View Full Version : BA London Eye
Daughter had a trip to London at the weekend, with some friends, and went on the eye.She enjoyed it, a private pod with a guide. The guide told them that the eye makes more money for BA than it's European services and the lease had been extended for another 25 years.
It seems a bit fictional to me that the eye is so profitable but I have had a quick google on BA accounts and the London Eye company is excluded and European services aren't split out of the total profit.
So, does anyone know if the eye does make more money than european services????
newswatcher
3rd Oct 2005, 09:51
Earlier this year, the Eye published some figures which make different reading. It made £10.5m of operating profit in 2003, out of revenues of £36.8m. But these are dwarfed by the size of the debt to BA, which has almost trebled from the original £48m, at an interest rate of 25%!!!! BA reckons that this was justified because the cash represented "high-risk capital" at the time!
Also earlier this year, the owners of the land on which it was built tried to increase the ground rent from 65kGBP to 1mGBP!
Not sure of the share distribution, but it is also "owned" by Tussauds(Dubai?) and the architects.
BA has long claimed that the European services consistently lose money. So even if the Eye made £1 it would be ahead.
But it's just not credible that they do lose, otherwise would BA's series of efficient CEOs over the years not have ditched the lot, which take up about 80% of BA's Heathrow slots. Yes it's all down to how you allocate costs and revenues across the business (the true picture is known in internal reporting). Apparently if BA charge £300 from London to New York, and £301 for Edinburgh-London-New York, the New York flight gets the full £300 and the Edinburgh flight gets credited with £1 !!