British Airways-owner IAG to lay bare toll coronavirus took in 2020, and forecasts for its annual results are grim
After the pandemic laid waste to holidays and business travel last spring and summer, winter breaks were supposed to provide a boost to airlines.
But the emergence of new variants and severe second waves scuppered these plans almost before they started.
On Friday next week British Airways-owner IAG will lay bare the toll it took in 2020. The forecasts for its annual results are grim: analysts expect the airlines conglomerate to post a loss of £4.9billion. This compares with profits of £2.6billion in 2019.
IAG owns a stable of airlines including Ireland’s Aer Lingus and Spain’s Iberia – but BA is still its major earner and has been worse hit than many carriers because of its reliance on transatlantic flights.
Beyond the details of last year’s difficulties, the City’s main questions will be around current trading and what happens next.
IAG raised £2.5billion from selling shares last autumn – will it need to turn to investors again or will a £2billion UK state-backed loan for BA and help from other governments for BA’s sister carriers be enough?
Last April IAG said it would cut 12,000 jobs at BA – is this still the plan? Will more people be able to stay or will even more need to go? And how many roles will be axed across the group in total?
These results are less about what happened last year and far more about the future – and chief executive Luis Gallego, who took over in September, will likely have a difficult task ahead in answering those questions.