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British Airways Reports Net Loss of $100 Million - 2003-07-31

British Airways has reported a net loss of more than $100 million in the three months ending in June. The company blames the war in Iraq and the SARS outbreak for a slump in ticket sales.

British Airways officials say the April-through-June quarter was a disaster for Europe's biggest airline.

Net losses approached $101 million, prompting BA's chief executive Rod Eddington to declare in a statement: "This is the most testing period in aviation history."

British Airways revenue dropped by more than 10 percent compared with the same time period last year. BA says passengers stopped flying because of the war in Iraq, the SARS scare and the global economic turndown.

Adding to BA's trouble was a wildcat strike by ground staff two weeks ago at London's Heathrow airport. Workers walked off the job to protest new time clock procedures. The company says it lost between $48 million and $64 million because the strike, which stranded thousands of passengers.

Mr. Eddington told British radio his company has a lot of work to do to restore public confidence. "Clearly the disruptions at Heathrow two weekends ago were terrible for our customers, terrible for our staff and terrible for our business," he said, "and we've got to rebuild. Now we've had a sensible settlement with the unions, we've got to rebuild our business, our relationship with our customers and restore trust where it broke down with our people."

BA has trimmed its workforce to 45,000 over the past two years, but Mr. Eddington said more job loses are inevitable. "We've taken something like 11,000-plus jobs out of the business in the last two years, but we still have some way to go and we must press on," he said. "We have no God-given right to survive."

He said the payroll will be cut by 2,000 more jobs this year, and more layoffs could come in 2004 if business does not pick up.