BAB ,,, British Airways Report Drop in 4Q Profits
Friday May 13, 3:30 am ET
British Airways Report Drop in 4Q Profits, but the Carrier's Full-Year Pretax Profits Jumped Sharply
LONDON (AP) -- British Airways' fourth quarter pretax profits fell to 5 million pounds ($9.3 million; euro7.3 million) from 45 million pounds a year earlier, largely because of rising fuel costs, but the carrier's full-year pretax profits jumped sharply, it said Friday.
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The airline said pretax profits for the year ending March 31 hit 415 million pounds ($772 million; euro610 million), up from 230 million pounds in 2003-2004.
The increase beat analysts' expectations. Outgoing chief executive Rod Eddington credited the performance to strong demand and cost-cutting.
The long-troubled airline, which has been carrying out a major restructuring plan, said it was expecting a 400 million-pound ($744 million; euro588 million) increase in fuel costs this year, up from its earlier estimate of a 300 million pound ($558 million; euro441 million) hike.
Eddington said the airline had exceeded its 2003-2005 planned savings of 450 million pounds ($837 million; euro662 million) by 7 million pounds ($13 million; euro10 million).
He said the 6.9 percent operating margin was the best since 1997 and would trigger bonuses to workers of 1 1/4 weeks' pay.
Chairman Martin Broughton said revenue was expected to increase by between 4 percent and 5 percent in 2005-2006, up from an earlier estimate of 3 percent to 4 percent because of new fuel surcharges.
He said capacity and volumes were expected to increase by about 3 percent.
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