Liquidity & optimism with Iberia compensate for the shortcomings of BA16 Apr 2022 13:40
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https://www.finanzas.com/ibex-35/iag-la-liquidez-y-el-optimismo-con-iberia-compensan-las-carencias-de-british-airways.html
The current image given by the emblem of IAG , British Airways , is not experiencing its best moment and the airline holding company is clinging to the liquidity and prospects of its second brand, Iberia, to solve the situation.
The British airline's contribution to the group's accounts is essential for IAG to return to profitability, but delays, cancellations and computer failures are making it difficult for it to put enough planes in the sky for current demand.
British Airways is struggling to cope with pent-up demand and according to aviation data provider Cirium , the company has canceled 1,244 flights this year. That is, 1 out of every 20 of those scheduled.
The published report reflects that the shortcomings are greater for its competitors and the group's main shareholder, Qatar Airways , is pressuring the parent company to recover the good brand image of the flagship, according to the Financial Times .
The wake-up call comes after an investment of billions of dollars to improve British Airways' business flight offer, from which the airline achieves large margins for the group and which are now stressed by operational failures.
The problem could have crudely dragged IAG shares, which are trading practically flat on the IBEX 35 so far this year, to 1.7 euros, although they have lost nearly 30 percent in the last 12 months.
Given the situation, IAG clings to its ability to generate liquidity at the group level despite the continuous burning of cash due to the restrictions derived from the coronavirus
The latest accounts offered by IAG, those of the accumulated 2021, reflect that the cash increased by 2,026 million euros compared to a year ago, to 7,943 million euros, and the general and committed aircraft financing lines and not used rose by 4,043 million , to a total liquidity of 11,986 million. Despite this, the debt grew 19.5 percent, to 11,667 million.
Iberia is positioning itself as another bastion to face the uncertainties of IAG and it was already demonstrated in the accounts. While British Airways revenue fell 6 percent, Iberia grew 23 percent.
The same happened with the low-cost companies associated with both brands with a drop in turnover of 20 percent for Air Lingus and a rise of 77 percent for Vueling .
In addition, Iberia has recovered 90 percent of its capacity for this Easter week compared to the same period in 2019, before the pandemic, and maintains the perspective of 85 percent for the summer .
Thanks to the known data for Easter, the IAG titles move this week in their best promotion records since mid-February with an accumulated rise that is close to 10 percent.
This week, the CEO of Iberia, Javier Sánchez-Prieto , commented at an event organized by IATA , the international airline employer, that they plan to reach 100 perc