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".

04/04/2003 10:57


ZURICH (Reuters) - British Airways Chief Executive Rod Eddington has said the airline industry is locked in its toughest crisis in living memory.

"There is no doubt about that," the chief executive of Europes largest carrier told Reuters, citing the weak economic outlook, the war in Iraq and the health scare over the deadly SARS virus.

Eddington, who is also chairman of the Association of European Airlines, said a decline in BA traffic in March was not unexpected, particularly at the top end of the market, as many businesses were advising executives to stay at home.

Eddington said BA would continue to monitor its own capacity and adjust it depending on market conditions. He was speaking on the sidelines of a business luncheon hosted by the British-Swiss Chamber of Commerce.

BA stock was up two percent at 1033 GMT, outperforming the FTSE 100 index of blue-chips which was up 0.7 percent.

BA reported on Wednesday a 11.4 percent fall in March passenger traffic from a year earlier, while premium ticket sales declined by almost a quarter, hurt by the war, cutthroat competition from low-cost rivals and the spreading SARS virus.

The war in Iraq forced BA last month to cut capacity by four percent, including the suspension of some flights to the United States, and speed up extensive job cuts.

Global airlines are making deeper cost cuts and stopping flights as the Iraq conflict casts a another shadow over a sector that was already reeling from the September 11 attacks on the United States in 2001 and sluggish economies.

German carrier Lufthansa said on Tuesday it too would stop some flights due to the Iraq war. Italian carrier Alitalia and Dutch airline KLM have also suspended routes to the Middle East.

BA -- which has the largest passenger capacity of any European airline -- said it would bring forward completion of a planned 13,000 job cuts to September this year from its previous March 2004 target.

It said the four percent capacity cut in April and May would involve reduced frequencies and the use of smaller aircraft. Capacity on high-margin transatlantic routes will be cut by six percent.

BA has cut capacity by about a fifth in the past two years. It has also cut capacity by 12 percent on its transatlantic routes, on which it relies heavily for high-margin revenues.


2003 Reuters

Up over double the general market intraday and ahead of US figures


04 Apr 2003 13:16 BST

BA chief says earnings guidance "impossible" now

ZURICH, April 4 (Reuters) - British Airways Plc BAY.L Chief Executive Rod Eddington told Reuters on Friday it was "impossible" to give any earnings guidance now in view of the uncertain environment airlies are facing.
He would not comment on how Europe's largest airline performed in its financial year ended on March 31.

Addressing a business luncheon hosted by the British-Swiss Chamber of Commerce, Eddington earlier on Friday said passenger traffic to Hong Kong had "plummeted" as a result of the potentially deadly SARS outbreak.

The company was building up "reserves to help us through very tough times", he added.

BA's focus was "not on admitting new members to Oneworld", he said when asked about Swiss flag carrier Swiss International Air Lines' SWIn.S chances of joining the alliance.

April 05, 2003

BA chief attacks aid package for US carriers
By Abigail Rayner and Russell Hotten Times



ROD EDDINGTON, chief executive of British Airways, yesterday criticised a decision to allow a $3 billion (1.9 billion) aid package for US airlines.
He said that the aid for already heavily subsidised carriers would be difficult to accept at a time when the airline industry was suffering the worst crisis I have ever seen.

The US Congress has approved the aid to help the troubled airline industry to cope with a drop in bookings and a rise in fuel costs caused by the war against Iraq. The package was agreed despite protests from the White House.

The Administration called the aid excessive and is this week due to meet representatives of Congress to agree the final amount for the airlines.

Mr Eddington said aid may be acceptable to cover higher insurance and security costs but cash grants in North America are much more difficult to accept.

April 06, 2003

Flu forces BA to cut Hong Kong services
Michael Sheridan, Hong Kong and Dominic OConnell Sunday Times for full article



BRITISH AIRWAYS is today cutting its flights from London to Hong Kong in response to the deadly pneumonia virus that is devastating business and tourism in the former British colony. It is expected to cancel one daily flight from Heathrow. The second daily service will continue.
Traffic to Hong Kong had evaporated and the decision largely reflected operational changes to ensure that crew no longer had to stay overnight in the city, a spokesman said.

Andrew Clark
Saturday April 5, 2003
The Guardian

British Airways has "capped" sales of Concorde tickets at 50 out of the aircraft's 100 seats on many transatlantic services, so that it can offer first-class

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alternatives if the supersonic plane breaks down.
In a new blow to the aircraft's prestige, BA says it has taken half the tickets off the market for certain days because of concerns about the "robustness" of the service.

