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".

FORTUNE TELLER

GUY DIXON SoS


SEVERAL of the biggest names on the London market will test investor confidence this week, with results due from the likes of BT, BP, GlaxoSmithKline and the first of the big players from the banking sector.

Investors will be keen to see if British Airways can get the corporate week off to a flying start on Monday when the airline reports third-quarter figures.

Gerrard is predicting pre-tax profits for the nine-month period of 182m against the 250m loss announced last time. This estimate excludes any profits or losses from disposals.

When it released third-quarter traffic figures earlier this week, BA reiterated its warning that annual revenues this year would be lower than last and the threat of war in Iraq is unlikely to do much to aid the companys outlook.

ainsoph - how often have you flown with BA in the last year?

not as many times as I would have liked :-))


The Business: British Airways is to announce third-quarter operating profits of up to 40m, in line with analysts expectations.


ains

I would say that BAY are in the worst position of all the Airlines when the war starts and/or if we have any more terrorist attacks. 'Fly the flag'? You couldn't pay me enough to!
I would jump on one of those silly orange planes though, not only are they cheaper, but somehow I can't see binliner wanting to ruin one old Stelio's planes. ;oO

I think the BA security is a lot tighter and the service more professional but guess I wouldn't be flying to the ME any time soon - if war breaks out. Ultimately the war will end and peeps will soon forget and start flying again .... I will buy in the dip but happy to hold a few in the meantime


ains

why so coy, ainsoph? how many times have you flown with BA in the last year?

In my case I shall be avoiding BA in future, after their bizarre treatment of me. They have lost all my travel and their position as preferred airline for my company. Admittedly, we weren't their biggest customer -- but we're now one corporate customer less. Largely run by clueless marketing people, much to the frustration of the aircrew and ops folks.

MM

I thought their marketing was significanyly improving ......


ains


Easyjet talks on DBA may collapse
By Jens Flottau in Munich
Published: February 9 2003 21:51 | Last Updated: February 9 2003 21:51


The takeover of Deutsche BA, the lossmaking German subsidiary of British Airways, by Easyjet, Europe's largest low-cost airline, is understood to be on the brink of collapse after failure to resume crucial talks with pilots.


Easyjet and the pilots of DBA have not yet been able to agree on the new wage contracts, which are based on conditions of employment for low-cost carriers.

At the same time, Easyjet is not prepared to enter into further negotiations and is understood to have stopped the meetings of both parties.

well i've had a couple of really poor experiences with BA in the last few months, which is why i asked how many times you've travelled with them recently, ainsoph. so how often have you flown with them in the last year? come on tell us - don't be shy.

their saving grace is that most of the others are awful too.....

Q3 results are out ........



02/10 07:32
British Airways Posts 3rd-Quarter Profit on Cost Cuts (Update1)
By James Regan


London, Feb. 10 (Bloomberg) -- British Airways Plc, Europe's largest airline, posted a third-quarter profit, reversing a year- earlier loss, after the company cut one-sixth of its workforce, scrapped unprofitable routes and streamlined its fleet.

Net income in the three months ended Dec. 31 was 13 million pounds ($21 million), or 1.2 pence a share, compared with a net loss of 144 million pounds, or 13.4p, in the year-ago period. Analysts surveyed by Bloomberg expected a loss of 53 million pounds. Sales rose 1 percent to 1.86 billion pounds.

``Our total costs in the last 12 months are 1 billion pounds lower than the previous year which demonstrates the determination of our people to deliver,'' said Chief Executive Rod Eddington in a Regulatory News Service statement.

British Airways has cut 9,209 of its 56,500 employees and expects to reduce its workforce 23 percent by March 2004 as it tries to counter a slump in air travel after the Sept. 11 attacks and a drop in business traffic amid a global economic slowdown. It's also reorganized its European short-haul flights to compete with low-cost rivals such as EasyJet Plc.

The carrier said it remains on target to reduce its workforce by 10,000 employees to 46,500 by the end of March. The company also said it expects to post a full-year profit, though it sees no growth in revenue in the next 12 months.

``In the absence of hostilities in the Middle East, we expect this financial year to be profitable,'' Chairman Lord Marshall said in the statement. ``We expect the business environment to be tougher in 2003 than last year.''

I think the figures and the statement are much in line with market expectations and I remain a hoolder of a quarter unit and continue tracking for now ..... shares down around 1% which is slihjtly underperforming market


ains



Monday, 10 February, 2003, 07:16 GMT
BA profit recovery continues BBC


BA warned 2003 will be a tough year

The turnaround in British Airways' fortunes has continued, with the airline reporting another profit.
BA posted a 25m profit for the last three months of 2002, compared with a loss of 160m a year previously.

