October 2, 2022
IAG Reports Q1 Losses amid Staffing Woes

IAG Reports Q1 Losses amid Staffing Woes

DALLAS – International Airlines Group (IAG) reported its shares fell 12.7% in Q1. The group made strong progress in other key categories.

A notable feature of the report was that IAG’s passenger capacity in Q1 2022 increased to 65% of what it was in Q1 2019 prior to the COVID-19 pandemic.

Furthermore, the airline group’s revenues increased to €3.435bn from €968bn the previous year, indicating a major gain. Still, the passenger figures may have disappointed investors, who remained unfazed by the positive data.

IAG’s loss after tax was also reduced from €1.074bn to €787m, a 26.7% improvement. As a result, the group’s performance improved significantly over the previous year.

G-ZBKM, British Airways Boeing 787-9 Dreamliner. Photo: Michael Rodeback/Airways

Causes for the Losses

In April 2022, IAG airline British Airways (BA) canceled hundreds of flights due to chaos caused at airports as a result of a surge in the holiday demand, staff shortage, and over 200,000 unfilled roles in this sector. These factors could have an impact on the group’s performance in Q2 and the remainder of the year.

Another important risk that the airline group faces is that it will have to pay more for jet fuel because its hedging percentage is substantially lower than that of its peers.

Nonetheless, IAG offered a good operational prognosis, predicting that passenger numbers will be 80% of 2019 capacity, rising to 85% in Q3. Furthermore, the group says it intends to restore the majority of its North Atlantic passenger capacity by Q3.

Investors hardly responded to IAG’s estimate of a return to profitability by the end of Q2, a significant milestone for the airline given that its last profitable quarter was before the coronavirus outbreak. It seems that for them, IAG is not out of the woods just yet.

Featured image: British Airways Airbus A380 Head-on view. Photo: Roland Rimoczi/Airways

Chief Online Editor
Chief Online Editor at Airways Magazine, AVSEC interpreter and visual artist; grammar geek, an avid fan of aviation, motorcycles, sci-fi literature, and film.

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