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British Airways has announced a pre-tax loss of £50 million in the three months to December 2009. Despite yet another quarter of loss making, it was a much smaller loss than had been expected, and as such has led many to predict the start of the recovery process of the embattled airline.

The loss that had been expected was £120 million, quite a different figure to that which BA revealed. The figure of £50 million also compares favourably to the £122 million loss that was announced for the same period in 2008.

On top of that, the quarter saw BA’s first operating profit in 15 months. The company made an operating profit of £25 million, which again led to speculation that the worst was over for the airline. However, this was in itself a small figure compared to the £178 million operating profit it made for the same period in 2007.

All hopes that BA is on the road to recovery also have to consider the fact that, despite the good results for the third quarter, in the nine months to December its pre-tax loss was £342 million, compared to £70 million in 2008.

It is still good news for BA, which is having a hard time at the moment as it desperately tries to avert strike action by the Unite union. This lower loss could help that process. Even so, however, BA also has a pension deficit of nearly £4 billion to deal with, so it is not quite out of the water yet.