BA owner makes £1.2bn loss in three months
British Airways owner IAG has racked up a massive €1.3 b ill ion(£1.2bn) loss during the past three months while cutting its planned operations for the rest of the year.
The group expects its flight capacity from October to December to be no more than 30 per cent of what it was over the same period last year. This is down from its previous guidance.
IAG said the reduction is due to recent bookings being lower than expected amid “additional measures implemented by many European governments in response to a second wave of Covid-19 infections”.
These include an increase in local lockdowns and the extension of quarantine requirements for travellers visiting a rising number of countries.
Meanwhile, initiatives to reduce quarantine periods and boost customer confidence to book and travel –such as pre-departure testing and air corridors – have “not been adopted by governments as quickly as anticipated”, the group noted.
As a result, it “no longer expects to reach breakeven in terms of net cash flows from operating act ivities” between October and December.
Publishing preliminary financial results for the July-September period, IAG said total revenue fell by 83 per cent year on year to €1.2bn.
The quarterly loss before exceptional items of €1.3bn compares with a€1.4bn profit during the same period in 2019. Flight capacity was down 78.6 percent over the quarter, with passenger demand decreasing by 88 per cent. The average number of seats filled on flights was just 48.9 percent.