IAG profit plunges 83% in third quarter as travel restrictions bite

Aer Lingus parent company IAG said revenue plunged 83 per cent to €1.2 billion in the third quarter amid ongoing global travel restrictions.

The airline group reported an operating loss before exceptional items of €1.3 billion, swinging from a profit of €1.4 billion a year earlier.

Passenger capacity fell by 78.6 per cent in the quarter, while passenger trafficwas down by 88 per cent. Load factor, a measure of how full flights are, declined by 38.8 points to 48.9 per cent.

In a statement, IAG said flight capacity between October and December will be “no more than 30 per cent” of what it was during the same period in 2019.

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As a result, the group “no longer expects to reach breakeven in terms of net cash flows from operating activities” over that quarter.

“Recent overall bookings have not developed as previously expected due to additional measures implemented by many European governments in response to a second wave of Covid-19 infections, including an increase in local lockdowns and extension of quarantine requirements to travellers from an increasing number of countries,” it said.

“At the same time, initiatives designed to replace quarantine periods and increase customer confidence to book and travel, such as pre-departure testing and air corridor arrangements, have not been adopted by governments as quickly as anticipated.” – Additional reporting: PA