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".

Lets hope you shorters can do better than last time ..... lots of news in the press this morning and I am waiting to buy (interestingly no one is saying peeps are going to stop travalling on holidays or business but there you go)



ains

BA anger over aid for US airlines
Brett Arends, Daily Mail 25 March 2003

AIRLINE shares led markets down worldwide on Monday as the war took a grimmer turn. Finnair announced 1,200 lay-offs, following other major airlines last week. TUI, Europe's largest travel agency, is targeting deep cost cuts. The war could cost airlines 6bn, the International Civil Aviation Organisation said.





US government plans to rescue its own carriers, with up to 560m in direct assistance plus loan guarantees, drew an angry response from BA. 'It's an absolute nonsense in a fully liberalised marketplace,' said the airline. 'We're not going to go with a begging bowl to our Government, and we don't think any cash should be handed out to failing carriers.'


Attention is turning to Iraq's postwar reconstruction, following Development Secretary Clare Short's Commons statement and the controversy over contracts going to American firms.


Ports group P&O apparently lost the bidding to an unnamed US firm to run the key strategic port at Umm Qasr.


Britain has earmarked 120m for aid. Unlike most other countries, it does not favour domestic firms in these contracts.


Experts believe Iraq may need 60bn of investment. Neil Partrick, of the Economist Intelligence Unit think-tank, warned that Iraq's oil revenues are unlikely to rise substantially above last year's 8bn until 2005. Contractors Balfour Beatty and Amec are considered well placed to win work rebuilding roads, bridges and pipelines. Balfour has operations in the Gulf and Turkey, plus a big US business and a relationship with the American military.



2003 Associated Newspapers Ltd.

Down again, this is the one to short, those who thought this war was going to be short were loonies.Despite what our dear ains says, I still see this dropping each day, until 60p is the bottom.

What exactly did I say for the record quidnunc? - you seem to have a habit of quoting things I do not actually say


ains

I must admit I prefer Virgin Atlantic and Singapore Airlines over BA anyday of the week.

These are certainly troubed times for the airline industry and I think that these scaling back of routes and increases in fares are just the tip of the iceberg.

With all this bad news and no one wanting to fly them .... I am wondering why you guys shorted at 90p and now they are still 114p after 130p ..... something wrong here :-))



ains

Sorry ains if I upset you, but didn`t you post this yesterday?, for the record, I would NEVER mis quote you ains , there is no need.The share has dropped to 113.75p,i.e. a fall of about 10% since your post below.You were asking what had happened to shorters of this stock, ainsoph, we are still here.
****************************************

- 21 Mar'03 - 12:44 - 200 of 224


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

Sorry I cannot understand just what you are trying to say ollie ..... suggest you have a think and come back with a clear cut post of what you are doing /saying ....

ains, I am saying this,

I have never mis-quoted you, for the record, you are long BAY, I am short, there does that clear the air?
I have asked a couple of the other members of the group to help you out a little in the campaign, you are obviously overworked, 24/7 a day will bring a nervous breakdown .

I am not long - I hold just my basic quarter unit ..... you really must get it right if you intend to keep 'quoting me'


Currently moving with the market



FRANKFURT (AFX) - Deutsche Lufthansa AG said it has reduced its planned intercontinental capacity this summer by seven aircraft.

The cuts are in response to the "sharp fall in passenger bookings, especially for routes to America and Asia," the carrier said.

The focus of the cuts is on Lufthansa's flights to North America, it said.

All its current destinations will continue to be served, it said.

Further measures on short and long haul flights will be decided on at short notice in response to developments in demand, it added.

You are NOT long or SHORT but holding a quarter unit, hhhhmmmmmm!
Oh well ains you obviously know what you are talking about.
More help needed here guys I think, ains did give some signs of cracking up on the TAD thread yesterday, come on Group help him out.

BA cutting more flights as war bites
25 March 2003, This Is Money

RITISH Airways has cut back on transatlantic services and will to make an announcement about further route reductions later this week. The airline cancelled one London to New York service on Monday, Tuesday, Wednesday and Friday of this week.



BA has already suspended, or reduced, some services to the Middle East because of the Iraqi conflict.

'We are reviewing our entire world schedule in the light of what's happening in the Gulf,' said a BA spokesman. 'We expect to make an announcement about routes later this week.'

BA has already suspended flights to Kuwait and Israel and has cut its London-Dubai frequency from two flights a day to one.

Meanwhile, BA said today that eight of its Concorde services would be cancelled in the next few days because of delays in meeting American requirements
to fit high-security cockpit doors.

The affected flights are London to New York on March 31, April 4, April 7 and April 11 and New York to London on April 1, April 6, April 8 and April 13.

from tomorrows Times

The European Commission will today outline possible measures to help airlines during the hostilities, including plans to assist them if insurance companies withdraw airline cover. The Commission will also ease rules covering the use of take-off and landing slots. At present, airlines lose slot rights unless they show they are using them to 80 per cent capacity. Relaxing this rule will make it easier for airlines to cut capacity.

BA welcomed the moves, but expressed concern about the state aid being provided by Washington to US airlines. Yesterday, Bill Frist, the Senate Majority Leader, said that he expected Congress to provide subsidies, sparking a surge in the shares of American Airlines, which is teetering on the edge of bankruptcy.

The high security cockpit doors thing is a complete waste of time and money. It's a crazy fixation. If the loony is on the plane armed with anything whatsoever, you're in trouble. BA is about to ground Concorde for good anyway, sadly.

Meanwhile, one friend of mine who works for a "three-letter agency" in the US is already authorised to carry a gun (a Smith and Wesson .45) on board scheduled passenger aircraft while on duty. Anybody who knows anything about guns, ballistics and aircraft construction knows how crazy that is as well.

