Log in
E-mail
Password
Show password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
News: Latest News
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 
All NewsEconomyCurrencies & ForexEconomic EventsCryptocurrenciesCybersecurityPress Releases

BA-owner IAG more cautious on recovery than competitors

07/30/2021 | 04:16am EDT
FILE PHOTO: A British Airways plane taxis past tail fins of parked aircraft at Heathrow Airport in London

LONDON (Reuters) -British Airways-owner IAG said summer capacity would rise to 45% of pre-pandemic levels, a more cautious bet than rivals as its transatlantic business has yet to fully reopen.

IAG's 45% Q3 capacity plan is a significant jump over the 22% it flew in the March-June quarter, but puts it some way behind Air France-KLM, easyJet and Ryanair, which IAG's CEO blamed on the partial closure of the U.S. market.

"The weight of our network is balanced to the Atlantic," Chief Executive Luis Gallego told reporters on Friday, adding that it was possible that IAG would beat its 45% plan this quarter.

"That's what we think we are going to fly, but we are ready to fly more," he said.

For the October-December quarter, IAG was ready to fly up to 75% of its 2019 capacity, he said.

British Airways, usually IAG's most profitable airline, has been hammered by restrictions in its home market that have been tighter and lasted longer than those in Europe, allowing the group's Spanish airlines Iberia and Vueling to recover faster.

They are set to fly around 70% of their capacity this summer, showing how UK restrictions and last minute rule changes have dragged on BA.

Britain will lift more restrictions on arrivals from the United States on Monday, allowing a partial reopening of the transatlantic, but the United States continues to be closed to UK and European arrivals.

Shares in IAG traded down 3% in early deals. The stock has gained 24% over the last six months.

"Further opening up of the U.S. market during Q3, which may yet happen, would be a significant catalyst for the stock," said Bernstein analyst Daniel Roeska.

Air France-KLM, which compared to BA has benefited from the earlier opening of Europe to U.S. passengers, said on Friday it expected third quarter capacity at 60-70% of 2019 levels.

Short-haul rivals EasyJet and Ryanair are also ahead of IAG, aiming for 60% summer capacity and July passenger numbers at two-thirds of 2019 levels respectively.

Low levels of flying due to ongoing pandemic restrictions meant that for the three months to the end of June, IAG reported an underlying operating loss of 1.045 billion euros ($1.24 billion), in line with a consensus forecast for a 1.036 billion euros loss.

The group declined to give a profit forecast, citing COVID-19 uncertainty. It said it had liquidity of 10.2 billion euros and it continued to preserve cash by reducing its cost base.

Asked if there could be further redundancies after BA last year announced more than 10,000 jobs would go, Gallego said that was not what he expected, but that he would like to see the UK furlough scheme extended to the end of 2021.

($1 = 0.8418 euros)

(Reporting by Sarah Young; editing by Guy Faulconbridge and Barbara Lewis)

By Sarah Young


ę Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
EASYJET PLC 3.78% 654.2 Delayed Quote.-9.79%
INTERNATIONAL CONSOLIDATED AIRLINES GROUP, S.A. 11.16% 166.18 Delayed Quote.-6.45%
Latest news "Economy & Forex"
04:24pU.S. SEC warns investors of risks from certain Chinese business entities
RE
04:23pCanadian dollar, TSX slide ahead of uncertain election outcome
RE
04:23pWall Street ends sharply lower in broad sell-off
RE
04:11pShell nears deal to sell Texas shale assets to ConocoPhillips for $9.5 billion - WSJ
RE
04:09pExclusive-Netflix offers free plan in Kenya to entice new subscribers
RE
04:04pS&p 500 registers biggest daily pct drop since may 12, dow posts biggest daily pct drop since july 19, nasdaq has biggest daily pct drop since may 12
RE
04:01pDemocrats' time crunch tightens after immigration move blocked
RE
04:00pFree netlfix plan in kenya will not have ads
RE
04:00pFree netflix plan in kenya will offer about one-quarter of company's programming
RE
04:00pNetflix to offer free plan in kenya on android mobile devices - company official
RE
Latest news "Economy & Forex"