Strong summer prompts IAG to raise forecast

Strong summer prompts IAG to raise forecastBritish Airways parent company International Airlines Group raised its full year profit forecast today following a strong summer.

IAG, which also includes Iberia and Spanish low-cost carrier Vueling, saw operating profits for the three months to September 30 rise by €210 million to €900 million.

BA contributed €607 million against €477 million in the same period last year, while Iberia more than doubled its operating profit to €162 million in the quarter. Vueling’s profit was almost pegged at €140 million. Revenue for the quarter was up 8.5% to €5.8 billion.

The overall improvement over the summer months helped push up the operating profit in the first nine months of IAG’s financial year by €473 million to more than €1.1 billion.

Capacity was increased 10.5% in the nine months and traffic rose by 9.5%, decreasing the seat factor by 0.7 points to 80.7%.

IAG said it expects to produce an improvement in operating profit before exceptional items in the range of €550 million to €600 million, from a base of €770 million in 2013.

Reviewing the quarter, chief executive Willie Walsh said: “We continued to grow capacity efficiently and both our non-fuel and fuel unit cost performances were strong with the latter boosted by the introduction of new, more efficient aircraft into our fleet.

“British Airways made an operating profit of €607 million, compared to €477 million last year, and grew capacity while retaining its focus on cost control.

“Iberia’s operating profit increased to €162 million from €74 million last year highlighting its strong cost discipline combined with the continued benefits of restructuring.

“Vueling continued to grow, developing new bases in Italy and Belgium, with an operating profit of €140 million compared to €139 million last year.

“In the nine months, we made an operating profit of €1,130 million before exceptional items, up by €473 million from last year.”

Sourced from Travel Weekly

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