British Airways, Europe's largest airline, has said it faced "testing times" and expected first-quarter results to reflect the sluggishness in the US economy.
"It will reflect the downturn I have already referred to," chairman Mr Colin Marshall said in a prepared speech to be given at the airline's annual general meeting.
"We are far from alone in feeling adverse economic effects, but our position is arguably more robust than many other airlines, thanks to the significant reduction in capacity flowing from our strategic plan," Mr Marshall added.
Despite the economic slowdown, BA has been hoping to fare better than some of its rivals after a long campaign of reducing capacity and focusing on the higher-margin business traveller.
Chief executive Mr Rod Eddington said in a speech to be delivered to the annual meeting that the company "must make further cost efficiencies across the airline in line with capacity reductions".
"We will achieve our goal of sustained profitability," he added.
The airline said in May it planned to cut capacity by eight to nine per cent in the financial year 2001/02.
"In line with our fleet strategy, capacity will be reduced on short-haul by using smaller aircraft, but the number of destinations served - 53 - remains the same," Mr Eddington said.
Earlier this month, BA had reported an 8.9 per cent fall in traffic in June from a year ago - just more than an 8.8 per cent drop in capacity - as trading conditions remained difficult.
"These are testing times. British Airways operates in a highly competitive world," Mr Eddington said in the statement.