

BA has traditionally depended on transatlantic traffic for its revenue.

Shells chairman, Sir Philip Watts, also admitted last week that the oil giant was preparing for "uncertain times" ahead.

He said Shell had looked at the range of possibilities that could occur and had "a plan for every eventuality".

Thursday March 20, 02:58 PM





LONDON (Reuters) - Now war in Iraq threatens the beleaguered airline industry with another tailspin, carriers across the globe are preparing job cuts and selective fare increases to see them through the latest turbulence.


Airlines have lost $30 billion in the last two years and have warned that earnings in 2003 would be hit again as demand for tickets is expected to fall as much as 20 percent.


"Our assessment after September 11 has been proven right: the crisis will not be overcome within one year," Deutsche Lufthansa (Xetra: 823212.DE - news) Chief Executive Juergen Weber told a news conference.


Germany's largest airline said it would look to flexible work hours to trim costs, while other airlines said jobs would go.


Swiss International Air Lines (Zurich: SWIn.S - news) laid off 169 pilots, the first of 700 previously announced job cuts.


Finnair said it, too, would open lay-off talks as the Iraq crisis worsened already grim market conditions.


The moves followed an announcement on Wednesday by U.S. carrier Continental Airlines Inc (NYSE: CAL - news) that it would cut 1,200 job, with the possibility of more if war is prolonged.


"We need $500 million in annual cost savings and revenue generation to permit us to be a survivor during the worst financial crisis in aviation history," Continental Chief Executive Gordon Bethune said in a statement.


PRICE HIKE


The industry is in worse shape than at the time of the last Gulf war in 1991, with margins squeezed further as low-fare carriers grab market share.


To help airlines cope, Geneva-based trade association IATA said more than 100 airlines had agreed to boost some international ticket prices by 2-3 percent.


The increase, the first in two years, will affect only top-class, flexible business fares beginning on April 15, representing around five percent of the world market and will not apply in Europe.


"Increased insurance premiums, security costs, and fuel made it imperative to adjust fares," IATA spokesman William Gaillard said.


As war added urgency to cost-cutting plans, airlines around the world announced flight cancellations, some directly related to the Gulf region, others far afield.


Shares in Europe were mostly firmer by afternoon on hopes the war would be brief and jet fuel costs would ease, though British Defence Secretary Geoff Hoon advised against such optimism.


"I would caution the House against suggestions that this campaign will be over in a very short time," Hoon told parliament in an emergency statement.


Britain also warned its citizens of heightened travel risks, including vacation destinations.


British Airways Plc (LSE: BAY.L - news - msgs) , Europe's largest carrier, was up 0.21 percent at 119 pence as of 1332 GMT.


It said on Thursday it was still on track to post a profit this financial year, despite war.


Lufthansa was up 2.89 percent at 8.90 euros, despite reporting a 2002 operating profit a day earlier that fell short of analysts' forecasts.


AMR Corp (NYSE: AMR - news) , parent of American Airlines Inc, the world's largest carrier, closed up 7.6 percent at $1.84 on the New York Stock Exchange on Wednesday.


Jet fuel prices on Europe's benchmark cargo market were lower in afternoon trade, down $10 a tonne at $305.


Crude oil prices have surged 50 percent in the last four months on concerns over Iraq, though in recent sessions prices have eased.


London's Brent crude was down $0.15 at $26.60.


European and Asian carriers are seen better prepared for the war than their hard-hit peers in the United States, where UAL Corp (NYSE: UAL - news) 's United Airlines and US Airways Group Inc are already in bankruptcy.


Still, the industry's troubles have reached around the world, with Australia's Qantas Airways announcing it would cut three percent of its workforce and Singapore Airlines Ltd set to cut eight percent of its flights.


British Airways, Lufthansa and Japan Airlines System Corp, along with several U.S. peers, have been placed on the CreditWatch list of credit ratings agency Standard & Poor's.

All helps .....


Worlds largest airlines cut flights and jobs
21/03/2003 07:43


By Kathy Fieweger

CHICAGO (Reuters) - Several of the worlds biggest airlines have announced cuts in jobs and flight schedules, beginning what is expected to be a wave of reductions because of a slump in travel made worse by the Iraq war.

Bankrupt United Airlines , the worlds No. 2 air carrier, told employees to expect unpaid leaves and capacity cuts. Air Canada said the war underscored a need to cut 3,600 of 40,000 workers this year.

AMR Corp.s American Airlines, the worlds largest airline, said it would cut international flights by 6 percent in April as an initial step because of the war, trimming some flights to Europe and Latin America.

