BA boss Rod Eddington has downsized since 11 September

Passenger numbers improved on all short haul routes, largely because of intensifying competition between low cost scheduled airlines, BAA said.

Passengers are also less fearful of terrorist attacks on short-haul flights, according to airline analysts.

There were 3.4% more passengers on UK short haul flights, while European scheduled traffic increased by half a percent.

Long haul in doldrums

But there's little sign that people are becoming more willing to fly across the Atlantic since the suicide hijackings that destroyed the Twin Towers in New York.

North Atlantic routes remained stuck below last year's level, but the airport operator saw signs of improvement.

While North Atlantic passenger traffic was 7.7% lower than in February 2001, the figure represented a "substantial recovery" compared to a drop of 31.3% in October, BAA said.

Other long haul traffic also remained in the doldrums, down by 1.4%.

However, there has been "consistent month on month improvement" since last October last year when it plummeted 16.4%, the firm said.

Smaller airports on the up

The strength of low cost airlines was also shown by which airports did best.

While Heathrow's passenger numbers were still below those of a year ago, down 0.1%, regional airports favoured by budget airlines did well.

Airport winners and losers

Edinburgh +19.1% Stansted +16.4% Glasgow +6.4% Aberdeen +2.6% Heathrow -0.1% Gatwick -10.8% Southampton -7.6%

Edinburgh, Glasgow and Stansted, outside London, "experienced strong growth underpinned by the low cost scheduled airlines", said BAA.

The number of passengers using Edinburgh rocketed 19% and Stansted saw a 16.4% increase.

At London's second airport, Gatwick, passengers numbers remained well down on a year ago - 10.8% - but the airport is picking up traffic again because low cost carrier Easyjet has moved in.

"Gatwick's improvement is partly due to new low fare routes coming into service, including Easyjet which, since February, operates to eight destinations from the airport", said BAA.

Plane movements were 2.0% below February last year, despite the modest increase in passengers, while cargo tonnage was almost 10% down, bad news for airlines.

In the City of London, BAA shares stood 5p lower at 664p in early trade on Friday.