British Airways chairman backs profit target ? if no Iraq war

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British Airways chairman backs profit target =97 if no Iraq war

NEW YORK (Reuters) =97 The chairman of British Airways, Europe's largest=20
airline, said Tuesday the airline is comfortable with its profit forecast=20
for the current fiscal year so long as war is avoided in Iraq, and sees no=
=20
need to cut jobs beyond the 13,000 in its current plan. In an interview=20
with Reuters, Chairman Colin Marshall also backed the company's view of=20
flat revenue for its fiscal year beginning in April, and said British=20
Airways has more than $3 billion (1.89 billion pounds) of cash and=20
available credit.
"On any competitive basis, we're certainly in good shape to come through=20
any war," he said. "We certainly believe that our survivability is very=20
high indeed, perhaps a lot higher than many of our competitors." Marshall,=
=20
however, suggested that it might be difficult to boost the company's fallen=
=20
share price in light of what he called the probability of a U.S.-Iraq war.=
=20
"To attempt to boost our share price with the overhang of war would be a=20
wasted effort on our part," he said. British Airways' shares closed Tuesday=
=20
on the London Stock Exchange at 102.51 pence, down 3.25 pence, and have=20
dropped more than 60 percent from their 52-week high. Marshall spoke in an=
=20
interview after dedicating a renovated British Airways Terminal 7 at John=20
F. Kennedy International Airport in New York.

SEPT. 11 HITS HARD
British Airways on Feb. 10 posted a third quarter pretax profit of 25=20
million pounds ($39.7 million) on revenue of 1.86 billion pounds ($2.97=20
billion), helped by cuts in jobs, routes and flight capacity. The company=20
had 5.2 billion pounds ($8.26 billion) of debt as of Dec. 31. The Sept. 11=
=20
attacks hit the airline hard by damping travel on its key North American=20
routes. British Airways has cut ticket prices in the face of pressure from=
=20
low-cost airlines such as EasyJet Plc and Ryanair . Marshall said demand=20
for leisure travel remains "reasonably good," while "it's a tough market"=20
for business travel. On Saturday, British Airways said it will slash costs=
=20
an extra 450 million pounds ($714 million) a year by March 2005, on top of=
=20
an existing program to deliver annual savings of 650 million pounds ($1.03=
=20
billion) by March 2004. The airline will have pared 10,000 jobs by March=20
31, and expects to cut 3,000 more the following year, Marshall said. While=
=20
saying that war might hurt the airline's business "for the short term and=20
maybe the medium term," Marshall is focusing most intently on this month.=20
"What worries me most is these next few weeks, with this anticipation of=20
the probability of war and what the effects can be," he said.


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