BA parent expects to return to profit but struggles to ramp up flights to meet demand. British Airways owner IAG (IAG.L) lost as much as 8% on Friday after it revealed a hefty loss in the first quarter of the year thanks to Omicron denting passenger numbers.

The airline, which also owns Aer Lingus and Iberia, posted a pre-tax loss of £916m ($1.13bn) in the first three months, although this had narrowed from £1.2bn the year before.

The owner of British Airways expects to return to profit this quarter as the travel industry recovers from the worst impact of the coronavirus pandemic and airlines rush to scale up operations to meet the demand for flying.

International Airlines Group, the owner of carriers including British Airways, Aer Lingus and Iberia, on Friday welcomed the “strong” return of business travel, which has hit its highest levels since the start of the pandemic. There was “no noticeable impact” from the war in Ukraine on bookings, it said.

The company said it expected to report an operating profit in the second quarter and for the full year, which would put two years and more than €10bn of losses behind it.

“Demand is recovering strongly,” said Luis Gallego, IAG’s chief executive.

The aviation industry has struggled to restart operations and BA has been forced to cancel hundreds of flights and thin out its schedules until June as it faces staff shortages.

Gallego blamed “global” challenges, but said BA’s focus was on “improving operations and customer experience and enhancing operational resilience”.

IAG on Friday slightly slowed its recovery plans because of its operational problems.

It now plans to increase its schedules to 80 per cent of pre-pandemic levels this year, down from the 85 per cent guided in February, including restoring almost all its normal capacity on transatlantic routes this summer.