International Airlines Group 2016 Annual Report

232 Pages·2017·7.25 MB·English

INTERNATIONAL
AIRLINES
GROUP
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Connecting
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and countries
ANNUAL REPORT AND ACCOUNTS 2021
Contents
Management Report
Strategic Report Corporate governance
IAG is required to prepare a Management
1 Our purpose 124 Chairman’s introduction to corporate Report in accordance with Article 262 of
governance the Spanish Companies Act and Article 49
2 Connecting people
of the Spanish Commercial Code. Pursuant
126 Board of Directors
4 Connecting businesses to this legislation, this Management Report
128 Corporate governance must contain a fair review of the progress
6 Connecting countries
of the business and the performance of the
144 Report of the Nominations
8 Chairman’s letter Group, together with a description of the
Committee
principal risks and uncertainties that it
10 Chief Executive Officer’s review
148 Report of the Safety, Environment faces. In the preparation of this report, IAG
14 Management Committee and Corporate Responsibility has taken into consideration the guide
16 Business model Committee published in 2013 by the Spanish National
Securities Market Commission (CNMV)
152 Report of the Audit and Compliance
18 Our strategic priorities which establishes a number of
Committee
22 Key performance indicators recommendations for the preparation of
162 Report of the Remuneration management reports of listed companies.
24 Stakeholders engagement Committee
The Management Report is composed of
34 Financial overview the following sections:
35 Financial review Financial Statements
10 Business model
48 British Airways 190 Consolidated income statement
18 Our strategic priorities
50 Iberia 191 Consolidated statement
22 Key performance indicators
of other comprehensive income
52 Vueling
34 Financial overview
54 Aer Lingus 192 Consolidated balance sheet
35 Financial review
56 IAG Cargo 193 Consolidated cash flow statement
63 Sustainability
58 IAG Loyalty 194 Consolidated statement
of changes in equity 100 Risk management and principal risk
60 LEVEL factors
196 Notes to the consolidated
61 IAG GBS financial statements 122 Regulatory environment
62 IAG Tech 263 Alternative performance measures The Annual Corporate Governance Report
is part of this Management Report but has
63 Sustainability 269 Group investments
been presented separately.
100 Risk management and
This report has been filed with the CNMV,
principal risk factors Statement of Directors’ Responsibilities
together with the required statistical
122 Regulatory environment Independent Auditors’ Report annex, in accordance with the CNMV
Circular 2/2018, dated June 12. The Annual
Corporate Governance Report and the
Additional Information
statistical annex are also available on the
284 Glossary Company’s website (www.iairgroup.com).
286 Fleet table The Non-Financial Information Statement
in response to the requirements of Law
287 Operating and financial statistics
11/2018, of December 28 (amending the
IBC Shareholder information Commercial Code, the revised Capital
Companies Law approved by Legislative
Royal Decree 1/2010, of July 2, 2010 and
Audit Law 22/2015, of July 20, 2015), is
part of this Management Report and is
available on the Company’s website
(www.iairgroup.com).
Our role in the
world is to connect
people, businesses
and countries.
We believe in the power We enable this and create value
through a unique model that
of aviation as a social
enables our airlines to perform
good. Being face-to- in the long-term interests of our
customers, people, shareholders
face matters deeply: and society – knowing that success
in each reinforces the others.
for the moments that
Join us as we delve into what
matter in work and life,
connecting people, businesses
for people with family in and countries means to IAG.
other countries, for the
chance to experience
new cultures and
landscapes, and to
transport vital cargo.
INTERNATIONAL AIRLINES GROUP | Annual Report and Accounts 2021 1
Strategic Report
OUR PURPOSE
Connecting
Connecting people goes beyond
building strong, trusted relationships
between our employees, customers
and suppliers.
It means bringing our customers
together through travel – reuniting
families and friends, or bringing work
colleagues and students together.
But often, there doesn’t have to
be a reason beyond giving our
customers the chance to experience
new cultures and landscapes.
Reconnecting families and
friends across the Atlantic
We were so proud to reunite
families and friends following the
lifting of the US travel restrictions on
November 8, 2021. British Airways
operated the first transatlantic flight
powered by 35 per cent Sustainable
Aviation Fuel. There were emotional
scenes in New York as families reunited,
with some meeting new family members
for the first time after being separated
for more than 18 months.
Flying to places that needed us most
Throughout the pandemic we operated
around 167 repatriation flights from 33 cities
across 21 countries to bring our customers
home. Each time travel restrictions were
eased, we laid on additional flights to more
destinations so we could fly passengers where
they needed to be.
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Supporting humanitarian missions
Working with the UK Government and
UNICEF Spain, IAG Cargo flew 25 tonnes of
aid to help the recovery efforts in Haiti
following the earthquake that struck the
country in August 2021.
Transporting aid to those in need:
millions of doses of vaccines carried
during the pandemic
We have continued to support countries’
efforts to combat the pandemic, helping
out wherever we could. Having carried
20,000 tonnes of PPE and humanitarian aid
in 2020, in 2021 we flew millions of doses
of COVID-19 vaccines — delivering to
almost every corner of the world on a Helping to rescue four-legged
regular basis. In May 2021, when India family members
continued to battle rising COVID-19 cases On routes such as Larnaca and Athens to
with dwindling oxygen supplies, IAG Cargo London and Dublin to Toronto, alongside
and British Airways joined forces to fund several global organisations, we transported
two special charters delivering 45 tonnes hundreds of rescue dogs to their forever
of aid from different charities. homes, giving them the chance of a new life
with a new family.
people
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Strategic Report
OUR PURPOSE
Connecting
Connecting businesses allows companies
to thrive no matter where they are based.
