ON any other day, the British Airways share price would have moved ahead quite sharply but it was unable to overcome the weakness which plagued FTSE-100 yesterday.
Last year's results were as good and prospects for the current year seem to be encouraging apart from the Asian crises.
However, what will dominate sentiment over the summer months will be the outcome of the long, drawn-out wrangling as to whether BA can share transatlantic routes with American Airlines.
The proposal has produced the highly-predictable complaints from other carriers that there would be a duopoly on many of the most lucrative routes thanks to BA's grip on landing slots at Heathrow.
A messy compromise is inevitable, with BA and American surrendering slots and the impact upon profitability difficult to evaluate for quite some time. An outright rejection by either Washington or Brussels would seem unlikely given the three large alliances already in operation.
More tangibly, BA has benefited substantially from lower fuel costs which in the final quarter alone were #55m lower than a year earlier. However, it was more willing to emphasise the impact of sterling which cost a very round #200m for the full year.
Overall growth may slow from12% to perhaps 5%, assuming that there is no savage slowdown in the American and British economies while those of Europe show improvement.
But the offsets will be the continuing cost and efficiency programme which will develop another #250m of savings in the current year and further benefits from its global link-ups with carriers such as Qantas and Canadian Airlines. Returns from the investments in Deutsche BA and Air Liberte in France will also improve.
However, the worries are whether the 2.9% fall in fourth- quarter load factor is a precursor of more problems due to the end of the USAir link-up, especially if the Far East carriers begin hefty discounting.
The nature of the stock is that it is dominated by news flow and a spate of positive items could see it a pound higher at 750p while the reverse could drop it a similar amount to 550p.
So turbulence will continue.
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