BA warning of 150 million pound loss for year

British Airways announced that a loss of approximately £150 million was now expected for 2008, after operating costs rose more steeply than had been expected.

The airline cited currency movements for the eight per cent increase in costs other than fuel, as compared with the five per cent estimated earlier.

Results for the carrier’s third quarter, ending 31 December, showed an operating loss amounting to £50 million, making it likely that the deficit for the year ending on 31 March will reach £150 million.

The drop in the value of the pound has impacted the airline in aircraft leasing, in particular, which is paid for in US dollars.

The airline added: “Further economic weakness in January and the outlook for February and March combined with the fall in sterling, are impacting our outlook for the year ended March 31 2009.”

Revenue guidance for the year remains unchanged, the carrier noted, with a four per cent year-on-year increase expected. It is also anticipated that fuel cost estimates will remain unchanged, at approximately £3 billion, as lower fuel prices are offset by a reduction in hedging benefits and currency exchange impacts.

In November, BA said that it was hoping to make a small profit in its 2008-2009 financial year.

Thanks to www.theherald.co.uk for the above quotes, for more information on this article please visit their website.

www.britishairways.com