In an announcement on Friday, British Airways expressed plans of selling its headquarters building. As the Coronavirus pandemic accelerated a switch to work from home arrangements, the airline said, it was unnecessary for it to hold so much office space.
British Airways that is a subsidiary of International Consolidated Airlines Group (LON: IAG), said on Friday:
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“We’ve re-structured our business to emerge from the crisis and are considering whether we still have the need for such a large headquarters building.”
IAG started the week at a per-share price of £2.14 and closed the regular session on Friday at £2.06 per share. In comparison, the stock had started the year 2021 at an even lower £1.49 per share. Here’s what you need to know about how do people make money on the stock market.
British Airways implemented measures to cut costs in 2020
British Airways said that offloading the building will shore up finances and help cushion the economic blow from the COVID-19 crisis.
The flagship air carrier is the latest in the list of UK companies that have cut office space in recent months, after Lloyds that slashed its office footprint by 20%, and HSBC that is targeting an even broader 40% reduction. Earlier this week, IAG launched a £1 billion bond issue.
The Harmondsworth-company also highlighted that its future policy was also expected to be a mix of work from home and work from the office. British Airways implemented measures last year to minimise costs amidst the ongoing health emergency. This included cutting more than 10 thousand jobs.
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British Airways sold famous works of art last year
British Airways now has a workforce of 30 thousand. The majority of its current employees, many of whom are pilots, engineers, cabin crew, and airport staff, don’t work from the office. The air carrier had famous works of art displayed in its executive lounged. Selling many of them, it sought to further strengthen its cash in 2020.
British Airways announcement comes almost a month after its parent company, IAG, reported £6 billion of net loss for 2020 due to the virus outbreak that continues to weigh on travel and tourism.
IAG performed largely downbeat in the stock market last year with an annual decline of more than 60%. At the time of writing, the flagship airline of the United Kingdom has a market cap of £10.25 billion.