British Airways parent company International Consolidated Airlines Group is expected to report final earnings results tomorrow. The results come as the share prices plunged to a 4-month low after losing 20% of its value this week and 10% of its value today.
News that the Court of Appeal has found plans for a third runway at Heathrow unlawful sent the share price sharply lower on Thursday.
The news put more pressure on the airline, which is already on the back-foot owing to the impact of coronavirus and the anticipation of lower demand globally.
British Airways joined other airlines in suspending flights to and from mainland China back in January. Today BA has cancelled some flights to and from Milan, Italy and Seoul, South Korea as a result of reduced demand.
Investors will be mostly focused on the impact of coronavirus in IAG’s outlook. It will be very difficult for the airline to quantify the expected impact, but we are certain that it will attempt to. Disruption in the first quarter is expected to be significant and the effects could easily spill over into the second quarter and beyond.
So far, Air France KLM has said it expects to lose €150 - €200 million should flights to Asia be suspended through April. A similar number from ICAG could be in the pipeline.
Chart Thoughts
International Consolidated Airlines has been on a virtually uninterrupted bullish run since hitting a low of 410p at the end of the summer. Since then the share price has rallied some 65% to a high of 684p in mid-January.
The share price has plunged 20% this week, breaking through the 50-, 100- and then today, the 200-day SMA on the daily tax, negating the bullish trend.
