The parent company of British Airways said a “strong recovery is underway” and it expects its operating result to be profitable from the second quarter of 2022 – as long as there are no further setbacks.
IAG, which also includes Iberia, Vueling and Aer Lingus, reported an operating loss of €2.8 billion in 2021, compared with a loss of €7.45 billion in 2020, as passenger revenue rose by 5.9% to €5.8 billion year-on-year.
It said the easing of government-imposed travel restrictions boosted demand, especially following the opening of the US border on November 8.
Omicron had a negative short-term impact on the operating result, passenger bookings and cancellations at the end of the year.
The surge of the variant also affected bookings in January and February 2022 but has had a minimal impact on bookings for Easter and summer 2022.
Current passenger capacity plans for 2022 are for about 65% of 2019 capacity in the first quarter and about 85% of 2019 capacity for the full year.
Luis Gallego, IAG chief executive, said: “We are confident that a strong recovery is underway. Our teams across the group are taking every opportunity to develop our business while capitalising on the surge in bookings when travel restrictions are lifted.
“All our airlines continued to show improvements in the fourth quarter, optimising their performance and further improving their operating results.
“Premium leisure has performed strongly at both British Airways and Iberia while business travel has started to recover especially on the transatlantic routes.
“Bookings have remained strong for Easter and summer 2022, having picked up in the New Year.
“We expect a robust summer with IAG returning to around 85% of its 2019 capacity for the full year.”
A “significant” quarterly operating loss is expected for the first quarter, because of normal seasonality, the impact of Omicron on near-term bookings and the effect on operating costs of re-building capacity.
IAG expects its operating result to be profitable from the second quarter but it added: “This assumes no further setbacks related to Covid-19 and government-imposed travel restrictions or material impact from recent geopolitical developments.”
Picture: Shutterstock