IAG kept most of its aircraft parked during the coronavirus outbreak due to travel restictions, leading to massive losses

London (AFP) - Airline conglomerate IAG, the owner of British Airways, on Friday posted a first-half net loss of 3.8 billion euros ($4.5 billion) due to the “devastating” impact of coronavirus.

The group, which had posted a year-earlier net profit of 806 million euros, also unveiled plans for a capital increase of up to 2.75 billion euros in a results statement, as it seeks to navigate fallout from the deadly COVID-19 crisis.

“The results … were significantly impacted by the outbreak of COVID-19, which has had a devastating impact on the global airline and travel sectors, particularly from late February 2020 onwards,” the company said.

IAG, which also owns Iberia and Vueling, swung to a pre-tax loss of 4.2 billion euros, which contrasted with profit of 1.0 billion euros last time around.

Revenues tanked 56 percent to 5.3 billion euros in the reporting period.

“All IAG airlines made substantial losses. As a result of government travel restrictions, quarter two passenger traffic fell by 98.4 percent on a capacity reduction in the quarter of 95.3 percent,” said Chief Executive Willie Walsh in the earnings release.

“We have seen evidence that demand recovers when government restrictions are lifted,” he said, adding that the group’s airlines had taken measures to additional reassurance to customers about health and safety.

However, Walsh said that “we continue to expect that it will take until at least 2023 for passenger demand to recover to 2019 levels.”