First half financial results announced (02/11/2007)

British Airways World Cargo has reported commercial revenue (flown revenue plus fuel surcharges) of £290.4 million for the first half of the financial year beginning April 2007. This is a reduction of 8.8 percent compared to the same period last year and down 5.3 percent after the effects of exchange rate movements are removed.

Cargo capacity measured in available tonne kilometres (ATK) decreased by 4 percent compared to the same period last year, with volumes down by 1.6 percent to 2,365 million cargo tonne kilometres (CTK).

Overall yield (commercial revenue per CTK) fell by 3.8 percent excluding exchange effects.

Sean Doyle, financial controller, comments: "This has been a solid volume performance under challenging market conditions and shows a quarter-on-quarter improvement. While capacity has been reduced, predominantly as a result of the withdrawal of the fourth longhaul freighter last year, our load factor has improved, showing that we're filling aircraft more effectively.

"The decline in yield reflects lower levels of fuel surcharges compared to the same period last year and a change in our destination mix due to falling demand for North America destined freight. We've seen good volume performance out of the US, Asia Pacific and the Middle East and a solid recovery in Japan. Volumes from Europe are encouraging but yield is under pressure and the UK is experiencing strong volume and price pressure."

Steve Gunning, managing director, adds: "The first half and the second quarter results in particular show a steady and encouraging recovery in our revenue performance. We've seen a 17 percent increase in our premium product volumes compared to the same period last year, showing that our focus on premium freight is working well and has helped offset a more severe yield decline in general freight.

"Looking ahead, we'll continue to concentrate on increasing our profitable volumes through our premium cargo handling facility, Premia, and delivering a robust operation for our customers. From an investment perspective, the second quarter saw the launch of our new loyalty programme, LIFT, for our significant regional customers, which has been well received across the globe. Our shorthaul and longhaul freighters continue to perform well and we're on track with our preparations for the move to Terminal 5, having entered the critical 'trial and test' phase prior to the opening in March 2008."