British Airways increased its profits strongly last year as strong demand for business class flights and the sale of a record share of available seats fuelled revenue growth, offsetting a big jump in fuel costs.
The airline said its short-haul operations in Europe were also back in profit for the first time in 10 years.
The profit improvement was driven by rising volumes of premium business class passengers, strong expansion on the North Atlantic and on routes to India and China and by selling a record share of available seats.
The rise in profits, which led to an 8.3 per cent operating margin, up from 7.2 per a year earlier, was sufficient to trigger the pay out of a £48 million (€70.6 million)bonus to BA's 46,000 staff.
Willie Walsh, BA chief executive, said the airline remained committed to a 10 per cent operating margin within two years.
In the last financial year to March 31st, BA increased its pretax profits by 20.9 per cent to £620 million from £513 million, helped by a strong performance in the final quarter, with pretax profits rising from a loss of £6 million a year ago to £91 million.
Revenues rose 9.6 per cent to £8.5 billion from £7.8 billion, helped by fuel surcharges on fares. Operating profits increased 26.8 per cent to £705 million. Earnings per share rose by 14.8 per cent from 35.2p to 40.4p.
The airline warned it was facing a further big jump in its fuel bill in the current financial year to March 2007 by £600 million to £2.2 billion.
The bill increased last year by 44.7 per cent to £1.6 billion. It said that for the current year, it had hedged 58 per cent of its fuel requirements at $58 a barrel.
