British Airways has reported its biggest annual loss due to lower passenger numbers, higher costs and the impact of strike action.
The flag carrier lost £531m ($766m) in the 12 months to March - BA's biggest loss since it was privatised in 1987.
That adds to the £401m it lost in the 2008-9 financial year, but as it was less than expected, BA shares rose.
The results come as BA faces 15 more days of strike action by cabin crew, due to begin on Monday.
Revenues at the airline were down £1bn on last year, BA said, though it managed to cut costs by nearly £990m - a £600m saving coming from lower fuel costs over the year.
BA's chief executive Willie Walsh said that despite the huge losses, the company's efforts to cut costs were a cause for optimism.
But he said the agreement of staff to "permanent change" was essential if the airline was to recover.
"Returning the business to profitability requires permanent change across the company and it's disappointing that our cabin crew union fails to recognise that," Mr Walsh said.
"Structural change has been achieved in many parts of the business and our engineers and pilots have voted for permanent change."
It is estimated that strikes by cabin crew in March cost BA £43m. Further strikes due to begin next week are likely to hit the airline's finances even further.
The disruption caused by volcanic ash from Iceland is also likely to have added to BA's losses, though this is not counted in these latest results.
Douglas McNeill, transport analyst at Charles Stanley, said the ash-related disruption could cost BA an extra £100m.
But despite the problems caused by ash and strikes, the underlying problems of high costs and a fall in passenger numbers were still the major concern, he said.
As well as fewer passengers, those business passengers who were flying were downgrading to cheaper seats.
However, a cause for optimism was that there had been "something of an uptick in demand" from business travel in recent months, he added, and a loss below £600m would be regarded as good news by investors.
BA shares rose in early trading, before falling back.
BA also has significant cash reserves that mean it can continue operating for some time despite losses.
The airline said it currently had £1.7bn in the bank.
Speaking to the BBC, Mr Walsh said BA would be "doing everything we can" to reach an agreement with Unite - the union representing striking cabin crew - in order to prevent strikes from going ahead from Monday.
He added that he had spoken to Unite's joint general secretary Tony Woodley and still hoped to come to an agreement.
Mr Walsh said that he believed BA and Unite would be able to come to an agreement, but blamed Bassa - the branch of Unite representing cabin crew - for preventing that from happening.
But he said the airline was ready to operate "significant services" if the industrial action went ahead.