"Even as we keep working, day in and day out, to keep this company afloat, we will have to trim some capacity as prices and supplies are impacted by the war," AMR Chief Executive Donald Carty told the airlines employees.

AMR is struggling to stay out of bankruptcy protection, a fate that has already claimed two major U.S. airlines -- UAL Corps United Airlines and US Airways Group Inc. .

The U.S.-led war in Iraq could not have come at a worse time for global airlines, which have lost billions of dollars since the Sept. 11, 2001, hijack attacks on the United States.

The war has hit airline bookings, especially international travel, and has left some airports quiet as travelers opt to stay home.

"International has been soft for weeks," said Carol Jouzaitis, a spokeswoman for the online travel site Orbitz. "Since Monday its dropped sharply. The international schedules are all being adjusted."

During the 1991 Gulf War, transatlantic bookings also suffered the most. But the industry is in worse shape now than it was then, with margins squeezed further as low-fare carriers grab market share.

Anticipating customer wariness, airlines recently announced relaxed cancellation policies, giving passengers one free change of plans without being penalized.

Analysts called the move a smart one, given the uncertainty afflicting an industry reeling as never before.

"We would expect demand trends to continue to worsen for the U.S. carriers," said Jamie Baker, an analyst with J.P. Morgan.

Shares of AMR Corp. and UAL Corp. closed weaker on Thursday, and the American Stock Exchanges airline index < .XAL> fell by 0.3 percent.

SIGNALING TROUBLE

USAir, looking to emerge from bankruptcy at the end of March, said on Thursday that crucial talks on a new pension plan for pilots had reached an impasse.

Two days after clearing a milestone in its reorganization plan, John Butler, the companys bankruptcy attorney, delivered a downcast report on operations at the No. 7 airline, now under added pressure from the war.

"On the second day of this war it is not a bright picture for the airline industry, and there are issues we have to confront," the lawyer said. A US Air spokesman said bookings were down 20 percent last week and off 40 percent on Wednesday.

But U.S. airlines with the heaviest exposure to the transatlantic market, such as US Air and No. 3 carrier Delta Air Lines , have not yet announced changes to their flight schedules.

Changes were expected within days because many U.S. corporations are telling employees to stick only to essential travel and to avoid certain Middle East countries altogether.

Industry experts noted that after the Sept. 11 attacks, it took airlines as much as a week to figure out how much demand was slipping and how to deal with it.

CONSERVING CASH, AGAIN

With the war under way, it was far from business as usual, industry sources said, as airlines reviewed various contingency plans in an extremely depressed financial environment in which sources of capital have dried up.

U.S. airlines still hold out hope for government aid. A key Republican lawmaker, Congressman John Mica of Florida, said on Thursday he was reviewing possible aid to U.S. airlines and waiting for a White House signal on whether and when Congress should mitigate the carriers expected losses from the war.

"Ill bet you every airline CEO is calculating daily receipts and advance bookings and seeing how things stand over the next day, over the next week, over the next month," said an airline industry banker. "For the U.S. airlines, to have as much liquidity and cash as possible is the key. Thats how an airline stays afloat."

The top U.S. carriers have lost nearly $20 billion in the last two years and have warned that 2003 earnings would be hit again as demand for tickets is expected to fall as much as 20 percent.

Just hours before the attack on Iraq began late on Wednesday, Continental Airlines, the No. 5 U.S. carrier, announced $500 million in cost cuts and 1,200 layoffs as the unprecedented aviation crisis showed no signs of abating.

ACROSS THE POND

In Europe, the story was much the same.

Deutsche Lufthansa , Germanys largest airline, said it would look to flexible work hours to trim costs. Swiss International Air Lines laid off 169 pilots, the first of 700 previously announced job cuts.

Finnair said it too would open layoff talks as the Iraq crisis worsened already grim market conditions.

To help airlines cope, the Geneva-based International Air Transport Association said more than 100 airlines had agreed to boost some international ticket prices by 2 percent to 3 percent.

Australias Qantas Airways announced a 3 percent staff cut and Singapore Airlines Ltd. said it would cut 8 percent of its flights.


