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Essay / Research Paper Abstract
This 5 page paper looks at the performance of British Airways up to an including the end of 2002. The paper considers the financial strategies that have been undertaken and the results they have produced. The bibliography cites 5 sources.
Page Count:
5 pages (~225 words per page)
File: TS14_TEbrita1.rtf
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Unformatted sample text from the term paper:
has suffered greatly following the disasters of September the 11th 2001 and the attacks on the World Trade Centre and the Pentagon. The requirements have been to cut capacity. The
industry as a whole, well as British Airways (BA), have seen demand fall and as a result the company has been in excess of demand. With high overheads, the need
has been to cut costs as a result of lower income, which has meant cutting capacity and also cutting jobs. The overall performance of 2002 has seen a drop
in revenues of $1 billion. However, expenses have only fallen by $.5 billion and as such the loss of $200 million for 2002 was not surprising (Wall Street Journal, 2003).
The loss was projected and allowed for in the short term strategy when the impact was known. One element top begin with was the company., well known for a string
dividend history, even when trading in adverse conditions, cut the dividend to zero (Wall Street Journal, 2003). This was the first time in many years as BA was a company
that used extensive dividend signalling. However with the falls it was seen as prudent to protect the interests of the company and the shareholders to retain the money within the
company rather than pay out dividends. The share price tends to reflect this and only the string form of EMH theory. The need to decrease costs and increase income
have been the focus of much strategy that impacts with the financial strategy. An alliance with SN Brussels has been allowed to go ahead and initiate code sharing, this
is a strategic alliance that may help both companies increase passenger numbers by granting customers access to across both companies flights (Baker, 2003). The way in which the crisis
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