The UK economy has shrunk by a quarter as a result of the coronavirus pandemic, with output falling at the fastest monthly rate on record in April following a steep decline in March, the Financial Times reported. Output in the UK plunged 20.4 per cent in April, compared with the previous month, according to data from the Office for National Statistics. This is by far the largest contraction since monthly records began in 1997 and follows a 5.8 per cent contraction in March, the previous record fall. By the end of April the economy was about 25 per cent smaller than in February.

Deutsche Lufthansa AG’s Austrian Airlines division will shrink to 80% of the size it was before the coronavirus crisis, Chief Executive Officer Alexis von Hoensbroech said in an interview with the newspaper Der Standard, Bloomberg News reported. “From today’s perspective that would mean that we have 1,100 employees too many,” he said. “We are planning two years of short-hours work, so there can be no layoffs for that long,” but a large part of the planned reduction by 2022 will be through staff turnover, he added.

The UK pensions industry has warned that emergency measures aimed at helping struggling businesses during the coronavirus pandemic could leave millions of pensioners worse off, the Financial Times reported. In recent weeks the Pensions Regulator, the Pension Protection Fund and trade bodies representing retirement schemes have raised concerns with the government that the Corporate and Governance Insolvency Bill could have serious unintended consequences for retirement plans and their members.

Mothercare’s Irish franchise owner placed its 14 baby products stores into liquidation on Friday, becoming one of the first major retail outlets in Ireland to blame the coronavirus lockdown for its demise, Reuters reported. Mothercare Plc still operates around 1,000 overseas franchise stores following the collapse of its UK business, where it fell victim to stiff competition from online retailers and rising costs across the retail industry.

Babcock International is deferring its dividend amid uncertainty over the impact of Covid-19 on its defence business, and after a £503m exceptional charge pushed it into a headline pre-tax loss last year, the Financial Times reported. Archie Bethel, the outgoing chief executive of the UK defence contractor, warned the group would this year miss profit margin targets set last June, as it wrestled with the consequences of the virus on productivity. In particular, business with a short-term cycle — roughly 20 per cent of revenues — would be hit this year by a drop in demand.

Centrica is to cut a further 5,000 jobs as the lossmaking energy supplier accelerates cost cuts after the coronavirus crisis added to several difficult years marred by mass redundancies, profit warnings and dividend cuts, the Financial Times reported. Half of the job cuts announced on Thursday will come from leadership, management and corporate roles as Chris O’Shea, who took over from Iain Conn as chief executive in March, seeks to simplify the energy group behind the British Gas brand. The latest redundancies add to 12,500 jobs slashed since 2015 in an effort to save £2bn by 2022.

Deutsche Lufthansa AG revealed the full extent of potential job losses, saying cost cuts and moves to shrink the fleet will leave it with a surplus of 22,000 full-time positions, Bloomberg News reported. Europe’s biggest airline has begun talks with unions representing pilots, flight attendants and ground staff and aims to minimize the number of people dismissed by reducing working hours and other measures, it said in a statement. An agreement should be reached by June 22.

Ukraine’s recovery from its coronavirus-induced slump may take four years, the International Monetary Fund warned, after approving $5 billion of aid for the eastern European nation this week, Bloomberg News reported. “Under the baseline, the pace of economic growth is projected to pick up only gradually in the years ahead, to around 4%, as some further progress is made in implementing structural reforms,” the IMF said Thursday.

British fashion retailer Quiz said on Wednesday it would place its stores unit into administration and then buy the business back so it can try to renegotiate better rental terms, Reuters reported. Bricks and mortar retail in the United Kingdom was facing a major structural challenge prior to the outbreak of the coronavirus pandemic with the economics of operating stores on traditional leases proving increasingly difficult.

Deutsche Bank has warned its provisions for bad loans will surge to the highest level in more than a decade this quarter as the coronavirus crisis leaves the global economy mired in recession, the Financial Times reported. Germany’s biggest lender had earmarked a provision of just €506m for bad loans in the first three months of the year, but cautioned on Wednesday that the figure would increase this quarter.