The airline said it expected to report a profit for the full financial year if there were no hostilities in the Middle East.

But it warned the business environment would be tougher in 2003 than last year, and added it anticipated no revenue growth over the coming year.

Cost-cutting

Last May, BA reported a 200m loss - its worst result since privatisation - as it struggled against competition from budget airlines and the post-11 September downturn in passenger numbers.

The loss prompted a major restructuring programme which saw the airline cut thousands of jobs, reduce capacity and slash fares.

BA's chief executive, Rod Eddington, said the changes had left the airline "leaner, fitter and more competitive".

"Our total costs in the last 12 months are 1bn lower than the previous year."

War threat

The latest results mean BA has recorded a profit of 335m for the nine months to the end of December, compared with a loss of 115m at the same period last year.

But the prospect of a war with Iraq still poses a threat to the carrier's prospects.

BA's shares have fallen in recent weeks over fears that a conflict would put people off international travel and hit the airline's profits.

A war could also lift the price of aviation fuel, adding to the pressure on BA.

10 Feb 2003 08:25 GMT



BA profit soars but it sees tough 2003

LONDON (Reuters) - Deep cost cutting has helped British Airways post a third-quarter profit above market expectations and Europe's biggest airline expects a full-year profit, if there is no war in Iraq.
But BA, which has slashed thousands of jobs, cut capacity and dropped ticket prices in response to weak demand and competition from Europe's no-frills airlines, said it expected the business environment in 2003 to be tougher than 2002.

"In the absence of hostilities in the Middle East, we expect this financial year to be profitable," Chairman Colin Marshall said in a statement, adding that "at this stage we anticipate no revenue growth over the next 12 months".

BA BAY.L had a pre-tax profit of 25 million pounds for the three months to December, compared with a loss of 160 million pounds in same period in 2001 -- after the September 11 attacks in the United States sent the industry into a financial dive.

Turnover rose one percent to 1.857 billion pounds.

Shares in BA closed at 116 pence on Friday. The stock has underperformed the benchmark FTSE 100 Index by seven percent since it won back its place among Britain's blue-chip companies.

The September 11 attacks accelerated an industry downturn that began as economic growth slowed. The slump has hit BA particularly hard on its important North American routes as companies keep a lid on travel expenses.

Debt-laden BA responded to the stormy market conditions with a two-year "future size and shape" programme designed to extract 450 million pounds in annual savings by the end of March, rising to 650 million pounds by the end of March 2004.

BA said its two-year programme was on track and delivering more than the expected cost savings. Debt was 5.2 billion pounds at December 31, down 1.4 billion pounds from its 2001 peak.

Quite a wide trading range today ....... US futures are mixed with Dow up 15 and S+P up but NAS marginlly down on fair value.

Worth remembering there is a lot of US interest in BA


ains




British Airways back in profit but 2003 to be tough

Mon 10 Feb 2003



LONDON (SHARECAST) - British Airways struggled back into profit in the third-quarter after mass job cuts, streamlining its fleet and cancelling unprofitable routes but added that this year will be tougher than last and that it does not expect any growth in revenues.

"We are leaner, fitter and more competitive, said chief executive Rod Eddington. Our total costs are 1bn lower," he said, referring to the restructuring plan of the airline that was launched 12 months ago.

In the same quarter in 2002, BA reported a 160m loss, as air traffic stalled following September 11 attacks. The job cuts, which amount to 23% of the workforce by 2004, is a bid to counter a drop the drop in air travel, and a slump in business traffic with the global economic slowdown.

It also faces strong competition from low-cost airlines such as Easyjet and Ryanair.

The company said it expects to post a full-year profit to March, reversing a 142m loss in fiscal 2002, though it sees no growth in revenue in the next 12 months.

Net income in the three months ended 31 December was 13m compared with a net loss of 144m, in the previous year, it said.

The airline is preparing itself for a drop in traffic if war breaks out with Iraq. As a result, "Corporate travel budgets are going to remain under pressure for a long time yet'' it added.

LONDON (AFX) - Rod Eddington, chief executive of British Airways PLC, said the airline is well placed to respond to military conflict in Iraq with both business and operational contingency plans.

"We stand ready to adjust our business appropriately if there is a conflict in the Middle East. We hope there won't be but if there is we'll respond accordingly," he told reporters in a conference call.

He was speaking after BA released better-than-expected third quarter to Dec 31 2002 results, forecast a year to end-March 2003 profit, but cautioned it does not anticipate any revenue growth over the next 12 months.

Eddington explained that the most important contingency is the accumulation of a 1.756 bln stg cash "war chest".

