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09.08.04, 11:37
BA doubles long-haul fuel surcharge
Press Association
Monday August 9, 2004 10:08 AM
British Airways is to more than double its fuel surcharge for long-haul
passengers after seeing oil prices continue to soar.
From Wednesday, the charge for a single long-haul flight will rise from £2.50
to £6 with the surcharge for a return journey rising to £12.
The move, which follows a 45% rise in fuel prices in the last 12 months, was
announced as BA said it had achieved pre-tax profits for the three months to
June 30 of £115 million, up from losses of £45 million a year earlier.
The first quarter performance - described as "reasonable" by chief executive
Rod Eddington - was at the top end of market expectations.
However, Mr Eddington said fuel and employee costs represented the biggest
challenges facing the airline, which is currently involved in a pay dispute
with baggage handlers and check-in staff.
It is also braced for higher pension contributions of £133 million a year.
The surge in oil prices means BA faces a fuel bill of more than £1.1 billion
in the 2004/05 financial year - £225 million more than last year and £70
million higher than estimated in May.
By increasing the fuel surcharge for long-haul customers, the company
estimates it can recoup £70 million of the extra fuel costs.
With passenger numbers on an improved trend, BA said revenues grew 5.1% to
£1.9 billion in the three months to June 30. Operating profits of £150
million compared with £40 million for the same period last year when the Iraq
war and Sars caused the "most testing period in aviation history".
Mr Eddington said: "These are reasonable results but currently fuel and
employee costs remain our biggest challenges."
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