British Airways’ owner records £5.6bn loss due to Covid-19
30 October 2020, 08:14
One-off costs included £1.45bn relating to fuel pricing bets and £249m relating to the 10,000 redundancies planned.
British Airways’ parent company IAG has swung to a pre-tax loss of 6.2 billion euros (£5.6 billion) for the nine months to the end of September.
This compared with a 2.3 billion euros (£2.1 billion) pre-tax profit during the same period a year ago.
One-off costs included a 1.6 billion euros (£1.45 billion) charge relating to fuel pricing bets – or hedging – since so few flights were operated, and 275 million euros (£249 million) relating to the 10,000 redundancies planned.
IAG chief executive Luis Gallego said: “These results demonstrate the negative impact of Covid-19 on our business but they’re exacerbated by constantly changing government restrictions.
“This creates uncertainty for customers and makes it harder to plan our business effectively.”
He went on: “We are calling on governments to adopt pre-departure testing using reliable and affordable tests with the option of post-flight testing to release people from quarantine where they are arriving from countries with high infection rates.
“This would open routes, stimulate economies and get people travelling with confidence. When we open routes, there is pent-up demand for travel.”
Mr Gallego said quarantines are “not the solution” and the industry “cannot wait until the vaccine to have people flying”.
Asked about plans by authorities in the UK and US to trial a travel corridor between London and New York which would reduce the quarantine requirement, Mr Gallego said: “We are trying to put pressure to open some corridors. New York for us is a key destination.
“We hope we can have a solution soon.”
IAG expects it will take until at least 2023 for passenger demand to recover to 2019 levels.
The group said it has completed a 2.7 billion euro (£2.4 billion) capital increase which “makes IAG better placed to take advantage of a recovery in air travel demand”.
Cyprus and Lithuania are the latest countries to lose their exemption from the UK’s quarantine requirement.
Travellers arriving in the UK from those destinations after 4am on Sunday must self-isolate for 14 days due to a rise in coronavirus cases.
Earlier this month, Transport Secretary Grant Shapps launched a taskforce to develop methods of reducing the 14-day self-isolation period for people arriving in the UK from non-exempt locations.