Anyone who flies now is subjected to a surreal experience of being treated as a wealthy lunatic -- anything I can do for you sir, a drink, massage, but don't bring anything sharp on board and you can't have metal cutlery in case you run amok.

Complete nuts.

Hmmmmmmmm ....... I know a lot about guns and don't see it as crazy and would rather a trained armed guard than an armed terrorist...... but I fly BA and they have neither :-))

It does look as though Concorde has reached the end of it's shelf life and guess we will not see it replaced - that's sad for everyone but guess it was always on the cards.

I don't find the experience of flying any different today than a while ago excepting a slightly more stringent security check - got frisked myself the other day when I had forgotten about my mobile. Made me feel safe rather than nuts :-))



ains

Currently I hold my quarter unit long term holding and will be looking to reinvest recent profits. It's clear BA management have the situation under control and will cut the cloth accordingly

ains



BA fastens seatbelts for war
By Alistair Osborne, Associate City Editor (Filed: 26/03/2003) telegraph


British Airways will announce today that it is cutting flights, postponing the launch of new services and accelerating job cuts in response to the Iraq war.

The airline, which has spent the past few days monitoring the impact of the war on passenger traffic, plans to cut the number of seats flown by up to 5pc. It has already suspended flights to Kuwait and Tel Aviv.

BA will also say that it is accelerating 13,000 job cuts, though it does not envisage making more staff redundant. As part of its plan to cut 650m of annual costs by next March, it is cutting 10,000 jobs by the end of the month and a further 3,000 over the following year. All the jobs will now go by the autumn.

The brunt of the capacity cuts will come on BA's most profitable transatlantic routes, which contributed 144m operating profits last year when the airline made a 110m operating loss.

BA is expected to cut its six daily flights between Heathrow and New York to five, excluding Concorde services. It has quietly been cancelling some services to New York since the conflict began.

The airline will also delay the introduction of extra services to four North American destinations which were planned to start as part of the summer schedule beginning next Monday.

Plans to add seven weekly flights between Heathrow and Chicago and five between Heathrow and Newark and additional services to Toronto and Houston will be postponed until the impact of the war becomes clearer.

The capacity cuts are lower than those introduced by rival carriers, partly because BA has already reduced seats flown by about a fifth over the past two years. American carriers Delta and Northwest have both cut flying schedules by 12pc in response to the war, with Northwest also cutting 4,900 jobs.

The troubled American Airlines is cutting international flights by 6pc, while United Airlines, which is teetering on the brink after filing for Chapter 11 bankruptcy protection, is reducing schedules by 8pc and putting some staff on temporary unpaid leave.

A spokesman for BA would only say: "We will put out an announcement shortly once we have assessed the early impact of the war."

Chris Avery, aviation analyst at JP Morgan, said BA was "not panicking but being prudent. If you are doing seven or eight flights a day London to New York at the moment, it's pretty excessive". BA shares rose 3.5 to 122p.

Morning ains, well as I said before, the City won`t like the war going on and 4% of the fleet being grounded, so as I am short, that means I think they will fall ains, if your long, like you , you think that your `quarter unit ` will go up,
So they are down nearly 4% today ains ,and I am well chuffed,

DAVE

You shorted at 109p and below - currently 118p ....... you chuff easily

Ah, yes ains, but the war has only started, as Winston said, "THIS IS ONLY THE END OF THE BEGINNING". I`m short in a small way ains, I couldn`t afford a `quarter unit` like you obviously,


DAVE

yes ...... I can tell you are short - the share price is moving up :-))




LONDON (AFX) - John Rishton, British Airways PLC's chief financial officer, said by speeding up the job cutting element of the flag carrier's efficiency programme, BA will manage to reduce costs by an annualized 650 mln stg before the previously set target of March 2004.
BA today announced plans to implement a reduced flying programme and an acceleration of its Future Size and Shape programme in a bid to limit the impact of the war in Iraq on its business.

The airline had already announced plans to cut 13,000 jobs by March 2004 and today said this target will be brought forward to September this year.

Rishton emphasised that bringing forward this target did not imply that the cost savings target will be achieved in September as well, "but clearly with the manpower reduction being pulled ahead we will be achieving it sooner than we expected."

Speaking to reporters in a conference call after the airline detailed plans to reduce flights and speed up its redundancy programme, Rishton said the group has not changed its overall targets.

It is "too early to give forward looking snapshots. Forecasting is very difficult at the moment: The war (in Iraq) is less than a week old," he said.

Rishton did, however, point out that BA hopes the peak summer season will mean a return to "business as usual".

All the measures announced today, he explained, merely represent a "fine-tuning" of previously announced plans.

"What we've done is taken some prudent action such as fine tuning our schedule for April and May and we'll review anything beyond that time as the situation unfolds."

Chief executive Rod Eddington warned that there are "clearly tough times ahead and experience has shown us that conserving cash is critical at these times."

"We are still assessing the impact on passenger demand but the industry has been feeling the effects of war for some weeks now. However, we are in good shape with more than 2 bln stg in cash and committed facilities available and we will survive this conflict," said Eddington in a statement.

Capacity on the North Atlantic will be cut by 6 pct and to the Middle East by 26 pct, resulting in an overall capacity cut of 4 pct.

The airline is also reviewing its capex and external spend plans, but Rishton said BA, which is due to take delivery of three A320 Aibus aircraft in the next financial year, has "the financing in place for all of those aircraft."

The European Aeronautic Defence & Space Co NV owns 80 pct of Airbus and UK defence giant BAE Systems PLC holds 20 pct in the European aircraft maker.

At 9.00 am, shares in BA were down 2-1/4 pence at 1193/4 pence, while the wider FTSE100 index was up 5.6 points at 3767.6 points.

anna.boekstegen@afxnews.com