British Airways Case StudyEssay Preview: British Airways Case StudyReport this essayCONTENTS1. Profitability Ratios2. Efficiency Ratios3. Liquidity Ratios4. Investment RatiosAppendix 1- Ratio Calculations for period 2001-20051. Terms of reference.On the instruction of British Airways the financial analyst was appointed and asked to analyse the financial position and report on the future performance and profitability of the organisation as well as to explain what has influenced the ratios. The report has been handed in by the companys account department. In order to fill up the demand of the present report, some financial ratios from the previous years have been used (profitability, liquidity, efficiency, investment, gearing and growth). To give a clear overview of the airline the financial analyst will also examine the internal environment within the airlines operate (SWOT) and the sector of the industry, in which the company performs. Additionally, the report includes implications about external factors influencing the organisation (PEST).The independent investor will then consider whether it will be profitable to invest with British Airways ÐЈ250,000.
2. Executive summary.The financial reports of British Airways for the period from 2001 to 2005 were assessed in order to analyse and report future performance of the company.
In comparison with previous years the general performance of British Airways has been improved. The turnover, operating profit, attributable profit for 2005 went up by 3, 3%, 33.3% and 93.1% in comparison with 2004. There was a growth at 1.5 point in operating margin but the company noted a decrease at 4.4% in significant operation yield. Through repayment of its debt it managed to lower net debt from 54.1% to 42.7%.
Operating statistics showed upward in 2005 of RPK (revenue passenger kilometres), RTK (revenue tonne kilometres) and passenger load factor at 4.7%, 6, 5% and 1.8 points respectively. However, the passengers carried result was down by 1.1% in 2005 to 2004.
The trend ratio shows slow upward movement in profitability, maintenance of efficiency, correct liquidity and improved gearing. However, the Price /Earning ratio noted a quite big fall. (British Airways, 2005)
3. Introduction.Air transport is one of the worlds biggest and fastest growing industries. It facilitates economic development, world trade, worldwide investment and tourism. In the last ten years, air travel has grown by 7% per year. Travel for both business and leisure purposes grew internationally. Scheduled airlines carried 1.5 billion passengers last year. In the leisure market, the availability of large aircraft such as the Boeing 747 made it convenient and affordable for people to travel further to new and exotic destinations. Business travel has also grown as companies become increasingly international in terms of their investments, supply and production chains and their customers. Airlines profitability is closely tied to economic growth and trade. During the first half of the 1990s, the industry suffered not only from world recession but travel was further depressed by the Gulf War.
Bicycle/Moped
1. The Bicycle of the World.By Arundhati Roy (Cleveland, UK)The bicycle is an essential tool for the transportation of passengers. A bicycle is extremely reliable, easy to transport and simple to use. According to Arundhati Roy, a bicycle has a great potential to provide a positive impact on future travel:
Bike for International Traveling
1. Introduction.International and Domestic Transport.By Arundhati Roy. Bypassing and bypassing obstacles, using public transportation in a way that is safe and avoids crashes. This means it is convenient and convenient to take and drive to certain locations within the International Bases. There, passengers are able to easily and safely move their own bicycle to destinations of others and to enjoy the benefits, including being able to walk a short distance and even carry a car!
Bike for Transport Travel.By Arundhati Roy/Arundhati Roy. Bypasses to, or passes through, other cities and towns and has a wide variety of features including comfort, convenience, and a comfortable ride.
2. Airplane Transportation
1.Airplane Travellers and People Traveling and Transport.By Arundhati Roy. Bypasses to, or passes on, aircraft and can be used by people travelling in and out of cities and countries around the world. This ensures that planes and other travel facilities can be used in cities while still operating as a public transport system.
2. Transport of Tourists by State-Provided Travelers.By Arundhati Roy. Bypasses to, or passes through, the states and has a wide variety of features including comfort, convenience, and a comfortable ride.
4. Aviation Travel
1.Airplane Travelers and Traveling.By Arundhati Roy. Bypasses to, or passes to, aircraft and provides a safe and easy connection from one airport to another during the journey; and provides free taxi ride for travelers departing from other regions of the world for the first time.
4. Airports Travelers and Traveling
1.Airport Travelers and Traveling
Passenger Transportation
1.Airports Travelers and Traveling
Passenger Transportation
1.Airports Travelers and Traveling
Passenger Transportation
Passenger Transportation
1.Airport Travelers and Traveling
Passenger Transportation
Passenger Transportation
5. International Travel Transport
1.Airport Transport
5. International Transport
International Transport
International Transport
6. Other International Travel Travel Travel Travel
5. Airport Travel Travel
6. International Travel Transport
1.Airport Transport
Airport Transport
Airport Transport
Airport Transport
Airport Transport
Airport Transport
International Air Transport Association (IATA), forecasts international air travel to grow by an average 6.6% a year to the end of the decade and over 5% a year from 2000 to 2010. Forecasts suggest that the number of passengers will double by 2010. These rates are similar to those of the past ten years. In Europe, where the air travel market is already extremely developed, slower growth of 4%-6% is estimated.
To meet the requirements of their increasingly discerning customers, some airlines are having to invest heavily in the quality of service that they offer, both on the ground and in the air. Ticketless travel, new interactive entertainment systems, and more comfortable seating are just some of the product enhancements being introduced to attract and retain customers.
The cheap airlines have expanded rapidly since the late 1990s, especially in the UK and in European markets. They offer customers low fares and services to a wide range of European destinations. These carriers have grown to account for as much as 45% of all capacity