Interim Rslts 2000-2001 Pt. 2

British Airways PLC
6 November 2000

PROFITS CLIMB TO £200 MILLION AS FURTHER
STEPS OUTLINED TO IMPROVE PERFORMANCE

-    Pre-tax profits up 400 per cent on a year ago, well
 ahead of expectations

-    Operating result advances 125 per cent in quarter
 and 71per cent in half-year

-    Yield shows record 8.7 per cent improvement

-    Costs held despite 5763 per cent rise in fuel prices

-    Interim dividend maintained at 5.1 pence a share

-    Package of measures to turnaround European
 performance, including sale of Go
     
London, Monday, November 6, 2000:   British Airways today
announced a 400 per cent lift in second quarter pre-tax
profits, up from £40 million a year ago to £200 million
this year - and outlined a series of steps to improve the
group's performance further still.

The three-month figures took the result for the half-year
to September 30, 2000, to £150 million, well ahead of
market expectations.

Operating profit for the quarter rose 125 per cent to
£264 million. The figure for the six months was to £361
million, up 71 per cent.  Margins in the second quarter
doubled to 10.3 per cent.

On the strength of this performance the Board is
maintaining the interim dividend at 5.1 pence a share.

Group turnover in the six months rose 4.9 per cent to
£4,862 million on a flying programme down 3.3 per cent in
terms of available seat kilometres.

Premium traffic rose 7.7 per cent, with product
innovations like the flat beds in Club World winning
significant extra market share.

Yields in the second quarter showed the airline's biggest
ever year-on-year improvement, up 8.7 per cent.

While the airline has hedged more than 80 per cent of its
fuel for the current year, higher costs have impacted on
profitability, accounting for an additional £61 million
on a year ago in the second quarter,   a 32 per cent
rise.  Despite this, efficiencies elsewhere contained
overall unit costs to a marginal increase of just 0.8 per
cent.

Rod Eddington, Chief Executive, said: 'These are an
encouraging set of results that show our strategy to
improve performance is beginning to deliver results.  But
there are still challenges ahead.
         
'We are taking a ruthless approach towards poorly
performing routes and assets.  Those not adding value are
being removed.   It is imperative that each of our
aircraft generates shareholder value.

'Meantime we are continuing to invest in products and
services that will enhance customer loyalty and enable us
to continue to support  our average yield.'

Lord Marshall, the Chairman, said: 'These figures
demonstrate an excellent improvement, reflecting British
Airways' strengthening fundamentals and improving market
conditions.  Sharpening our focus on the more profitable
parts of our business should continue this trend.'

Further measures to improve European performance

British Airways also today outlined a series of steps to
improve performance further still, with the focus falling
mainly on its European activities:

-    Schedule changes set in place for next summer,
 together with the delivery of more new smaller aircraft,
 will see overall capacity cut year-on-year by 10 per cent
 worldwide.  This will remove more loss-making seats from
 the business, delivering more yield gains.

-    The airline anticipates announcing in the coming
 weeks plans for its operations at Gatwick for winter 2001
 onwards.

-   The group is also planning to take steps to increase
 levels of co-operation and co-ordination between its
 various shorthaul businesses.

-    As part of this review, the Board has decided to
 sell its low-cost operation Go, which no longer fits
 inside British Airways' strategy.  Goldman Sachs has been
 appointed to advise on the process.

Rod Eddington said: 'The terrific response to our new
Club Europe business brand has proved that there is a
good market for our full-service European product.

'We have a number of different businesses operating
separately within Europe.  We are currently examining how
we can better rationalise and integrate their activities
to deliver better value for the group overall.

'Thanks to everyone who works at Go, it is now a leading
European brand. It has made a profit every month this
year. However, given the strategic goals we have set for
the group as a whole, now is the time for British Airways
to gain the benefits of its investment and realise the
considerable value it has created in Go.

'Overall, the steps we are taking strengthen the strategy
that will make British Airways a more focussed business,
one that offers a better service to customers while
improving profitability.'

Notes to editors

-     Copies  of  the summary interim statement  will  be
 issued  to  all shareholders through the medium  of  the
 British  Airways Investor newspaper. Copies of the  full
 interim   report  are  available  from   the   Company's
 registered  office and on the internet  at  www.british-
 airways.com/investor.
-    Copies of the slides used at the company's half-year
 results presentation to investment analysts thcan be
 viewed at www.britishairways.com/investor
-    Copies of this and all other press releases issued
by British Airways can be viewed at www.britishairways.com/press