Statement re Q1Results

British Airways PLC
7 August 2000

FIRST QUARTER RESULTS MEET EXPECTATIONS

British Airways today (Monday August 7) announced a pre-
tax profit of £8 million, before disposal losses of £58
million, (Q1 1999: £23 million) for the three months to
June 30, 2000, in line with market expectations. A pre-
tax loss of £50 million resulted.

Operating profits for the period were £97 million
(1999: £94 million), in spite of significantly higher
fuel costs.

Group turnover for the three-month period was up four
per cent, at £1,943 million, on a flying programme 2.2
per cent less in available seat kilometres (ASKs) in
line with the group strategy. The revenue outlook for
the key summer season continues to give cause for
cautious optimism, with lower capacity growth in most
market segments supporting yields and seat factors.

Yields continue to improve with a 2.9 per cent year-on-
year increase. Premium traffic is showing good growth,
rising by 8.1 per cent in the quarter, and cost
efficiencies continue to be delivered. Whilst British
Airways has hedged over 75 per cent of its current year
fuel requirements, high fuel prices continue to impact
upon profitability, accounting for an additional non-
cash cost of £76 million compared to the equivalent
period last year.

British Airways remains committed to offering the best
possible service to all its passengers and today World
Traveller Plus, a brand new class of travel for long
haul economy passengers, has opened for business.
Passengers can book seats in World Traveller Plus on
flights from London, Heathrow to New York, JFK for
travel from October 29. Customers will benefit from
their own dedicated cabin, with up to 40 wider seats
offering significantly more leg-room, in-seat PC power
and telephone, double hand baggage allowance and an
enhanced service at an affordable premium.

Discussions continue between British Airways and KLM on
the possible combination of these businesses.

Rod Eddington, Chief Executive, said: 'These results
reflect the scale of the challenge we face in a highly
competitive and price-sensitive market. However, we are
also beginning to see the benefits of the investment we
have made in every section of the aircraft. The growth
in premium traffic has been strong and yields
throughout the airline are up. The first aircraft with
the World Traveller Plus product took to the air last
Friday.'

Lord Marshall, Chairman, said: 'The increased demand in
business and leisure travel continue to have a
beneficial effect on yields and load factors. We remain
encouraged by the generally favourable economic climate
which prevails in most of our key markets around the
world. However, the effect of a persistently strong
pound on British manufacturers and the high cost of
fuel gives cause for concern.'


Notes to Editors

 The loss on the sale of Air Liberte, completed on
 May 5, 2000, was £56m.

For more information, please contact:

Simon Walker        British Airways          Tel: [phone]
Nick Claydon        British Airways          Tel: [phone]
Sarah James         British Airways          Tel: [phone]
Louise Evans        British Airways          Tel: [phone]
James Hogan         Brunswick                Tel: [phone]