IAG profits boosted by progress at Spain’s Iberia
Iberia has — in recent months — settled a number of employee disputes on work and pay, which IAG has said will see the Spanish carrier return to profit.
“The performance, so far this year, has been one that has pleased us significantly given the reduction in operating losses in the first quarter.
“We’re particularly pleased with the continued progress being made in Iberia,” said group CEO Willie Walsh.
He added that the company, Europe’s largest airline by market value, was on track to make an operating profit of €1.8bn in 2015.
The company posted an operating loss — before exceptional items — of €150m in the three months to the end of March, down from a €278m loss for the corresponding period last year, and better than analysts’ expectations of a €162m loss.
Like many airlines and tour operators IAG — which also owns Spanish low-cost carrier Vueling — generally reports a loss in the traditionally weaker first three months of the year and makes the bulk of its profits in the summer months.
The company also reported that group passenger traffic in the first four months of this year was up 5.5%, on a like-for-like basis, but average loadings were down 0.1 percentage points at 77.7% of capacity.
Looking ahead, IAG said cost-cutting would help it increase operating profits in 2014 by at least €500m, from the €770m made last year, putting it on track to meet current analysts’ forecasts for about €1.3bn.
IAG’s assurance that it was on track to meet expectations for this year echoed recent updates from rival legacy carriers AirFrance-KLM and Lufthansa.
The company also said British Airways, the biggest and most profitable part of its business which partners American Airlines in the lucrative transatlantic market, was benefiting from fuel efficiencies on its new aircraft.
— Reuters
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