He also pointed out that 90 pct of the airline's fuel requirement is hedged to March 2003 and 50 pct hedged to June 2003.

"We're as well placed as we can be in these circumstances," he said.

Eddington would not be drawn on the possibility of BA instigating restructuring and disposal plans beyond its current 'Future Size and Shape' programme if there is prolonged conflict in the Middle East.

FSAS, launched in February, aims to reduce costs by an annualised 450 mln stg by March 2003 and 650 mln stg by March 2004, mainly from capacity cuts, headcount reduction and lower distribution costs. BA has a target of 10,000 fewer full-time equivalents by March 2003 and 13,000 fewer by March 2004.

"We're half way through the FSAS programme and to be frank our focus is on delivering the other half," said the chief executive.

BA's yields (average fares), which fell 4.5 pct in the third quarter, remain under pressure in the fourth quarter, particularly in the premium business sector, said Eddington.

"Given the threat of war which hangs over the global economy and the airline industry particularly, it's impossible to say anything definitive about the pricing environment in the next two or three months," he explained.

"If you look at our results, yields were down. That reflects the pressures we're under and clearly given the uncertainty that's out there it's not going to change in the very short term."

At 10.15 am shares in BA were down 1-3/4 pence at 114-1/2. The stock has come off a 2002 high of 254 pence.

james.davey@afxnews.com

Hmmmmmm ..... not so good for Ryanair


Ryanair refuses to let Para on flight despite military ID
By Benedict Brogan, Political Correspondent Telegraph
(Filed: 10/02/2003)


Ryanair, the low-cost Irish airline, has become involved in a row with the Government after refusing to allow British soldiers on standby for the Gulf to board flights using their military ID cards.

Three Cabinet ministers have been drawn into the argument, with threats of a Ministry of Defence boycott of the airline and complaints that the Dublin-based company is discriminating against servicemen facing action against Iraq.

The dispute follows the airline's refusal to recognise the Armed Forces card carried by a member of the Parachute Regiment, who was booked to travel from Glasgow to London to rejoin his unit after a 24-hour home leave.

joint house broker Merrill Lynch repeated its 'buy' stance, while WestLB Panmure reiterated its 'outperform' recommendation. Schroder Salomon Smith Barney repeated its 'in-line, high risk' stance. In a note to clients the broker pointed out BA's downbeat outlook statement had been expected given weak economies and the prospect of war in Iraq. "These results reinforce our view that BA is the best positioned among the flag carriers to benefit from an eventual return to normal economic and political conditions, because of its aggressive capacity, cost and balance sheet management actions, while reducing its risk in the current environment," it said.

What's this I heard about '0%' revenue forcast for BAY, by BAY, whether or not there is a war? Hmm. ;oO

This is not a bad summary of the current situation


02/10 17:11
British Airways' Eddington Sees `Tougher' Times Ahead (Update9)
By James Regan


London, Feb. 10 (Bloomberg) -- British Airways Plc Chief Executive Officer Rod Eddington said this year will be ``tougher'' than 2002 after Europe's largest airline had to cut 9,200 jobs, drop routes and sell four planes to eke out a third-quarter profit.

Net income in the three months ended Dec. 31 was 13 million pounds ($21 million), or 1.2 pence a share, compared with a net loss of 144 million pounds, or 13.4p, a year ago. The airline will see no revenue growth in the next 12 months, Eddington said.

British Airways plans to cut its workforce 23 percent by March 2004 to counter a slump in air travel after the Sept. 11 attacks and a drop in business traffic. It's lowered short-haul ticket prices to compete with Ryanair Holdings Plc and other low-fare rivals, and built up cash reserves to weather a further decline in demand if there is war with Iraq.

``The problem is all they can do is focus on managing the costs,'' said Colin Morton, who helps manage $260 million at BWD Rensburg and hasn't owned the shares for about two years. ``It's a very high-risk stock.''

Shares of British Airways fell 4.25p, or 3.7 percent, to 112p. The stock's down 17 percent so far this year, compared with a 9.2 percent drop in the U.K. benchmark FTSE 100 Index.

``The route to profitability in the short term is going to be through cost reduction,'' said Chris Tarry, an independent aviation analyst, in an interview. ``Corporate travel budgets are going to remain under pressure for a long time yet.''

Falling Yields

The decline in business travel and the slowing global economy resulted in a 4.5 percent fall in yields, a measure of how much revenue the airline gets per passenger, in the third quarter. The carrier filled 70.9 percent of its seats, a year-on-year increase of 5.7 percentage points, after it cut capacity 1.8 percent. Sales rose 1 percent to 1.86 billion pounds in the third quarter.

