International Airlines Group has reported a loss of €7.4 billion for financial 2020 as the Covid-19 pandemic wrought havoc in the aviation sector.

The losses include charges for exceptional items relating to fuel and currency hedges, early fleet retirement and restructuring costs.

The figure is in comparison to a profit of €2.6 billion in 2019.

The group – which includes Iberia, British Airways, Aer Lingus and others – saw revenue fall 69 per cent to €7.8 billion for the year to December.

Luis Gallego, IAG chief executive, said: “Our results reflect the serious impact that Covid-19 has had on our business.

“We have taken effective action to preserve cash, boost liquidity and reduce our cost base.”

Despite this crisis, IAG said its liquidity remained strong.

At the end of December, the group had €10.3 billion on hand, including a successful €2.7 billion capital increase and £2 billion loan commitment from UKEF.

This is higher than at the start of the pandemic, the group said.

“In 2020, our capacity decreased by 67 per cent while our non-fuel costs went down 37 per cent thanks to the extraordinary effort across our business,” said Gallego.

“The group continues to reduce its cost base and increase the proportion of variable costs to better match market demand.”

In the first quarter of 2021, IAG hopes to fly around one fifth of the capacity levels seen in 2019 – but even this remains “uncertain and subject to review”.

With continuing uncertainty around Covid-19, IAG said it was currently unable to offer guidance to its performance in 2021.

Also today, IAG said Lynne Embleton had been appointed chief executive of Aer Lingus.