A spokesman said it explained reports of unusually low loads on recent flights. In some cases, Concorde has flown across the Atlantic with just a few dozen people on board.

BA has taken the emergency step while it only has two Concordes in service - just enough to run its once daily return schedule from Heathrow to New York. Three aircraft are out of action for last-minute work to fit reinforced cockpit doors. Under US regulations, explosive-proof doors must be fitted by April 9. This has proved difficult for Concorde, which needs specially designed equipment. BA revealed last week that it had axed eight flights between March 31 and April 13 while the work is completed.

Concorde has been dogged by recent technical problems. Last month, a supersonic jet with the comedian Bob Monkhouse aboard was grounded in Barbados after two failed take-offs. On several occasions, parts of the plane's rudder have come adrift.

Passengers, who typically pay 6,800 for a return transatlantic flight, are offered first-class seats on BA's jumbo jets when Concorde flights are aborted. However, this could prove difficult as BA recently cut back its schedule for standard flights to New York.

BA is "reviewing" its Concorde services to decide whether to bring forward the supersonic fleet's scheduled retirement in 2009 due to weak demand.

BA changed Concorde's timetable this week, making flights later in the day to attract more business customers. The new schedule allows corporate bosses to do a day's work in London or New York before boarding a flight. However, industry sources say cabin crew are unhappy because Concorde arrives in New York in the early evening, then departs early the next morning - leaving them no time for shopping.

"BA changed Concorde's timetable this week, making flights later in the day to attract more business customers. The new schedule allows corporate bosses to do a day's work in London or New York before boarding a flight. However, industry sources say cabin crew are unhappy because Concorde arrives in New York in the early evening, then departs early the next morning - leaving them no time for shopping."

< <<<<<<<<<<<<>>>>>>>>>>>>>>>>>

Well it took BA some time to realise they should provide services when the punters need them! ;)

Anothe war casualty in waiting, if any bad news arrives, I see a good trade when the price drops back to 108p or so, watch out for any news on civil airliner damage in the wars progression, this is very volatile, and could drop 20% easily if this happens.I don`t short them.

up nearly 7% @ 123p and in the top ten risers on the ftse350 board .....

I recall peeps talking 60p the other day :-))

I think to be fair, they qualified the 60p by saying that it depended on the war going awry, it still may, but they were certainly 100% out on todays price.

No ..... I think they were talking sub 60p regardless of how the war played out ..... must be a few burnt fingers on this one :-))



ains

I dislike shorters, so I don`t really bother if they are burned,the hedge funds are responsible for much of the bear market we suffer today, lets hope more than their fingers ge a burning.

I never knew you could write Ains, let alone an autobiography, although you did leave 'half-assed' off...

Where have you been lately on 'your favourite airline' Ains?! :-))

BA says decision on Concorde fleet imminent
09/04/2003 12:39


LONDON (Reuters) - Europes biggest carrier British Airways says a decision on the fate of its supersonic Concorde fleet is imminent, amid reports the worlds fastest commercial planes could soon be pulled from service.

"We are looking at when the Concorde will be retiring. The process is at an advanced stage, but it is... very much watch this space," said a spokesman for BA.

Both BA and Air France, the only airlines that fly the sleek jet, have said they are considering retiring the dozen Concordes in service. BA charges about 4,500 pounds for a seat on a Concorde flight across the Atlantic.

The demise of the flashy 100-seater would spell the end of an era. The slender needle-nosed jet travels at twice the speed of sound and was hailed as the height of European technological innovation and business acumen when it entered service in 1976.

The Concorde, with its caviar and champagne-laden pre-boarding and in-flight services, was for decades a status symbol for the jet-set crew.

BA and Air France may decide they cannot afford to offer the Concordes luxury services as demand slows.

Air France declined to comment on whether it too was close to pulling the service, although it has said it is reviewing the jets future.

An Air France Concorde crashed outside of Paris in July 2000, killing 113 people. The crash forced the carriers to pull the jets for over a year and spend millions upgrading them.

The planes future became more uncertain as the war in Iraq jacked up fuel prices and as stumbling U.S. and European economies and the war cut demand for expensive business travel.

BA said on April 3 its revenue outlook was clouded because of the war, economic uncertainty, competition and a deadly flu-like virus, which has killed people in Asia and prompted travellers to cancel plane trips.