2003 Reuters

Intraday - 120p and outperforming the market - at a two month high ..... which is nice



ains

Starting to wonder what happened to all the shorters on this stock :-)) - now up a third since they last came on here to crow about their shorts .... up nearly 5% intraday @ 122p and in the top ten risers



ains

Still moving up and number two in the ftse100 risers list @ 125p


FRANKFURT (AFX) - Deutsche Lufthansa AG said it is increasing cargo transportation charges by 0.10 eur per kilo from March 25 due to extra costs caused by the war in Iraq, such as higher fuel usage.
The surcharge will remain in place until normal flights resume once the conflict is over, it said.

scs/jsa

By Yvette Essen Telegraph
(Filed: 22/03/2003)


BA soars as nerves settle

Hopes that war with Iraq will be over shortly gave British Airways a further lift, making it one of the leading blue-chip risers yesterday.

It rose 8.5 to 125p after the airline said its crisis team had decided not to suspend any more services. It has already unveiled plans to suspend flights to Kuwait and Israel. The shares have now risen by 39p, or 45pc, over the past seven days of trading.

BA's share price had almost halved since January on investors' concerns about when the conflict would begin.

Analysts said that investors now expect the battle to be swiftly over, which will result in passengers feeling more secure about travelling again. Moody's Investors Services is more cautious, and has placed BA's debt rating on review for possible downgrade.

LOL - you'll be pleased to know that i am offside with BAY now Ains, im not offside enough to be in your special league but wrt to my last trade in BAY, at this point in time, i technically would of made more money going long than short. Im still happy to sit on it, and i have a fair way b4 being stopped out. no amount of cutting and pasting will help BAY, their goose is cooked.

However...

ainsoph - 19 Mar'03 - 09:07 - 177 of 202


interestingly, I do always seem to do a lot better than the shorters ....

interestingly, I remember you buying @ 180p!!
LOL!!!!!!

tpaulbeaumont - you are one weird peeps ...... I don't recall buying BAY @ 180p ........ but as they were last at 180p some 8 months ago or so - it's not surprising. I have probably bought and sold 180 times since then.

Suggest you stay up to date and look to the future. You short peeps seem to trade in a strange way - you recall a possible purchase (you claim) I made many many months ago but you don't recall me buying at sub 90p just a few days ago .... weird - really really weird


ainsoph


BTW - when did I buy @ 180p and more importantly - when did I sell them :-))

ok, well i guess that your initial stake was larger than the size of you recent stakes, afterall there are some serious loses to contend with. So lets say you averaged down at 90p, your still long c135, BEST CASE scenario. WORST CASE(highly likely given your past performance) your long from c250, and scalped a couple hundred shares @ 90p in a futile attempt to make back some losses! Obviously you'll manipulate and deny everything I've said but its probably close, and its probably indicative of your entire trading history!!! is'nt it Ains ;D

good morning...oil price smashed to pieces last week might be a rebound taking out ba gains
will ba be able to continue its massive rise this coming week with all this stil going on?
http://www.polskishop.com/24_03_03.htm

tpaulbeaumont ...... you are talking and thinking crap (do me the curtesy of reading my posts before guessing what I say)

ains



War-hit BA considers going Dutch
By Jason Nissand Clayton Hirst INDY for rest of story
23 March 2003


Rod Eddington, chief executive of British Airways, will this week travel to Amsterdam for talks with his opposite number at KLM, Leo van Wijk, about rekindling merger plans between the two European airlines.

The move comes as BA prepares to axe 3,000 staff a direct result of the war in Iraq. Insiders say that Mr Eddington is due to announce the redundancies in a package of measures to protect the airline from a sudden fall in demand for long-haul flights. The job cuts could come as soon as this week. BA is also understood to be planning to offer some workers temporary unpaid leave and preparing to ground flights.

This looks promising



March 23, 2003

New suitor for Deutsche BA
Dominic OConnell S TIMES



BRITISH AIRWAYS is in talks with Tui, the German holiday company, over a possible sale of Deutsche BA, the British airlines German arm.
Last week Easyjet, the UK low-cost carrier, dropped plans to buy Deutsche BA, citing the tough German market and difficulty with local labour laws.

BA is understood to have resumed talks with Tui, which had expressed an interest in Deutsche BA before Easyjet secured an option to buy the airline. Tui is one of Germanys largest holiday companies, and also owns Thomson Holidays, Britains second-largest tour operator, and Lunn Poly, the high-street travel agent.

It is thought that Tui could merge Deutsche BA with Hapag-Lloyd Express, a no-frills scheduled airline it launched last year. Hapag-Lloyd Express is based in Cologne, and a deal with BA would allow it to expand into Munich. Charles Gurassa, Tuis northern Europe chairman, is a former senior executive at BA.