It means giving people the chance to
do business when only a face-to-face
meeting will do, transporting goods
from one place to another so we can all
Global network that enables
benefit from international trade. We are businesses to thrive
working with our suppliers to develop The pandemic has shown the importance of
meeting people in person. We’ve played an
the new technologies that will enable
important role in reconnecting businesses
us to reach net zero by 2050, together. through facilitating face-to-face meetings,
flying goods around the world and
continuing to keep vital air links open
across our extensive global network. We’ve
also made it as simple as possible for our
customers to fly with us, through driving
changes in technology including digital
apps to verify the necessary health and
travel documents.
Supporting Spanish economic recovery
Supporting the economic recovery in the
countries in which we operate remains a key
priority for us. Iberia gave a new boost to its
air shuttle service between Madrid and
Barcelona, the most important route for
corporate traffic in Spain. Iberia is operating
around 68 weekly frequencies on this route,
which means up to 11 flights each way from
Monday to Thursday, the busiest days. Vueling
has also been supporting the recovery of
Spanish tourism by increasing its domestic
capacity by up to 114 per cent of 2019 levels in
the year. The airline operated more than 310
routes, 42 of which were added to its network
to support Spanish connections with countries
such as Denmark or Sweden.
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Embracing start-ups and innovation
Through IAG’s core innovation platform
Hangar 51, our Group has supported 60
start-ups and invested in more than 10 tech
players. Many of these are helping to make
aviation greener.
Reconnecting businesses on
both sides of the Atlantic
With more than 800 US companies in Ireland,
employing 180,000 people, and over 650 Irish
companies with a base in the US, we’re
reconnecting businesses on both sides of the
Atlantic. Aer Lingus’ new Manchester base,
which opened in October, offers a daily
service to New York operated by its new
Airbus A321neo LR aircraft, in addition to
connections to Orlando and Barbados.
e-Connecting businesses
Now, more brands are connected with our
eStores and reward apps enabling more
members to collect through everyday
spending. In 2021, IAG Loyalty launched new
partnerships with Nectar, CaixaBank, bp and
Barclays and renewed its Amex and Endesa
agreements.
businesses
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Strategic Report
OUR PURPOSE
Connecting
Connecting countries means having a
wide range of routes and partnerships
to connect all corners of the world.
Supporting Paralympic athletes
As an international airline group with
Supporting Paralympic athletes on their
leading airlines in Spain, the UK and flights from the UK, Spain and Ireland to
and from Tokyo was a real honour. Our
Ireland, our combined network and
people worked tirelessly to ensure the
scale allows us to connect destinations teams and all their equipment travelled
through a wide range of airline models – safely. Everyone at our airlines couldn’t
be prouder of the athletes’ great
from full service, to value, to low-cost.
achievements at the Tokyo 2020
Paralympic games.
75 years connecting Europe
and Latin America
Iberia’s commitment to Latin America
has been key in supporting trade and
connectivity across the South Atlantic.
In 2021, the airline celebrated the 75th
anniversary of its flights between Madrid and
Buenos Aires. It became the first weekly air
bridge connecting Europe and Latin America,
making Madrid the gateway for travellers
in both directions.
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Our commitment to endangered species
Our global network has allowed us to
partner with animal welfare charities to
save and relocate endangered species.
IAG Cargo worked with SEA LIFE and flew
an injured Olive Ridley sea turtle to her
new forever home in Scotland after she
sustained life-changing injuries. She was
entangled in ghost netting with a plastic
bag around her neck which resulted in her
losing a flipper. This initiative was aimed at
raising awareness of the impact of plastic
pollution.
Boosting European connectivity
We have taken opportunities to expand
our services and increase connectivity
throughout our European network.
Vueling has introduced 32 new European
destinations at Paris-Orly, becoming the
second-largest operator at the airport.
The airline was previously operating 22 routes,
mainly to Spain and Italy. Now it offers 54
routes that connect France
with more than 13 countries.
countries
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Strategic Report
CHAIRMAN’S LETTER
Connecting people,
creating sustainable value
It is now more than two years since the
beginning of the COVID-19 pandemic.
These two years have seen our lives
change immeasurably. Around the world,
people have been forced to respond to the
changing environment and find new ways
to do things in all aspects of their lives. We
have all had to adapt to different ways of
working, different ways of maintaining
family life and different ways of spending
our leisure time. All of these have impacted
IAG as an international airline group.
It has been the most challenging time in
our history, particularly for our people. I am
proud of the resilience and creativity that
they have shown. Despite the difficulties
we have faced, it is thanks to their work
that we can look to the future with
confidence. IAG’s strength comes from its
people, and I would like to thank them all
for the contribution they have made during
this time.
My thanks also go to our shareholders.
Their continued support has provided
Javier Ferrán IAG with a strong foundation on which
Chairman to rebuild the business and reshape it for
the future.
One thing that the pandemic has not
changed is IAG’s purpose – to connect
people, businesses and countries around
the world. IAG was created as a unique
platform that enables us to fulfil that
purpose. Our strategy is to use that
“One thing that the pandemic has
platform to deploy our strengths so that
we can recover better and stronger
not changed is IAG’s purpose. Our
than before.
business model is designed in a way We know that despite the difficulties faced
by everyone over the past two years, the
that enables our airlines to perform desire to travel and connect in person is as
strong as ever. Being unable to see friends,
in the long-term interests of our family or business contacts face-to-face
has reminded us all how important those
customers, people, shareholders bonds are. We saw that as restrictions
were lifted throughout the course of 2021
and society.” and the pent-up demand was released,
particularly once the long-closed North
Atlantic travel corridor was re-opened.
One could not fail to be moved by the
images and stories of families reunited
after so long apart, some meeting new
family members for the first time. It was a
reminder that what we do matters.
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