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Chief Financial Officer’s report

Earnings per share

A basic loss per share of 32.6 pence (2008: earnings of 61.9 pence, restated) is attributable to shareholders.

Other reserves

Other reserves at March 31, 2009, were £430 million. The retranslation of foreign debt and the marked-to-market movement on fuel and currency hedges have reduced reserves by £988 million from last year. This reflects the weakness of sterling and lower fuel prices at March 31, 2009.


The Board has decided not to recommend the payment of a dividend.

Capital expenditure

Total capital expenditure in the year amounted to £712 million, down £22 million on last year. This was primarily due to reduced spend on property relating to Terminal 5 and no further investments in associates, partially offset by £122 million for the reclassification of 10 Airbus A319 aircraft from operating leases to finance leases.

£ million 2008/09 2007/08
Fleet – aircraft, spares, modifications and refurbishments(net of refund of progress payments) 584 428
Property and equipment 67 209
Landing rights and other intangible assets 61 40
Investments   57
  712 734

Capital commitments

Capital commitments authorised and contracted for but not provided for in the accounts amount to £4,805 million for the Group (2008: £3,306 million) and £4,617 million for the Company (2008: £3,301 million). The majority of capital expenditure commitments are denominated in US dollars, as such the commitments are subject to exchange movements.

The outstanding commitments include £4,793 million for the acquisition of five Boeing 777s scheduled for delivery (from 2009 to 2012), 24 Boeing 787s (from 2012 to 2016), two Airbus A318s (2009), 10 Airbus A320s (from 2009 to 2012), 12 Airbus A380s (from 2012 to 2014) and 11 Embraer E-Jets (from 2009 to 2010).

Working capital

At March 31, 2009, our total current assets and receivables were £2,346 million, compared to £3,111 million (restated) at March 31, 2008. The reduction primarily reflects adverse movements on fuel derivatives and lower trade receivables as a result of reduced credit card processing and a general decline in the economic environment.

Our total current liabilities at March 31, 2009, were £4,142 million, up £650 million from March 31, 2008.

We believe our working capital is sufficient for our current requirements.

Cash flow

Our cash, cash equivalents and other current interest-bearing deposits at March 31, 2009, were £1,381 million. This was a reduction of £483 million compared with the preceding year. The reduction was mainly due to the operating loss sustained by the significant downturn in the economy, resulting in cash flow from operating activities being insufficient to cover cash used in investing and financing activities.

Note 25 to the financial statements provides a detailed analysis and explanation of our cash flow position.

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