British Airways Expects Better Revenues in 2007

British Airways on Wednesday forecast a 5 to 6 percent rise in revenues for the financial year beginning April and said it expected costs to rise by $289.5 million. Both forecasts are more optimistic than those for this year, when revenues are expected to rise 3.25 to 3.75 percent and costs are seen jumping $772 million.

BA, Europe’s third-largest airline, said it expected traffic in the year beginning April 1 to rise 2.4 percent in revenue passenger kilometers (RPKs), a measure of passengers as well as the distance they fly.

By expanding capacity by a more modest 1.3 percent in available seat kilometers, BA expects to raise its yield 3.4 percent, BA said in a statement to the London Stock Exchange.

BA said its forecasts put it on track to achieve a 10 percent operating margin in the coming year, a target it has already announced. Analysts say the move would bring more airlines to London’s Heathrow Airport and give BA more competition for flights to the United States.