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Chief Financial Officer’s report

After a strong start to the year, our cargo revenue in the second half felt the impact of both lower levels of fuel surcharges, as the oil price fell, and lower demand, as the economic slowdown took hold.

Our cargo volumes, measured in cargo tonne kilometres (CTKs), were down 5.2 per cent from the previous year on capacity, measured in available tonne kilometres (ATKs), down 2.5 per cent. Premium product volumes declined by 2.1 per cent, less than the decline in general freight. Our cargo yield (revenue per cargo tonne kilometre) increased by 15.4 per cent, driven by higher levels of fuel surcharge compared to last year, together with exchange effects.

Similar to the passenger business, our cargo revenue benefited from exchange during the year. Overall revenue for the year was £673 million, up 9.4 per cent on the prior year. Excluding the impact of exchange, it was up only 1.3 per cent.

Overall, the load factor for the year was 72.0 per cent, down 1.4 points on last year.

£ million 2008/09 2007/08* Better / (worse)
Employee costs (excluding restructuring) 2,193 2,165 (1.3)%
Restructuring 78 1 nm
Depreciation, amortisation and impairment 694 692 (0.3)%
Aircraft operating lease costs 73 68 (7.4)%
Fuel and oil costs 2,969 2,055 (44.5)%
Engineering and other aircraft costs 510 451 (13.1)%
Landing fees and en route charges 603 528 (14.2)%
Handling charges, catering and other operating costs 1,021 977 (4.5)%
Selling costs 369 361 (2.2)%
Currency differences 117 6 nm
Accommodation, ground equipment and IT costs 585 576 (1.6)%
Total Group expenditure on operations 9,212 7,880 (16.9)%
Total Group expenditure excluding exchange 8,471 7,880 (7.5)%
Total Group expenditure excluding fuel and exchange 5,843 5,825 (0.3)%

*Restated for the adoption of IFRIC 13 and 14.

Cargo revenue


Overall revenue for the year was £673 million, up 9.4 per cent on the prior year.

“Significant pricing actions were required to stimulate non-premium traffic volumes, which were broadly unchanged year on year.”
Chart of total revenue £ million

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