Business

Spanish airline Iberia trims its losses

Iberia plane
Image caption Iberia is in the process of merging with British Airways

Spanish airline Iberia, which is merging with British Airways (BA), has reduced its quarterly losses by 44% after a rise in its passenger revenues.

Also helped by cost-cutting work, its net loss for the January to March period was 52m euros ($65m; £45m).

Iberia's revenues per passenger rose by 3.7% from a year earlier and it trimmed its workforce by 5.2%.

BA and Iberia signed a deal to merge last month, expecting it to be completed by the end of this year.

They hope that the merger will save the two airlines a combined 400m euros a year.

The new company will be called International Airlines Group, but the BA and Iberia brands will continue to operate as normal.

BA shareholders will own 55% of the business, which will have its headquarters in London.

The world's airlines lost a collective $9.4bn (£6.5bn) last year, as customers reduced air travel during the recession, according to the International Air Transport Association (IATA).

IATA expects this loss to narrow to $2.8bn this year, as the sector slowly recovers.