2003 Reuters

BATTERED AIRLINES




SINGAPORE AIRLINES
Cut: 60 weekly flights or 3.6 per cent of total capacity
Remarks: Destinations include Hongkong, Guangzhou, Hanoi, Taipei


CATHAY PACIFIC
Cut: 108 weekly flights, or 14 per cent of total capacity
Remarks: Includes 17 destinations in Asia, such as Manila, Taipei, Kuala Lumpur, Tokyo


MALAYSIAN AIRLINES
Cut: Two weekly flights to Hongkong in April and four flights, including two daily services, to Singapore from April 7 until end-May


GARUDA INDONESIA
Cut: Four-times-a-week service between Singapore and Medan. To suspend flights to Hongkong, Shanghai, Guangzhou
Remarks: Jakarta-Singapore route maintained


JAPAN AIRLINES
Cut: International flights by 8 per cent in April
Remarks: Include flights from Fukuoka to Hongkong, Osaka to Guangzhou, Tokyo and Osaka to Honolulu. Also, fewer flights from Tokyo to London and Guam


QANTAS
Cut: Up to 20 per cent of international flights, until mid-July


BRITISH AIRWAYS
Cut: 4 per cent of services through May, including 6 per cent cut on North Atlantic routes serving US and Canada. Flights to Kuwait suspended
Remarks: Daily flights to Hongkong down from two to one. Bangkok stop added for Hongkong flights, for staff layovers there instead of Hongkong


LUFTHANSA
Cut: Flights in Europe and to US, Japan, Middle East, Asia



KLM
Cut: 20 per cent of capacity on routes to Middle East and US and 5 per cent of European capacity
Remarks: Reviewing which Asian routes to cut


AIR FRANCE
Cut: All flights by 7 per cent because of Iraq war and Sars


AIR MAURITIUS
Cut: Twice-weekly service to Singapore and Malaysia from April 10
Remarks: Flights to Hongkong suspended, until May 31


NORTHWEST AIRLINES
Cut: 12 per cent of flights and 11 per cent of its workforce, or 4,900 jobs, because of lower demand


UNITED AIRLINES
Cut: Worldwide schedule by around 8 per cent

Remarks: Some workers put on temporary unpaid leave to cut costs


CONTINENTAL
Cut: Five weekly flights between Hongkong and New Jersey, April 12-June 2
Remarks: Sars brought 'dramatic reduction' in traffic


AMERICAN AIRLINES
Cut: International flights by 13 per cent and US capacity by 2 per cent in May

A FIRST-QUARTER profit warning from Germanys Lufthansa pulled British Airways lower in a weak session for European airlines.
The Frankfurt-listed carrier said late on Tuesday that it faced an unexpectedly deep operating loss for the first quarter because of a fall in passenger traffic and said it would introduce short-time working for cabin crew and staff. The airline blamed the war in Iraq and the spread of severe acute respiratory syndrome (Sars) for a poor performance during March.

Its European rivals retreated across the board, with British Airways, down 5p at 115p, echoing falls for Iberia and KLM. EasyJet shed 6p at 220p as Credit Suisse First Boston cut its price target from 400p to 297p and lowered its revenue forecasts after disappointing March data. The FTSE 250 closed 11.5 points behind at 4,123.5.

BA has confirmed they will retire the Concorde fleet in October - in meantime it continues to operate a reduced service - there will be a 84 million write-off for year just ended .....

sad but had to happen and a good business decision imho



ains

10 April 2003, Daily Mail

HE US has approved a route sharing deal between American Airlines and British Airways, bringing an open skies agreement with the UK closer.

115p to buy?, i`ll still wait for 108p and then pile in.


Shagger

Lets hope we get one or two good trades in and take advantage :-))

Shares have moved up on the day @ 117.5p

ains



British Airways says it is determined that Concorde goes out in style.

BA has announced special Concorde ticket deals.

The airline's chief executive Rod Eddington says the aircraft could be flown from airports other than Heathrow during its last days in service, so as many people as possible could see the plane.

"We must retire Concorde gracefully. We want the aircraft to go out on a high," said Mr Eddington.

From now, and for travel until the end of August, BA is offering a London to New York one-way ticket on Concorde and a subsonic return in economy class for 1,999.

One-way on Concorde and a subsonic return in business class (Club World) will be 2,999, while one-way on Concorde and a subsonic return in first class will be 3,499.

BA is also offering a Concorde flight and a Concorde return for 3,999.

Available until April 17, these offers are subject to travellers staying on a Saturday night, while tickets cannot be changed or refunded. One thousand seats are available.


Story filed: 09:59 Thursday 10th April 2003