BA owner lowers capacity growth forecasts
BA shares affected as IAG drops estimated capacity growth to 3.4 per cent a year for 2020-22
British Airways owner IAG has lowered its forecast for capacity growth for the next three years, affecting its share outlook.
IAG said available seat kilometres, a measure of passenger-carrying capacity, was estimated to grow by 3.4 per cent a year between 2020 and 2022. This compares with a previous forecast of 6 per cent growth a year for the 2019-23 period.
The airline group said the capacity growth cut would lower its forecast for growth in earnings per share to 10 per cent a year from a previous forecast of 12 per cent a year.
IAG shares were later down 3 per cent.
The airline group, which also owns Iberia, Aer Lingus and Vueling, said the forecasts for capacity growth numbers were not adjusted for the impact of BA pilot strikes.
After 48 hours of action in September, no further industrial action is scheduled.
IAG recently announced a €1 billion (£860m, $1.1bn) takeover of Spanish airline Air Europa with the aim to increase its presence on routes to Central and South America and the Caribbean.
It also said it is to introduce carbon offsetting for BA domestic flights from 2020, contributing to Britain’s goal for a net-zero carbon economy by 2050.