The airline reported a £52m first-half profit last year.
BA warns ‘structural change’ is necessary and is pressing ahead with revised cabin crew contracts after a court decision yesterday.
The union representing crew, Unite, had issued an injunction against the changes and a full High Court trial has been set for 1 February.
Unite still plans a ballot for industrial action this month and warns the changes being imposed from 16 November will ‘damage customer service and hit the brand’.
BA chief executive, Willie Walsh, said: ‘The changes for existing cabin crew involve no alteration to any part of their contract of employment.
'There are no reductions in base salary and payment of incremental increases, worth between 2-7% for more than 10,000 crew, are going ahead. Overall, 75% of existing crew benefit from these incremental increases.
‘We urge Unite to withdraw its plans for an industrial action ballot and resume discussions with us on other ways of ensuring that we get into the right shape to secure long-term profitability in the interests of our customers and all our staff.’
In the six-month period, BA’s revenue was down 13.7% while total operating costs fell 8.7%.
Walsh admitted costs are ‘well out of line’ with competitors and added: ‘It’s imperative we continue to deliver on our plans to reduce costs further in the second half.
‘With revenue likely to be £1bn lower this year, we can’t stand still and further cost reduction is essential.’
Summer capacity was cut by 3.5% and staff levels by 1,900 through reduced overtime, increased part-time working and targeted voluntary redundancy.
For winter, BA is targeting a slightly higher capacity cut of 6% than the 5% previously announced, and making further staff reductions of 3,000 by March 2010.
The fall in premium passengers on short-haul routes means BA is likely to switch to a single-class service from Gatwick 'sooner rather than later', but will continue to offer business class on short-haul flights at Heathrow.
Walsh added: ‘Premium leisure demand has been strong during the last six months and we’re investing in new leisure destinations with six new routes starting this winter.’
No dividend will be paid for the six-month period.
See also:
BA boss warns of ‘untouchable duopoly’ (15/10/2009)
BA/AA/Iberia in talks about EC objections (02/10/2009)
BA looks to the future (31/07/2009)
BA to save £22m by scrapping short-haul meals (29/07/2009)
BA forges ahead with LCY business route (28/07/2009)
BA to raise £600m as Q1 loss hits £100m (17/07/2009)
BA shares boosted by improved forecast (07/11/2008)