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British Airways profits up by 45%
16.05.08British Airways has announced annual pre-tax profits of £883 million, but warned it was braced for a "challenging" year ahead due to sky-high oil prices and following its troubled move to Heathrow Terminal 5.
The airline's profits haul, up nearly 45% on the prior year, saw it meet a 10% profit margin target, triggering a £35 million bonus pool for the airline's 42,000 staff. It is also paying its first dividend since 2001.
But BA warned delays in the move to its new flagship Terminal 5, oil prices that have doubled year on year, and general economic uncertainty, would make the coming year "challenging".
BA chief executive Willie Walsh said that he would not be taking his bonus because of the Heathrow fiasco.
He told BBC Radio 4's Today programme: "I am not getting a bonus. I felt it would be inappropriate in the context of the very disappointing opening of Terminal 5 in March.
"So despite the fact it was a record year in terms of our financial performance, I advised the chairman that I thought it would be inappropriate. I have made it very clear I was very disappointed at the way we had performed."
But Mr Walsh, who came under pressure to quit following the T5 fiasco, was more upbeat about the results for the last financial year.
He said: "This is an outstanding financial result for the company despite rising fuel prices and significant economic slowdown in the last six months.
"We have achieved our goal of a 10% operating margin which I am delighted has triggered the reward scheme for our staff. For our shareholders too, it signals the welcome return of a dividend - the first since 2001."
He added: "Delivering 10% has not been easy, but we have achieved it by remaining focused on our strategy for the last six years."
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