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International Consolidated Airlines Group SA on Friday reported a narrowed loss for 2021 through a rebound in bookings, fostering confidence in the group flying 85% of its pre-virus capacity in 2022.
For the year, the British Airways-parent posted a pretax loss of EUR3.51 billion, narrowed considerably from EUR7.83 billion in 2020.
IAG's operating loss narrowed to EUR2.77 billion from EUR7.45 billion the year before. Pre-exceptional items, the carrier's operating loss narrowed to EUR2.97 billion from EUR4.39 billion, beating consensus expectations of an EUR3.03 billion loss.
This was on revenue which grew 8.3% year-on-year to EUR8.46 billion from EUR7.81 billion, as passenger revenue rose 5.9% on reduced travel restrictions and a rise in passenger capacity by 7.7% year-on-year to 121.96 billion available seat kilometres, and 36% of 2019 levels.
In addition, Cargo revenue rose 28% year-on-year to a record EUR1.67 billion, with additional flights for cargo-only flying being made available in the absence of passenger capacity. Cargo revenue was also 50% above 2019's figure.
Cargo tonne kilometres meanwhile rose 17% annually to 3.97 billion from 3.40 billion.
IAG said the spread of Omicron from late November had a negative short-term effect on its annual operating result, passenger bookings and cancellations, meaning that the group expects a significant operating loss for the first quarter of 2022.
However, the airline anticipates a return to profitability in the second quarter, which should lead to a significantly positive year for operating profit and cash flow.
"Prior to Omicron, long-haul traffic had seen the highest booking activity in October and November at over 80% of 2019 levels. This was driven by the re-opening of the North Atlantic corridor and the strength of long-haul leisure markets and travellers visiting families and friends," said Chief Executive Officer Luis Gallego.
"Demand slowed down for very near-term trips following the emergence of Omicron in late November. However, 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," Gallego added.
Shares in IAG were 0.6% lower at 146.64 pence on Friday morning in London.
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