Go has been in fierce competition with rival carriers such as easyJet, Ryanair, Debonair and Virgin Express, since it was set up in 1998 as BA's answer to the rise of the small-budget airline.

Despite the losses, chief executive Barbara Cassani said she was pleased with the company's first figures, and said it was set to break even in its third year.

More flights

The rivalry between Go and other cut-price airlines has often been bitter.

Earlier this year, easyJet offered free flights to the first 50 people to correctly guess what Go's losses would be.

EasyJet has also accused BA of attempting to destroy its rivals by offering tickets at unrealistically low prices, such as one-way London to Edinburgh fares at £15.

Go said it had only used half of the £25m launch investment from BA since it set up in May last year, and had strengthened its resources with a strong summer performance.

Ms Cassani said: "We are now carrying 200,000 passengers a month and are well positioned as a leading player in the low-cost market."

Go has increased the number of destinations it flies to from four to 11 since it launched.