BA said after Easyjets withdrawal that it had no plans to close Deutsche BA, which has not made a profit since it was founded in 1992. The carrier is expected to press ahead with a restructuring that will include a switch to budget-airline style operations and a rejig of routes, while talks with prospective buyers continue.

massive amounts of comment in the sundays




As war buffets the world's airlines, which ones will still be in it for the long haul?
Conflict could spell the end for at least one big-name carrier
By Clayton Hirst
23 March 2003




'We'll keep BA flying through the crisis' says Eddington
(Filed: 23/03/2003)


In an exclusive interview, the airline's head tells Edward Simpkins how he is countering the effects of the war in Iraq






Interview: Andrew Davidson: More turbulence in the cockpit at BA
The airlines chief, Rod Eddington, has weathered crisis before but now he faces war chaos halfway through a restructuring



MAY you manage in interesting times. Rod Eddington, chief executive of British Airways and a man entitled to feel that he is on a very long, turbulent flight, rolls his grey-blue eyes in agreement.

BA denies merger with KLM amid talks to sell Deutsche

ROB GRIFFIN scotsman


BRITISH Airways yesterday confirmed it was in talks over a possible sale of its German arm, but denied it has rekindled merger plans with rival KLM.

The airline is believed to be discussing the future of Deutsche BA with Germany holiday company Tui, after EasyJet dropped plans for a takeover last week.

A BA spokeswoman confirmed there was interest from other possible suitors but refused to name the companies involved. "We certainly have got other interested parties but any talks would be at an early stage," she said. "We are not prepared to speculate or name names."

But she dismissed as "rumour and speculation" reports that chief executive Rod Eddington was this week meeting his opposite number at KLM, Leo Van Wijk, in a bid to resurrect merger plans last discussed almost three years ago.

In a separate development, Virgin confirmed it is planning to launch a new low-cost airline in the United States - despite the financial crisis gripping the industry.

Sir Richard Branson is holding talks with a potential backers for the $15 million (9.6 million) project, which could launch by the end of next year.

Last night, a Virgin spokesman said: "We are investigating the possibilities as its always been our aim to have a low-cost airline in the United States.

"Many analysts believe at least one airline could go under this year which would create a unique opportunity for us. We have got the experience to go in and operate more efficiently than the others."

The news comes at a difficult time for airlines. Passenger numbers have been so badly hit since the terrorist attacks of 11 September that many major carriers have flown into severe financial crises.

Senior airline executives also fear a further downturn in response to the war in the Gulf, and may start cutting back on routes and staff numbers over the coming weeks.

BA, which is also considering putting staff on unpaid leave, is believed to have re-entered discussions with Tui after EasyJet backed away from a deal, citing the tough German market and local labour laws.

Last week, the airline insisted it had no plans to close Deutsche BA, despite the fact it hasnt made a profit since it was founded in 1992, although finding a buyer would be a welcome relief.

Some analysts also believe a tie-up between BA and KLM could be beneficial to both companies. Talks broke down in 2000 over a number of points, including a recent fall in the value of KLM shares, but both appear keen on consolidation.

KLM is believed to have held talks with Air France last year, while BA has bought a stake in the Spanish carrier Iberia.

But last night, a KLM spokesman moved to quash the speculation. Although he was unable to confirm a meeting between Mr Eddington and Mr van Wijk, he insisted: "I can assure you there are no merger plans at this stage."

03/24 00:12
BASF, British Air May Rise as Oil Dips: European Stocks Outlook
By Balduin Hesse


London, March 24 (Bloomberg) -- European stocks, as measured by the Dow Jones Stoxx 50 Index, have risen 21 percent during the past seven sessions. The price of Brent crude oil has tumbled 28 percent in the same period.

That's no coincidence, some investors said. Lower oil prices ease the burden of energy costs for the region's chemical makers, including BASF AG and Rhodia SA, and airlines, including British Airways Plc. They also may boost corporate earnings by removing a possible drag on consumer spending.

The combination might spur further gains by European stocks in coming days, they said. Crude oil fell for a seventh session on Friday as U.S.-led troops sent to battle in Iraq secured the country's two largest oil fields.

``I am buying shares every time the oil price falls,'' said Guy Monson, who manages the equivalent of $2.7 billion at Sarasin Investments. Oil's decline is ``a major stimulus on the economy and profits, and it will be a driver of business confidence.''

The Stoxx 50 surged 8.5 percent last week, while the Stoxx 600 Index climbed 7.8 percent. Both benchmark had their biggest weekly gains since September 2001, and extended rallies that started March 12 after they fell to six-year lows.

Germany's DAX Index soared 13 percent, the week's biggest gain among 76 global benchmark indexes tracked by Bloomberg. The U.K.'s FTSE 100 Index added 7.2 percent and France's CAC 40 Index climbed 5.5 percent.

