BA dividends hit by debt struggle
BRITISH Airways investors should not hope for an early return to dividends, warns incoming chairman Martin Broughton.
Getting debt down is a higher priority, he says. BA cut dividends three years ago. Since then it has slashed net debt from a menacing £6.6bn to a more benign £4.2bn.
Broughton says big investors are telling it to 'continue the excellent balance sheet management work - dividends in due course, but not now'.
The former boss of cigarette giant BAT takes over the BA chair from Lord Marshall at today's agm.
His 'key priority' is to see operating margins nearly double from 5.4% to 10%.
Broughton is preparing a clean sweep of the boardroom. He expects to appoint several new directors within a year.
He will also begin seeking an eventual successor to chief executive Rod Eddington, the Aussie who rescued the British flag carrier.
BA shares fell 3p to 237 1/2p.
