The past three months has been somewhat of a trying period for British Airways having faced a number of impediments to the way the business is run.

The Icelandic volcanic ash cloud, delay over regulatory approval for its merger with Iberia, industrial action, and concerns over its final pension scheme have all taken their toll on the company.

The firm announced pre-tax losses of £164 million for the three months to 30 June - a £16 million increase on the prior-year period - and a drop in revenue.

However, the airliner saw share price rise in early morning trading following the announcement of its interim results.

Nick Raynor, investment adviser at The Share Centre, said the results had been better than forecast.

He said, ‘Although passenger revenue fell 3.4 percent, BA pointed out that without the disruptions it would have increased 11 per cent year on year.

‘Positive further news is that revenue made per passenger per mile increased 12.7 per cent as costs reduced.’

Raynor added: ‘Investors should be aware that staff action will continue to prove challenging.

‘Last week, Unite rejected BA's latest offer, raising the prospect of further industrial action.  It is important to note that the strike action, whilst impacting the bottom line, is also damaging the reputation of the airline which is not good for a company of BA's standing.’

The analyst said investors should take heart from the joint venture with American Airlines and its proposed merger with Spanish airline Iberia.

He said, ‘If BA can resolve its problems it will be heading in the right direction, and may become an attractive prospect but for now we recommend holding the shares.