20 Percent Gains

Brent crude, a benchmark for two-thirds of the world's oil, peaked near a 2 1/2-year high on March 12 amid concern that the war would disrupt supplies. Since then, Brent has tumbled more than 25 percent.

The Stoxx 600's chemical index surged 14 percent, the week's biggest gain among its 18 industry groups. BASF, Europe's largest chemical company, and Rhodia, France's largest maker of specialty chemicals, both climbed by about 20 percent. Only Bayer AG rose more; its shares jumped 36 percent as a Texas jury cleared the company in a lawsuit over the Baycol anti-cholesterol drug.

Chemical companies use oil as a raw material in the manufacturing of products such as plastics. BASF has closed plants and overhauled production to save money as oil prices climbed more than 50 percent during the past 12 months.

British Airways, Europe's largest airline, rose 18 percent last week. The gain contributed to a 12 percent increase in the Bloomberg Europe Airlines Index, consisting of eight carriers, which reached a two-month high.

Business Confidence

Deutsche Lufthansa AG, Europe's third-largest airline, climbed 13 percent even as it said this year's profit will fall because the war has reduced demand for air travel. Alitalia SpA, which reports earnings on Friday, rose 2 percent.

Fuel accounts for 12 percent to 15 percent of an airline's costs, according to an estimate by Aviation Economics, a London- based consulting firm.

Investors' focus on the war with Iraq may diminish the effect of business confidence surveys from Germany, Italy and France scheduled for next week.

Among executives in Germany, Europe's largest economy, confidence was little changed this month as they waited for a resolution of the conflict, according to economists surveyed by Bloomberg News. The Ifo economic research institute will release its survey on Wednesday.

Italy is scheduled to release business confidence figures on Tuesday. France will publish its indicator of business sentiment on Thursday. Confidence index for both countries will decline, according to the average estimates in Bloomberg News surveys.

`Good for Equities'

Otmar Issing, the chief economist at the European Central Bank, may provide some guidance of the region's economic outlook when he addresses the European Parliament on Monday. Last week, the central bank said it couldn't assess the effects of the conflict in Iraq on the economy.

``The prospects of an economic recovery are improving'' as crude oil prices decline, said Ruben Mikkers, who helps oversee the equivalent of $9.5 billion in European equities at Robeco Groep NV in Rotterdam, the Netherlands. ``It's good for equities in general.''

Munich Re, the world's largest reinsurance company, is among European companies reporting fourth-quarter earnings. The company will probably say Thursday that its loss widened to 1.7 billion euros ($1.8 billion) as it wrote down equity investments, based on the average estimate in a Bloomberg survey of nine analysts.

Shares of Munich Re, catering to insurance companies rather than consumers or businesses, have surged 27 percent since March 12 as stock-market rallies made those investments more valuable. Before then, the stock price fell to its lowest since April 1995.

Swiss Reinsurance Co., a rival, will give investors more details about its full-year results on Thursday. The company on Feb. 26 posted a loss of 100 million Swiss francs ($74 million).

Other companies reporting earnings during the week include Swisscom AG, Switzerland's biggest telephone company; Woolworths Group Plc, a U.K.-based discount retailer, and Metro AG, Europe's third-largest store operator.

Shares in Fiat SpA, Italy's biggest manufacturer, may rise as a result of the company's announcement on Saturday that it had agreed to sell its insurance unit, Toro Assicurazioni SpA, to the investment company Finanziera De Agostini for 2.4 billion euros, investors said. The sale will help pay for management plans to revive Fiat's unprofitable auto business.

Shares in Oxford GlycoSciences Plc, a U.K. biotechnology company that is selling itself, may rise on weekend news that Celltech Group Plc, the U.K.'s biggest biotechnology company, bought 10 percent of Oxford shares on Friday.

nice posts ainsey!

down 4% today ains, how much did you say you last bought at again?

50p target now seems reasonable.

hmmmmmmmmmmmm ........ looking to buy but doubt we will see 50p but who knows - I suggest you keep shorting until they do get to 50p :-))


ains

Flew back on Virgin from San Francisco on Sunday. Super service, their Clubhouse "Upper Class" lounge at San Francisco is absolutely the best I've ever been in. Fabulous service, amazing food in the lounge. Frequent flyer programme knocks the socks off BA's.

Virgin are going to launch a low cost airline in the US -- they've seen the gap opened up by the high-cost competitors who are bust (United/American).

I think the boy Branson may have got it right.

MM