International Airlines Group, owner of British Airways, has called for a rapid reopening of international borders as it sank to a €1bn first-quarter loss and warned it would fly just a fraction of its normal schedule in coming months.
The group, which also owns Iberia, Aer Lingus and Vueling, on Friday reported an operating loss of €1.1bn for the first three months of the year, when widespread travel restrictions were in place owing to surging cases of Covid-19 across Europe.
The prospects for this summer seem brighter, although carriers are reliant on the UK and other European countries allowing mass travel in time for the peak season.
The airline group said it planned to fly 25 per cent of its normal schedule between April and June, but is ready to add more flights if there is demand.
The UK government is set to outline plans to reopen foreign travel in coming days. IAG, which is particularly reliant on long-haul and lucrative corporate travel, has also been pushing London and Washington to open an air corridor between the US and UK.
“We’re absolutely confident that a safe restart to travel can happen as shown by the scientific data,” said Luis Gallego, IAG’s chief executive. “We’re ready to fly, but government action is needed.”
IAG’s airlines flew just a fifth of their normal flight schedules in the first quarter. Revenue fell 79 per cent to €968m.
The quarterly results follow an annual operating loss after exceptional items last year of €7.4bn, which was the widest since its formation 10 years ago.
Despite the spiralling losses the airline group has accumulated a sizeable pool of cash to see it through the crisis. IAG had €10.5bn in cash and other liquidity at the end of March, €200m more than at the end of last year.
However, like many of its peers the airline has become increasingly indebted, meaning the effects of Covid-19 will hang over its balance sheet for years to come. The group reported €11.6bn in net debt, up from €9.8bn at the end of 2020.