IAG’s record results show profit for all three airlines

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By admin February 27, 2015 20:25

IAG’s record results show profit for all three airlines

International Consolidated Airlines Group (IAG) has reported record consolidated results for the year to December 31, 2014 boosting its shares by more than 5% in early trading. The airline group posted a fourth quarter operating profit, before exceptional items, of €260 million, compared to an operating profit of €113 million in 2013. Revenue for the quarter rose 9.9% to €5,015 million, up 5.8% at constant currency. Non-fuel unit costs for the quarter down 0.8 per cent at constant currency.

For the full year, IAG’s operating profit rose 80.5% to €1,390 million compared to €770 million in 2013, before exceptional items. Revenue for the year was up 8% to €20,170 million and passenger unit revenue for the year dipped 0.4% at constant currency. Fuel unit costs for the year were down 7.8% and non-fuel unit costs before exceptional items for the year fell 1.9%, down 3.9% at constant currency. IAG had cash of €4,944 million at December 31, 2014, which was an increase from the €1,311 million for 2013 on year end. Adjusted gearing was up 1 percentage point to 51% and adjusted net debt to EBITDAR improved 0.6 to 1.9 times.

The most startling transformation has been seen at Iberia, which made an operating profit of €50 million for 2014 compared to an operating loss of €166 million last year. Willie Walsh, IAG Chief Executive Officer, said: “The airline’s turnaround has been remarkable, both financially and operationally, and we’re very proud of its achievement especially its strong cost discipline. In 2013 we said our intention was for Iberia to breakeven in 2014 and it has fulfilled that promise.”

British Airways’ operating profit to €1,215 million from €762 million last year, which Walsh said showed “significant progress towards its long term targets”. Vueling made an operating profit of €141 million, compared to an operating profit of €139 million in 2013.

“We achieved a strong unit cost performance, down 4.1%, through increased productivity, supplier cost savings and lower fuel unit costs,” said Walsh. “The latter was boosted by the introduction of more efficient aircraft into our fleet and lower fuel prices in the last quarter of the year. However, the positive effect of the oil price reduction has been partly offset by hedging and significant currency impact.”

At current fuel prices and exchange rates, IAG stated that it expects to generate an operating profit in excess of €2.2 billion in 2015, with total fuel costs of around €5.9 billion, based on capacity growth of approximately 5.5%.

admin
By admin February 27, 2015 20:25