Iberia net losses worsen, but confident British Airways merger agreement will be signed soon
Iberia net loss continues to decline; confident British Airways merger agreement will be signed soon
Iberia (-3.7%) slipped after reporting a net loss after tax of EUR273 million for the 12 months ended 31-Dec-2010, compared to a loss of EUR32 million in the previous corresponding period. For 4Q2009, the carrier reported net losses after tax ballooned to EUR91 million, compared to a loss of EUR19 million in the previous corresponding period.
Operating revenues fell by 19.1% year-on-year for the year, to EUR4,409 milllion, principally due to the sharp decline in transport revenues (passenger and cargo), following a generalised decline in demand, particularly within the business segment. Passenger revenue per ASK fell by 14.3%, to EUR5.05 cents.
Operating costs fell by 11.9%, helped by the significant fall in fuel prices. Other expenses were also reduced due to capacity adjustments and cost-saving initiatives put in place under the Contingency Plan. Unit costs fell by 6.3%, to EUR7.84 cents.
Following a capacity (ASK) reduction of 6% year-on-year to adapt to current demand, and traffic (RPKs) fell 6.2%, overall load factor slipped 0.2 ppts, to 79.8%.
Iberia Chairman, Antonio Vazquez, stated he is confident the British Airways will be able to find a solution to its pension deficit issues and a merger between the two carriers will go ahead, with a definite deal to be signed in the “next few weeks”. British Airways (-1.2%) was also down yesterday.
See related report: Airline structural change in Europe: a major turning point – if labour allows it
TUI Travel gains
TUI Travel (+2.2%) was meanwhile one of the few gainers on Thursday, after Carnival Cruises announced plans to lift prices after strong bookings for the 2010 holiday periods, suggesting improving demand for travel. Nine out of 21 broker notes rated TUI’s stocks as ‘Strong Buy’, while three rated it as ‘Buy’, according to What Investment and Digital Look.
Other stories available in today’s Europe Airline Daily include:
- Ryanair’s announces Liverpool-Szczecin services;
- Air Southwest and Eastern Airways sign strategic airline alliance agreement;
- US Airways and Brussels Airlines pursue codeshare agreement;
- airBaltic announces seven routes for Finland.
Europe selected airlines daily share price movements (% change): 25-Feb-2010