Press release

British Airways PLC
03 November 2006

GOOD RESULTS IMPACTED BY DISRUPTION





•         Disruption costs £100 million

•         Operating profit of £240 million before BA Connect write-down of £106
          million

•         Operating profit of £134 million

•         Pre-tax profit of £176 million

•         Revenue up 4.9 per cent

•         Agreement in principle to sell BA Connect


British Airways today announced its second quarter results ended September 30,
2006 including a one-off write down of the group's investment in its regional
subsidiary BA Connect of £106 million.

This resulted in an operating profit of £134 million for the quarter (2005: £261
million) and £345 million (2005: £437 million) for the half year giving an
operating margin of 5.8 per cent and 7.5 per cent respectively.  The pre-tax
profit was £176 million for the three months (2005: £241 million) and £371
million for the half year (2005: £365 million).

Excluding the BA Connect write-down, the operating profit for the quarter was
£240 million and £451 million for the half year giving an operating margin of
10.4 per cent and 9.7 per cent respectively.  The pre-tax profit was £282
million for the quarter and £477 million for the half year.

Willie Walsh, British Airways' chief executive, said: 'Given the significant
impact of the security disruptions, estimated at a cost of some £100 million,
these are good results. Despite the extremely difficult operational environment,
we have delivered improved revenue.

'As part of our continued efforts to improve the profitability of shorthaul we
have today announced that we have reached agreement in principle to sell the
regional business of BA Connect to Flybe. Point to point regional operations are
not a strategic part of our business and we believe that such activities are
better undertaken by a regional low cost airline.*

'Our focus on costs is working and has helped offset the revenue impact of
recent weeks.  Fuel costs in the quarter increased by nearly a third. Underlying
unit costs, excluding the BA Connect write-down and fuel, were down 1.1 per
cent.  Costs will continue to be our focus as we work towards achieving a 10 per
cent operating margin.

'This is an exciting time for our customers with the rollout of our next
generation Club World flat bed later this month.  We are also enhancing ba.com
to make it easier for our customers to book and get information about their
travel plans.  It was an invaluable tool during the disruption in August because
it gave hundreds of thousands of our customers quick and easy access to the very
latest news.

'As we have previously announced we have taken the first steps in the process
towards expanding and renewing our fleet with the launch of a competition
between aircraft and engine manufacturers.   However, we must first tackle the
£2.1 billion deficit in the New Airways Pension Scheme (NAPS). Negotiations are
progressing with the trustees and we continue to consult with our trade unions.
I remain confident that we will resolve this issue.'

Martin Broughton, British Airways' chairman, said: 'Overall market conditions
are broadly unchanged. Longhaul premium transfer and shorthaul premium traffic,
although recovering, continue to be affected by the tighter security
arrangements currently in place.  As a result, total revenue is now expected to
be 4.5 per cent to 5 per cent higher than last year, down half a per cent from
our previous guidance.

'We expect that total costs, excluding fuel, will be flat compared to last year.
Total fuel costs net of hedging for the year are expected to be some £400
million higher than last year, based on current prices and sterling dollar
exchange rates.'

'We welcome the governments announcement yesterday on the re-introduction of
liquids in cabin baggage which brings the UK into line with the rest of the EU.
We will continue to support the BAA as they work to improve the customer
experience across London's airports.'

Group turnover for the second quarter was £2,313 million (2005: £2,205 million),
4.9 per cent up on a flying programme 1.5 per cent up, measured in available
tonne kilometres (ATKs).  Traffic volumes, measured in revenue passenger
kilometres (RPKs), were up 3.6 per cent.  Seat factor was up 0.1 points at 79.7
per cent on capacity 3.4 per cent higher in available seat kilometres (ASKs).
Yield measured in pence per RPK was up 2.2 per cent.

Reported unit costs increased by 10.5 per cent on the same period last year.
Unit costs excluding the BA Connect write down and fuel, were down 1.1 per cent
on capacity 1.5 per cent higher in ATKs.

Fuel costs increased by 30.2 per cent to £534 million due to the increase in
fuel prices.  Employee costs were up 1.4 per cent due to increased pension costs
partially offset by management headcount reductions.

Operating cashflow for the six months was £439 million (2005: £530 million).
Including current interest bearing deposits, the cash position at September 30,
2006 was £2,633 million, up £193 million compared with March 31, 2006.  Net debt
was £1,125 million, down by £516 million since the start of the year.

The board has decided that no interim dividend will be paid.

                                      ends


November 3, 2006
                              111/KG/06

Note to Editors:

* See separate release on BA Connect.

British Airways' presentation to city analysts can be accessed via the internet
www.bashares.com at 9am.  A webcast of British Airways' conference call to city
analysts can also be accessed via the internet www.bashares.com at 2pm.

Certain information included in these statements 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 Business Plan programs, 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 itemize 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 2006.

The estimated cost of the new security measures introduced in August reflects
the direct cost of the measures and the estimated revenue impacts, both direct
and indirect. The estimate of £100 million is based on assumptions the company
considers reasonable, but are judgemental.

                      This information is provided by RNS
            The company news service from the London Stock Exchange