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British Airways
- IATA/ICAO Code:
- BA/BAW
- Airline Type:
- Full Service Carrier
- Hub(s):
- London Heathrow Airport, London Gatwick Airport
- Year Founded:
- 1974
- Alliance:
- oneworld
- Airline Group:
- IAG
- CEO:
- Sean Doyle
- Country:
- United Kingdom
Earlier today, the International Airlines Group published its Q2 results. With IAG being the parent company of British Airways (among other airlines), the report highlighted the UK flag carrier's financial performance. The last quarter ended up being a successful one for BA, which has returned to profit after three years.
Back on track
A key headline from the report, which also confirmed that British Airways won't receive its first Boeing 777X until 2026, was that, with an operating result of £54 million ($65.7 million) for Q2, BA has made a profit for the first time since 2019. This marks an encouraging milestone for the UK flag carrier, which, like many other airlines worldwide, has faced a plethora of challenges in recent years.
The profit is the result of a total quarterly operational expenditure sum of £2.683 billion being offset by total revenue for the period of £2.737 billion. While £54 million is a far smaller profit than that experienced by British Airways in Q2 of 2019 (£526 million), the airline is much better off than last year, when it lost £566 million in Q2.
Overall, the carrier's operation costs are down by 9% compared to Q2 in 2019, when its quarterly expenditure in this regard was £2.937 billion. A key factor in this has been a 25% drop in employee costs, with this sum having fallen from £666 million to £498 million. Of course, having fewer staff has also contributed to operational issues, with BA having made cuts to its summer schedules due to shortages.
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Cargo continues to exceed pre-pandemic levels
While British Airways remains a passenger-focused airline, the coronavirus pandemic has seen cargo play an increasingly important role in its day-to-day operations. This has been the case for man carriers worldwide, who turned to airfreight as a means of keeping otherwise dormant aircraft active amid low passenger demand.
As a result of this, the Heathrow-based airline's cargo revenues are exceeding 2019 levels. While not quite as high as last year (£279 million), the £266 million that BA generated in cargo revenue in Q2 of 2022 represented a 48% increase compared to the £180 million made by carrying airfreight in the second quarter of 2019.
As for passenger revenue, this still remains below pre-pandemic levels, with the £2.277 billion generated this time around being 27% lower than the £3.112 million made in Q2 of 2019. Nonetheless, the oneworld member is in a stronger position than last year, when it generated just £203 million in passenger revenue in Q2.
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Healthy load factors
With air travel being far less heavily restricted than it was a year ago, passengers have been flocking back to British Airways. This is particularly evident when it comes to holiday traffic, with IAG's report noting that "leisure demand continues to outpace capacity." This resulted in a healthy load factor of 80% in the last quarter.
Even before the pandemic, BA's planes weren't typically completely full, with Q2 of 2019's load factor only being slightly higher, at 84%. Meanwhile, the figure for the same period last year was just 40%. As such, the fact that this has doubled within 12 months is surefire evidence of British Airways enjoying a sustained recovery.
What do you make of British Airways' latest financial results? Did you fly with the UK flag carrier in the last quarter? Let us know your thoughts and experiences in the comments!