British Airways achieved higher- than-expected profits last year but warned that the current year would be "challenging", with the timing of an economic recovery still uncertain.

Lord Marshall, chairman, said it was "very difficult" to forecast revenue against a backdrop of continuing global economic weakness, the SARS virus and developments in the Middle East. He forecast a drop in revenue in the first three months from April to June and said "visibility beyond the first quarter is not clear".

BA said it would not pay a dividend, the second year it has failed to make a shareholder payment. It has achieved a £335 million (€469 million) turnaround in the year to March 31st, improving from a pre-tax loss of £200 million a year ago to a pre-tax profit of £135 million. - (Financial Times Service)