British Airways Financial Analysis

British Airways Financial Analysis

Length: 412 words (1.2 double-spaced pages)

Rating: Excellent

Open Document

Essay Preview

More ↓
British Airways Financial Analysis


The following pages comprise of a financial analysis of British Airways for the financial year ending March 31, 1999.

British Airways is a well-established company and has enjoyed high profits for the majority of its existence. However, the most recent accounts that have been published tell a different story of how the year has been.

British Airways produced a pre-tax profit of £225 million. This is £355 million less than in 1998 which illustrates the decline in demand for British Airways services. Although this decline in profits of 61% seems unacceptable it was caused by a variety of abnormal expenses. For example the company spent £35 million on computer systems to ensure that they are “year 2000 compliant”. British Airways also entered the low cost air travel market during the year with the launch of “Go”, which is running at a loss as it tries to establish itself in a highly competitive business environment.

Lower fuel prices and the strength of the Pound benefited British Airways, and as a result the company stocked up on 45% of its fuel requirement for the next financial year. This also contributed to the fall in profits for the year.

Operating Profit Fell from £504 million in 1998 to £442 million in 1999. The return on capital employed or primary ratio was just 17.06%. This is a great deal smaller than the 1998 figure of 61.2%. These figures both show that the business is achieving a return higher than that which could be achieved in a non-risk investment such as a high interest no access bank account which would only give a return of 7 to 9%.

British Airways has a working capital of 5.1, which shows that it has high solvency. Overall, although the firm has incurred a loss of £355 million in the financial year it is still a healthy business that shows promise of high profits in future years.

How to Cite this Page

MLA Citation:
"British Airways Financial Analysis." 123HelpMe.com. 20 Jun 2019
    <https://www.123helpme.com/view.asp?id=47572>.

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Marketing Strategies for Emirates Airlines and British Airways Essay examples

- Objectives of the Report The focus of the report is on the various strategies adopted by the two airlines viz. Emirates & British Airways in the various markets they operate and provide their service and are looking for growth opportunities across globe. o Intercepting various strategies adopted by the airlines with regards to marketing in different countries o Regional differences and Cultural factors o SWOT analysis for each airlines o Porters Five Forces acting upon each airline   EMIRATES Emirates is a Dubai, United Arab Emirates, based airline and is one of the subsidiaries of the Emirates Group which is owned by the Government of Dubai’s Investment Corporation....   [tags: Analysis of British Airways]

Research Papers
1741 words (5 pages)

Essay about British Airways Case Study

- Introduction British Airways is the one of the largest airline companies, and the passengers carry overall in the fifth largest in the world. Most of plans are stay in Heathrow Airport which is the highest of main international airport. The British Airways has a long history and airlines cover 133 countries; include 373 airplanes. The BA Company includes 50,086 workers to be in the service, which is one of the largest employers and employees in the United Kingdom. British Airways (BA) is based on the British flag carrier airline, based near London Heathrow Airport, the main center is near the Gulf....   [tags: SWOT and PEST]

Research Papers
3081 words (8.8 pages)

PEST Analysis on British Airways Essay

- PEST Analysis on British Airways The four different environments are often referred to as PEST and allow a PESTanalysis to be conducted this allows the organisation to review and consider the environment in which it operates. The PEST factor that has contributed to the airlines industry for many years, but has brought a drastic change was from the disaster on September 11th 2001. Political environment concerns the role of the government and its affects in an organisation it also includes the extent to which the government intervenes in the economy....   [tags: Economics Business Air Essays Papers]

Research Papers
810 words (2.3 pages)

Essay on Analysis Of The Success Of Cultural Change Within British Airways

- 1.1INTRODUCTION British Airways came into existence in 1935, when smaller privately owned UK airlines merged. Another change occurred when the Government nationalised British Airways and Imperial Airways to form BOAC - The British Overseas Airways Corporation. During this period, external markets were more stable and predictable and there was no real need for BA to adopt competitive strategies, being that there was little competition from rivals. There appears to be little in the way of strategy formulation and strategy implementation....   [tags: essays research papers fc]

Research Papers
5966 words (17 pages)

