Last checked at 
(Correcting IAG pretax and after-tax losses.)
(Alliance News) - International Consolidated Airlines Group on Friday said demand for travel is recovering strongly in line with its previous expectations as the British Airways parent posted a narrowed first-quarter loss.
For the three months ended March 31, IAG reported an after-tax loss of EUR787 million, narrowed from EUR1.07 billion in the first quarter last year, as total revenue more than tripled to EUR3.44 billion from EUR968 million. On a pretax basis, IAG swung to a loss of EUR916 million from a profit of EUR1.22 billion a year before.
IAG said the continued easing of government-imposed travel restrictions, particularly in the UK, resulted in improved travel demand, with no noticeable hit from the war in Ukraine. In addition, IAG - which also owns Iberia and Aer Lingus - said premium leisure continues to be the strongest performing segment and business travel is at its highest level since the start of the pandemic.
As such, IAG said it expects to be profitable from the second quarter onwards and for the full year of 2022.
"As a result of the increasing demand, forward bookings remain encouraging. We expect to achieve 80% of 2019 capacity in the second quarter and 85% in the third quarter. North Atlantic capacity will be close to fully restored in the third quarter," said Chief Executive Officer Luis Gallego.
"The group's operating loss reduced significantly in the first quarter compared to last year, with our losses reflecting normal seasonality, the impact of Omicron and costs associated with ramping up operations," Gallego added.
IAG shares were down 5.8% early Friday, significantly underperforming the wider FTSE 100 index.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.4% at 7,471.10
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Hang Seng: down 3.7% at 20,021.79
Nikkei 225: closed up 0.7% at 27,003.56
S&P/ASX 200: closed down 2.2% at 7,205.60
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DJIA: closed down 1,063.09 points, or 3.1%, at 32,997.97
S&P 500: closed down 3.6% at 4,146.87
Nasdaq Composite: closed down 5.0% at 12,317.69
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EUR: unchanged at USD1.0515 (USD1.0516)
GBP: firm at USD1.2342 (USD1.2331)
USD: up at JPY130.55 (JPY130.30)
Gold: down at USD1,876.00 per ounce (USD1,881.76)
Oil (Brent): up at USD111.67 a barrel (USD110.84)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Friday's key economic events still to come
0930 BST UK S&P Global-CIPS construction PMI
0830 EDT US jobs report for April
1500 EDT US consumer credit
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UK Prime Minister Boris Johnson faced a backlash from local Tory leaders as his party lost major London authorities to Labour and suffered setbacks across England. Keir Starmer's party further strengthened its grip on the capital, taking the totemic Tory authority in Wandsworth, winning Westminster for the first time since its creation in 1964 and clinching victory in Barnet. As dozens of Tory councillors lost their seats against a backdrop of the row about lockdown-busting parties in No 10 and the cost-of-living crisis, local Conservative leaders criticised the prime minister. John Mallinson, leader of Carlisle City Council hit out after Labour took control of the new Cumberland authority which will replace it. He told the BBC: "I think it is not just partygate, there is the integrity issue. "Basically I just don't feel people any longer have the confidence that the prime minister can be relied upon to tell the truth."
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Almost 500 civilians have been evacuated from the devastated city of Mariupol and its besieged Azovstal steel plant in a UN-led rescue operation, the Ukrainian president's office said. The United Nations had said Thursday that a new convoy would evacuate civilians from the "bleak hell" of the factory, which has become the last pocket of resistance in the southern port city. The Russian military had announced a three-day ceasefire at the site starting Thursday but a Ukrainian commander said there was still heavy fighting at the sprawling complex. Hundreds of soldiers and civilians have been holed up for weeks under heavy bombardment, many taking shelter in the plant's Soviet-era underground tunnels. Ten weeks into a war that has killed thousands, destroyed cities and uprooted more than 13 million people, Russia has focused its efforts on Ukraine's east and south, and taking full control of the now-flattened Mariupol would be a major victory for Moscow.
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BROKER RATING CHANGES
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HSBC cuts Centrica to 'reduce' (hold)
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Jefferies cuts Rathbones to 'hold' (buy) - price target 2,100 (1,900) pence
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RBC cuts Rathbones price target to 2,350 (2,420) pence - 'outperform'
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Goldman Sachs starts Petrofac with 'buy' - price target 170 pence
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COMPANIES - FTSE 100
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Holiday Inn-owner InterContinental Hotels Group said it experienced positive trading conditions in the first quarter with travel demand continuing to increase in almost all of its key markets around the globe. For the three months ended March 31, revenue per available room - a key metric in the hotel industry - was up 61% from the first quarter of last year. First quarter average daily rate - which measures the average rental revenue earned for an occupied room per day - was up 27% from a year before. IHG said Americas and EMEAA regions saw sequentially improved trading in February and March after a challenging January. However, in Greater China, trading in March was hurt by the tightening of localised travel restrictions following a spike in Covid-19 cases. In Greater China, first-quarter RevPAR was down 7% from the first quarter of 2021 and down 42% from the same period in 2019. "The high level of demand we have seen for leisure travel continues to drive increased rates and occupancy. We also continue to see a return of business and group travel, further supporting RevPAR improvements in many of our key urban markets," said Chief Executive Officer Keith Barr.
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COMPANIES - FTSE 250
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Technology testing firm Spirent Communications said it has seen an encouraging start to the year with 18% order growth for the three months to March 31. Spirent said it continues to secure many large 5G contract wins as the development of the technology and network deployments remain solid long-term drivers that underpin growth. "As expected, we have continued to see inflationary pressures and a volatile supply chain environment. However, our resilient business model, together with our active mitigation of these pressures, mean that our expectations for the full year remain unchanged," the company said.
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COMPANIES - SMALL CAP
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Martin Sorrell's advertising agency S4 Capital revealed a GBP55.7 million pretax loss in 2021, swung from a profit of GBP3.1 million in 2020, despite revenue nearly doubling to GBP686.6 million from GBP342.7 million, amid big adjusting items. The results had been delayed after auditor PricewaterhouseCoopers was unable to complete its work on time. "In our third full financial year, we almost doubled in size, approximately half through organic growth and approximately half through combinations and generated over USD900 million of revenue in 33 countries," Sorrell said. "Whilst this growth, both organic and through business combinations, is very satisfying, the delay in producing our 2021 results is unacceptable and embarrassing and significant changes in our financial control, risk and governance structure and resources are being implemented and planned, including several significant additions to the central and Content practice financial teams and the audit committee."
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COMPANIES - GLOBAL
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German sportswear heavyweight Adidas reported a drop in its profits in the first quarter, as widespread coronavirus lockdowns hurt business in key market China. The group's net profit from its continuing operations fell to EUR310 million from EUR502 million in the same quarter last year. The setback was accompanied by a 3% drop in sales across the board, the group said in a statement. Adidas estimated that "supply-constraints as a result of last year's lockdowns in Vietnam", where the group has production facilities, had suppressed as much as EUR400 million in revenue in the first quarter. At the same time, "Covid-19-related lockdowns" in China and other Asian markets have held back demand for its wares.
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Friday's shareholder meetings
BlackRock World Mining Trust PLC - AGM
CMO Group PLC - AGM
InterContinental Hotels Group PLC - AGM
Man Group PLC - AGM
Rightmove PLC - AGM
Spirent Communications PLC - AGM
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By Tom Waite; thomaslwaite@alliancenews.com
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