British Airways incurs £102-million loss, to cut 1,200 more jobs

British Airways, the flag-carrier airline of the United Kingdom, has posted a net loss of £102 million ($168.8 million) in the second quarter of the fiscal ended September 30, 2009.

The airline will be cutting more jobs, too.

This loss has raised the carrier’s deficit in the first half to £208 million, an almost 5-fold increase from the £42-million loss it suffered in same period a year ago, when it lost £76 million in the quarter that ended September 30, 2008.

Willie Walsh, CEO of British Airways, said in a statement that the aviation sector still “remains in recession” and that there are still “no green shoots of recovery” in the aviation industry.

He warned that cost-cuts have become essential and the airline will introduce more structural changes in the current semester. The cost-cutting steps will include reducing the winter capacity by 6% instead of the 5% cut planned initially as well as further reductions in manpower of 3,000 employees by March 2010. This will be apart from the 1,900 jobs done away with in the first half of the fiscal.

The total 4,900 jobs now planned to be eliminated by the end of the fiscal year on March 31, 2010, will include 1,200 job-cuts more than those announced initially.

At present, British Airways employs 38,704 people.

Changes in the working conditions of the cabin crew will come into force on November 16, 2009, Willie Walsh said. However, the labour union has asserted that 14,000 flight attendants of British Airways have not accepted the company’s terms.

On his part, Willie Walsh stressed that British Airways will do everything it can to “re-engage” the union, but added that that the airline must “continue to reduce our cost base.” The company is facing “structural change” and hence “we must respond with a structural change to our cost base,” Walsh explained.

While British Airways’ revenues for the first half of the fiscal dropped by 13.7% to £4.1 billion, operating costs fell by 8.7% to £4.21 billion.

According to Willie Walsh, operating result for the reporting period – including £48 million in restructuring costs – got “reversed” to a loss of £111 million from the profit of £140 million achieved last year. The operating deficit for the second quarter was £17 million.

He disclosed that deliveries of the Airbus A380 Superjumbo aircraft to British Airways will be delayed further. According to the changed plan, the first Airbus A380 is scheduled to be handed over to British Airways in 2013.

British Airways had, in July 2009, announced that it “extended” the arrival schedule for the first 6 of its 12 Airbus A380 planes by an average of 5 months.

The airline expects to get its first Airbus A380 plane in the spring 2012, ahead of the Summer Olympic Games to be held in London, according to Willie Walsh.