7th May 2020 09:00
(Alliance News) - International Consolidated Airlines Group SA on Thursday reported a quarterly loss, in line with guidance given last week, and the British Airways-owner said Chief Executive Officer Willie Walsh will stay a little longer.
Walsh will remain at the helm until September 24, not departing at the end of June as initially planned. His departure was announced back in January with boss IAG-owned Iberia Luis Gallego replacing him.
IAG on Thursday also confirmed it endured a difficult fourth quarter, swinging to an operating loss of EUR1.86 billion in the three months to March 31, from a EUR135 million profit a the year prior.
On Tuesday last week, IAG said it took a EUR1.3 billion profit hit due to fuel and foreign currency hedges.
It affirmed on Thursday that its first quarter operating loss before exceptional items was EUR535 million, again a swing from last year's EUR135 million profit.
Revenue fell 15% to EUR4.59 billion in the three months to the end of March from EUR5.30 billion in the first quarter of 2019.
"Passenger capacity has been reduced by 94% from late March with most aircraft grounded and those retained for operating limited passenger, repatriation and cargo-only flights being appropriately-sized and new-generation, where practical," IAG said.
The FTSE 100 airline group said it is planning for a "meaningful" return to service in July, but warned passenger demand may only return to pre-pandemic levels in 2023. It added it will defer the delivery of 68 aircraft.
Elsewhere, numbers showed available seat kilometres fell by 11% year-on-year to 67.5 million
CEO Walsh said: "The operating result up to the end of February was in line with a year ago. However, March's performance was severely affected by government travel restrictions due to the rapid spread of Covid-19 which significantly impacted demand. Most of the loss in the quarter occurred in the last two weeks of March."
The company its second quarter will be even worse than the first.
Last week IAG announced there could be 12,000 redundancies at British Airways as part of a proposed restructuring.
"The proposals remain subject to consultation but it is likely that they will affect most of British Airways' employees and may result in the redundancy of up to 12,000 of them. As previously announced, British Airways has availed itself of the UK's Covid-19 job retention scheme and furloughed 22,626 employees in April," IAG said.
The travel sector has been battered by lockdowns being implemented globally as governments grappled to halt the spread of Covid-19.
IAG shares were 2.0% lower at EUR192.70 each in London on Thursday morning.
By Eric Cunha; [email protected]
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