A Quantitative and Qualitative Look at Southwest Airlines and British Airways

- A Quantitative and Qualitative Look at Southwest Airlines and British Airways In today's competitive marketplace, all firms are seeking ways to improve their overall performance. One such method of improvement, recently adopted by many firms, is benchmarking. Benchmarking is a technique used to evaluate internal business processes. "In this analysis, managers determine the firm's critical processes and outputs, baseline those processes, then compare the performance of each process against a standard outside the industry" (Bounds, Yorks, Adams, & Ranney 1994)....   [tags: Airlines Marketplace Aviation Benchmarking]

Free Essays
4260 words (12.2 pages)

Analysis of the Internal Environment at Qantas Airways Limited Essay

- Qantas Airways Limited (Qantas) is an Australian based airline group, engaged in the operation of both domestic and international air transportation services. Qantas, with revenue of almost sixteen billion dollars in the 2013 Australian financial year (Qantas Airways Limited, 2013), competes in four main market segments with business units including Qantas Domestic, Qantas International, Jetstar and Qantas Loyalty. Within these business units, Qantas also operate a range of synergistic subsidiaries including Q Catering, which provides food and beverage services of all its airline business along with Q Freight, Australia’s largest independent air freight services Supporting the airline operat...   [tags: australian airline, air transportation services]

Research Papers
1153 words (3.3 pages)

Analysis of British Airways Essay

- TABLE OF CONTENTS PAGE 1. British Airways: Overview 4 2. Key stakeholders 4 3. Mission and objectives 5 4. Market structure 6 5. Managing diverse cultures 7 6. Economic changes, fiscal and monetary policy 8 7. Regulation 11 8. Conclusion and Recommendations 12 9. References 14 Executive Summary British Airways has focused its mission and objectives towards satisfying its key stakeholders that include employees, customers, Government and the British public. The company has been successful in dealing with cultural differences that arise between the UK and foreign countries, adopting a geocentric approach to hiring workers....   [tags: British Airways Case Study]

Research Papers
3318 words (9.5 pages)

The Cause of Financial Distress in Airlines Industry Essays

- The Cause of Financial Distress in Airlines Industry Introduction According to International Air Transport Association (IATA), global airline industry has a history of 100 years (2014). Today, there were more than 3 billion passengers and 50 million tonnes of cargo reach their destination through the wonder of flight every year, supporting over 57 million jobs and $2.2 trillion in economic activity (IATA, 2014). The airline industry plays a crucial role in economic because it helps in opening up new possibilities for tourism, business, and human connections, as well as affecting aircraft manufacturers....   [tags: aviation, overcapacity, business analysis]

Research Papers
1357 words (3.9 pages)

Essay on The Business Environment For Qantas Airways Limited

- 6.0 EXTERNAL ANALYSIS The industry for Qantas Airways Limited is a company that guides a long distance in airline, which is in international and domestic location. Qantas Airways Limited is a company that established as a world airline that comes from Australia. 6.1.0 GENERAL ENVIRONMENT ANALYSIS General environment was the most environment need to cover up and adapt to doing business, which is the business is stable or not. To determine the general business environment for Qantas Airways Limited company, there need to know a several factor which is the economy, social cultural, global, technological, political-legal and demographic factors....   [tags: Airline, Qantas, British Airways, Oneworld]

Research Papers
1587 words (4.5 pages)

British Airways PLC British Airways Essay

- British Airways PLC British Airways British Airway’s PLC is the largest international airline in the world. It is based at Heathrow airport in London, the busiest international airport in the world, and has a global flight net-work through such partners as USAir in the United States, Qantas in Australia, and TAT European airlines in France. Via its own operational and those of its alliance partners, British Airways serves 95 million passengers a year, using 441 airports in 86 countries and more than 1,000 planes....   [tags: Business Management Studies]

Research Papers
1536 words (4.4 pages)

Related Searches

This is due to a variety of things such as investment into other market segments, such as ‘Go’. The company is well managed, this is shown by the anticipation of fuel prices rising again and so stocking up on reserves to benefit form the low price and the strength of the Pound. British Airways board of director’s decision to propose a Dividend of 17.9 pence per share also reflects my views, which is higher than the 1998 dividend of 16.6 pence per share even though the firms profits were down.
Return to 123HelpMe.com