British Airways warns of deepening travel slump

British Airways warns of deepening travel slump
British Airways has taken the axe to its winter flying schedules after posting a $1.5 billion quarterly loss. (Reuters)
Short Url
Updated 23 October 2020

British Airways warns of deepening travel slump

British Airways warns of deepening travel slump
  • As a second wave of COVID-19 infections spreads across Europe, airlines are facing a bleak winter

LONDON: British Airways owner IAG warned the travel slump from the coronavirus pandemic had deepened, forcing it to axe even more of its winter flying schedule after it reported on Thursday a quarterly loss of €1.3 billion ($1.54 billion).

The loss was far larger than the €920 million forecast by analysts, as passenger numbers plunged and it struggled to even half-fill its planes, illustrating the scale of the challenge faced by IAG’s new boss, Luis Gallego, who took over in September.

As a second wave of COVID-19 infections spreads across Europe, airlines are facing a bleak winter and IAG joins Lufthansa, Ryanair and easyJet in cutting back already anemic schedules.

IAG, which also operates Iberia and Vueling in Spain and Aer Lingus in Ireland, said that for the fourth quarter — which includes the normally busy Christmas period — it would fly no more than 30 percent of the capacity it flew a year earlier, lower than previous guidance of 40 percent.

Shares in the company dropped 3 percent to 97 pence soon after the open. The stock has lost 78 percent in the year-to-date as the pandemic has crushed its business.

With less flying ahead, the group warned it no longer expected to reach breakeven in terms of net cash flow from operations in the fourth quarter, but said that liquidity was strong.

The company has raised €2.74 billion from shareholders via a rights issue and received the funds in early October, raising its total liquidity to €9.3 billion.

Bernstein analyst Daniel Roeska said even with that buffer IAG needed to focus on reducing costs.

“Management will need to significantly lower monthly cash burn to avoid significantly depleting resources by next summer,” he said.

But Goodbody analysts said that total liquidity was positive and IAG would be ready for a recovery in demand next spring.

IAG said it was operating in an environment of “high uncertainty.” It has been calling for COVID-19 tests at airports to replace quarantine requirements and said that governments had been slower than it expected to adopt such measures.

IAG said it would provide more detailed results on Oct. 30. 


Saudi Arabia’s Amkest Group signs deal with US green energy firm

Amr Khashoggi, Chairman of Amkest Group and Scott Poulter, Chief Executive of Pacific Green Technologies
Updated 05 December 2020

Saudi Arabia’s Amkest Group signs deal with US green energy firm

Saudi Arabia’s Amkest Group signs deal with US green energy firm
  • Its expansion into Saudi Arabia through this joint venture is no surprise since the Kingdom is aiming for 30 percent of its energy to come from renewable sources by 2030

RIYADH: US-based Pacific Green Technologies Inc. (PGTK) has signed a joint venture agreement with Amr Khashoggi Trading Co. Ltd. (Amkest Group) to incorporate a company in Saudi Arabia for the sale of Pacific Green environmental technologies.
Amkest Group, founded in 1983, has a history of success in the Kingdom. Its diverse business portfolio includes construction material production and supply, property development and consulting services.
Commenting on the partnership, Scott Poulter, PGTK’s CEO, said: “Saudi Arabia under its Vision 2030 strategic framework, which calls for 9.5 GW of the Kingdom’s energy to be supplied through renewables by 2030, is set to undergo rapid growth.”
Poulter added: “Pacific Green’s technologies, particularly in the solar power, desalination and battery energy storage system sectors, provide the perfect solution to the Kingdom’s growing demand, and we are excited to leverage Amkest Group’s hard-earned relationships to contribute toward the goals of Vision 2030.”
Amr Khashoggi, chairman of Amkest Group, said: “We believe the combination of our experience and knowledge of the Saudi market, coupled with Pacific Green’s portfolio of technologies, provides the foundation for an incredible partnership and the opportunity to offer multiple complementary technologies.”
Pacific Green is focused on addressing the world’s need for cleaner and more sustainable energy. Its expansion into Saudi Arabia through this joint venture is no surprise since the Kingdom is aiming for 30 percent of its energy to come from renewable sources by 2030.
The deal comes on the back of an expectation that Saudi Arabia will attract more than $20 billion in investments in renewables over the next decade. This forecast was made by the CEO of Saudi National Grid in October, according to a report by S&P Global.