Intl Con Airline Grp
IAG FY 2021 Results
RNS Number : 7855C
International Cons Airlines Group
25 February 2022
Full year results announcement
International Consolidated Airlines Group (IAG) today (February 25, 2022) presented its unaudited Group consolidated results for the year to December 31, 2021.
- Passenger capacity in quarter 4 was 58% of 2019 capacity, up from 43% in quarter 3 and for the full year was 36% of 2019 capacity.
- The easing of government-imposed travel restrictions as the year progressed resulted in improving travel demand, in particular following the opening of the US border to foreign travellers on November 8.
- The impact of Omicron, which became apparent on November 25, had a negative short-term impact on the operating result, passenger bookings and cancellations.
- Significantly improved operating cash flow of €1.0bn in the second half of 2021, driven by positive EBITDA in quarter 4, strong forward bookings and favourable working capital.
- Capex in 2021 was €0.7 billion, significantly lower than €1.3 billion previously guided and €1.7 billion expected at the start of the year, due to the delay of Airbus and Boeing aircraft.
- Cash of €7,943 million at December 31, 2021, up €2,026 million on December 31, 2020. Committed and undrawn general and aircraft facilities were €4,043 million, bringing total liquidity to €11,986 million, compared to €8,059 million at December 31, 2020.
- Proceeds from borrowings of €4.8 billion in 2021, including: £2.0 billion UK Export Finance (UKEF) guaranteed 5-year loan for British Airways; €1.2 billion unsecured bond issuance by IAG; €825 million convertible bond issuance by IAG; $785 million sustainability-linked EETC for British Airways, of which $150 million was drawn in 2021; €75 million loan from the Ireland Strategic Investment Fund (ISIF) by Aer Lingus and other aircraft financing.
- In addition, the Group agreed new general facilities, which have not been drawn during 2021, including a $1.755 billion 3-year revolving credit facility available to Aer Lingus, British Airways and Iberia and a £1.0 billion UKEF guaranteed credit facility for British Airways.
- Current passenger capacity plans for 2022 are for around 65% of 2019 capacity in quarter 1 and for around 85% of 2019 capacity for the full year. Omicron has affected bookings in January and February 2022 but has had a minimal impact on bookings for Easter and summer 2022.
- Capex in 2022 is expected to be €3.9 billion, reflecting the need to re-build capacity towards pre-pandemic levels, the delay of aircraft deliveries from 2021 and certain pre-delivery payments deferred from previous years. 25 new aircraft are expected to be in delivered in 2022.
IAG results for the period:
- Statutory operating loss for the fourth quarter €278 million (2020 restated1: operating loss €1,476 million), and operating loss before exceptional items €305 million (2020 restated1: operating loss before exceptional items €1,170 million).
- Statutory operating loss for the year to December 31, 2021 €2,765 million (2020 restated1: operating loss €7,451 million), and operating loss before exceptional items €2,970 million (2020 restated1: operating loss before exceptional items €4,390 million).
- Loss after tax and exceptional items for the year to December 31, 2021 €2,933 million (2020 restated1: loss after tax €6,935 million) and loss after tax before exceptional items €3,038 million (2020 restated1: loss €4,337 million).
Performance summary:
|
|
Year to December 31 |
|||
|
Statutory results (€ million) |
2021 |
|
2020 restated1 |
Higher / (lower) |
|
Passenger revenue |
5,835 |
|
5,512 |
5.9 % |
|
Total revenue |
8,455 |
|
7,806 |
8.3 % |
|
Operating loss |
(2,765) |
|
(7,451) |
(62.9)% |
|
Loss after tax |
(2,933) |
|
(6,935) |
(57.7)% |
|
Basic loss per share (€ cents)2 |
(59.1) |
|
(196.6) |
(69.9)% |
|
Cash and interest-bearing deposits |
7,943 |
|
5,917 |
34.2 % |
|
Borrowings |
19,610 |
|
15,679 |
25.1 % |
|
|
|
|
|
|
|
Alternative performance measures (€ million) |
2021 |
|
2020 restated1 |
Higher / (lower) |
|
Passenger revenue before exceptional items |
5,830 |
|
5,574 |
4.6 % |
|
Total revenue before exceptional items |
8,450 |
|
7,868 |
7.4 % |
|
Operating loss before exceptional items |
(2,970) |
|
(4,390) |
(32.3)% |
|
Loss after tax before exceptional items |
(3,038) |
|
(4,337) |
(30.0)% |
|
Adjusted loss per share (€ cents)2 |
(61.2) |
|
(122.9) |
(50.2)% |
|
Net debt |
11,667 |
|
9,762 |
19.5 % |
|
Available seat kilometres (ASK million) |
121,965 |
|
113,195 |
7.7 % |
|
Passenger revenue per ASK (€ cents) |
4.78 |
|
4.92 |
(2.9)% |
|
Non-fuel costs per ASK (€ cents) |
7.78 |
|
9.03 |
(13.8)% |
Cash comprises cash, cash equivalents and interest-bearing deposits.
1 The 2020 results have been restated for the treatment of administration costs associated with the Group's defined benefit pension schemes, which increased the loss after tax for the year to December 31, 2020 by €12 million.
2 The loss per share information for the year to December 31, 2020, has been restated to reflect the impact of note 1 above.
Luis Gallego, IAG's Chief Executive Officer, said:
“We are confident that a strong recovery is underway. Our teams across the Group are taking every opportunity to develop our business while capitalising on the surge in bookings when travel restrictions are lifted. Our people's extraordinary work and dedication has been key to weather this crisis. We are also monitoring recent geopolitical events closely to manage any potential impact.
“All our airlines continued to show improvements in the fourth quarter, optimising their performance and further improving their operating results. Our diversified business model enabled us to make the most of the recovery as individual markets were affected at different times and in different ways.
“Iberia made €82 million operating profit in the quarter as it seized opportunities to strengthen its position on routes to Latin America and the Spanish domestic market.
“IAG Loyalty continued to be profitable and cash generative, as it has been throughout the pandemic, which shows the benefits of our unique platform.
“Premium leisure has performed strongly at both British Airways and Iberia while business travel has started to recover especially on the transatlantic routes.
“Prior to Omicron, longhaul traffic had seen the highest booking activity in October and November at over 80 per cent of 2019 levels. This was driven by the re-opening of the North Atlantic corridor and the strength of longhaul leisure markets and travellers visiting families and friends.
“Demand slowed down for very near-term trips following the emergence of Omicron in late November. However, bookings have remained strong for Easter and summer 2022 having picked up in the New Year. We expect a robust summer with IAG returning to around 85% of its 2019 capacity for the full year.
“As we ramp up operations our customers remain at the heart of everything we do. This means investment in passenger experience and operational resilience to provide the best service.
“We know that after the worst crisis in aviation's history we must do things differently. Our model enables us to capture revenue and cost synergies while maximising efficiencies which means we are set up to return to profitability in 2022.
“We're pleased that our work tackling climate change continues to be recognised as industry-leading. For the second year running, IAG was the only European airline group to receive a Leadership grade (A-) from the Carbon Disclosure Project (CDP). This puts us in the top six per cent among nearly 12,000 global companies. We also received the highest score of any airline from the Transition Pathway Initiative (TPI) which assesses companies' readiness to transition to a low-carbon economy.”