3rd Quarter Results - Part 2

British Airways PLC
09 February 2004


PART 2

CONTINUED COST SAVINGS DRIVE BETTER RESULTS


•  Q3 pre-tax profit of £125 million for the quarter

•  Operating profit of £138 million

•  Unit costs down 5.4 per cent

•  Operating margin of 7.3 per cent

•  Net debt down £2.1 billion from December 2001 peak


British Airways today reported a pre-tax profit of £125 million for the three
months to December 31, 2003 against a pre-tax profit of £25 million for the same 
period last year.

The three month pre-tax figures took the results for the nine months to a profit
of £185 million, (2002: £335 million profit).

Operating profit for the quarter was £138 million, (2002: £53 million).  For the
nine months, operating profit was £373 million (2002: £459 million).

Rod Eddington, British Airways' chief executive, said: 'We have survived the
most testing period in aviation history.  It would not have been possible
without the determination of our people to keep British Airways flying through
these troubled times, while taking £1.7 billion costs out of the business.

'These are good results and a significant improvement on last year.  They show
what we can achieve when we are focused on delivering our cost targets.  For
example, under our future size and shape programme manpower reductions stand at
12,652 against a 13,000 goal to be achieved by March 2004.

'The challenge now is to build on our achievements and deliver sustained
profitability through further cost reductions while continuing to deliver great
service.  We will continue to simplify the travel experience for customers
through greater use of new technology.

'Half of our customers now use e-tickets and at peak times our ba.com website
takes 1,000 flight bookings an hour.  Customers can also now choose their seats
and order special meals through ba.com and later this year they will be able to
change unrestricted tickets on-line.  In an average week, a quarter of a million
members of our Executive Club loyalty scheme log on to the site.

'Delivering the £300 million saving on employee costs we announced recently and
other business plan initiatives, is key to achieving a 10 per cent operating
margin.'

Lord Marshall, chairman, said: 'Security issues are having some impact on
forward bookings.  Long-haul premium volumes, however, remain above last year's
levels but short-haul premium demand remains weak.  Non-premium traffic volumes
remain very sensitive to yield.

'The continued delivery of our future size and shape strategy and the recently
announced business plan cost improvement programme, remains central to sustained
profitability.'

Unit costs improved for the seventh consecutive quarter and were down by 5.4 per
cent on the same period last year.  This reflects a net cost reduction of 2.9
per cent on capacity 2.7 per cent higher in available tonne kilometres (ATKs).

Borrowings, net of cash, short term loans and deposits, were £4,511 million at
December 31, down £2.1 billion from the December 2001 peak.

Group turnover for the third quarter at £1,891 million was up 1.8 per cent on a
flying programme 2.7 per cent larger, as measured in ATKs.   Passenger yield,
measured in revenue per revenue passenger kilometres (RPKs), in the third
quarter was down 0.8 per cent (2002: down 4.5 per cent).  Seat factor for the
quarter was up 1.8 points at 72.7 per cent on capacity which was 0.8 per cent
higher in available seat kilometres (ASKs).

Cargo volumes for the quarter were up 9.9 per cent, measured in cargo tonne
kilometres (CTKs), compared with last year.  Yields were down 10.4 per cent,
measured in cargo revenue per CTK.

Overall load factor was up 1.7 points at 68.7 per cent.  For the nine months,
overall load factor was up 0.8 points at 68.1 per cent.

February 9, 2004                                  010/KG/2004




Notes to Editors attached.





Note to Editors:


Future Size and Shape achievements:

•   Achieved £795 million of annualised cost savings against £650 million
    target by March 2004.

•   Achieved manpower cost savings of £460 million. Reduced manpower
    equivalent by12,652 since August 2001 - on track to achieve 13,000 
    March 2004.

•   Achieved £212 million savings on sales and distribution costs against
    100 million target.

•   Achieved £123 million savings on procurement against £100 million
    target.

•   Disposals of £723 million against a £900 million target by March 2004.

•   46 per cent of the lowest shorthaul leisure fares on 180 routes sold on
    line against 50 per cent target.

•   Achieved an operating margin of 7.3 per cent for the quarter compared
    with 9.8 per cent in Q2, 2.2 per cent in Q1.

A webcast of British Airways' conference call to city analysts can be accessed
via the internet  www.bashares.com - on Monday, February 9 at 2pm.


Certain information included in this statement is forward-looking and involves
risks and uncertainties that could cause actual results to differ materially
from those expressed or implied by the forward looking statements.

Forward-looking statements include, without limitation, projections relating to
results of operations and financial conditions and the Company's plans and
objectives for future operations, including, without limitation, discussions of
the Company's 'Future Size and Shape' programme, expected future revenues,
financing plans and expected expenditures and divestments.  All forward-looking
statements in this report are based upon information known to the Company on the
date of this report.  The Company undertakes no obligation to publicly update or
revise any forward-looking statement, whether as a result of new information,
future events or otherwise.

It is not reasonably possible to itemise all of the many factors and specific
events that could cause the Company's forward looking statements to be incorrect
or that could otherwise have a material adverse effect on the future operations
or results of an airline operating in the global economy.  Information on some
factors which could result in material difference to the results is available in
the Company's SEC filings, including, without limitation the Company's Report on
Form 20-F for the year ended March 2003.




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