``Yields were down -- that reflects the pressure we are under,'' Eddington said on a conference call with journalists. ``The current calendar year is a difficult one to read'' because of ``the threat of war, economic uncertainty'' and competition.

The carrier said Feb. 5 it had a 1.8 percent drop in traffic last month, led by a 7.6 percent decline in premium traffic. Economy- class traffic dropped 0.8 percent. Low-cost rival Ryanair, Europe's No. 2 no-frills airline, said the number of passengers it flew last month, which doesn't take account of distance flown, rose 55 percent.

``BA's profitability relies heavily on a turnaround of North Atlantic routes,'' said Morgan Stanley analyst Martin Borghetto, who rates the stock ``equal-weight.'' ``Whilst management is working hard to retain cash and to improve the debt position, a further downturn on North Atlantic routes would translate into significant downside risk for BA's earnings and cash flows.''

Competitors

Rival full-service European carriers have also suffered from a drop in demand for air travel. Amsterdam-based rival KLM Royal Dutch Airlines NV, Europe's No. 4 airline, has said it expects a second consecutive fiscal-year loss. Deutsche Lufthansa AG, Europe's third- biggest carrier, is calling 2003 a ``difficult year.''

Eddington said the company's total costs for the last 12 months are 1 billion pounds lower than the previous year, following the publication of its Future Size and Shape strategy review in February 2002. This ``demonstrates the determination of our people to deliver,'' he said.

The company said it expects to post a profit in the fiscal year ending March 31, reversing a 142 million-pound loss in fiscal 2002, ``in the absence of hostilities in the Middle East,'' though it sees no growth in revenue in the next 12 months.

Cash Reserves

``What we have been doing is accumulating our cash reserves'' to ensure ``we have got a war chest should we need one,'' Eddington said. The company's cash inflow was 1.1 billion pounds during the nine months through December.

During the third quarter, British Airways disposed of two Boeing 757-200 aircraft, one Boeing 737-400 and one de Havilland Canada DHC-8 plane. The company also grounded two Boeing 737-300s and one Boeing 737-400. It took delivery of six Airbus SAS A320 planes during the period. It also dropped 21 U.K. regional routes.

The carrier said it remains on target to reduce its workforce by 10,000 employees to 46,500 by the end of March.

British Airways's net debt was 5.19 billion pounds, down 1.11 billion pounds from March 31 and at its lowest level since Sept. 30, 1998.

The company has increased its proportion of fixed-rate debt to almost 60 percent from 25 percent, Chief Financial Officer John Rishton said on the conference call. He said 90 percent of the company's fuel is hedged through March, with half of it hedged through the first quarter of fiscal 2004.

Yields on British Airways's 250 million pounds of 7.25 percent bonds due 2016 were 11.647 percent, compared with 11.646 percent on Feb. 7. The bonds pay a premium of 7.36 percentage points above U.K. government benchmark debt of equivalent maturity.

how about a summary of the number of times you've actually flown with BA in the last year. can't be often, as you post 24hrs a day, 7 days a week!

What a strange thing to say why ..... I do posts lots but thats because I hold lots of shares - think and type very fast - have a fast broadband connection - fast laptop and a quick mind. Anyway don't worry - I don't have to work and retired many years ago.


FYI

LONDON (AFX) - BAA PLC said its seven UK airports, including Heathrow, Gatwick and Stansted, handled 8.8 mln passengers in January, an increase of 10.7 pct over January 2002 helped by strong traffic over the Christmas and new year holiday period.

Amongst the airports, passenger traffic at Heathrow was 7.1 pct higher than January 2002.

However, Gatwick has still not fully recovered from Sept 11 2001 and its aftermath. Although it recorded a 10.0 pct increase over January 2002, it was still 8 pct lower than January 2001.

The largest passenger gains were recorded at airports with the highest concentration of low cost carriers. Stansted added 30.5 pct, Edinburgh grew by 16.1 pct and Glasgow was up 10.2 pct.

BAA said all major markets recorded increases compared to January 2002.

Domestic and European scheduled traffic saw gains of 14.9 pct and 13.3 pct respectively, whilst European charter traffic added 5.4 pct.

North Atlantic routes increased by 9.0 pct, but have not recovered to levels recorded prior to Sept 11 2001. The two year comparison shows the North Atlantic market to be still 2.0 pct down.

Total air transport movements were 4.4 pct higher than January 2002. Cargo tonnage increased by 3.9 pct.

Last week BAA flagged that it expects passenger growth to tail-off in February and March. These two months are typically low months for business and leisure travel and this year there is no Easter in March