IAG results impacted by ATC strikes

victoria@aviationnews-online.com
By victoria@aviationnews-online.com August 3, 2018 16:04

IAG results impacted by ATC strikes

International Consolidated Airlines Group (IAG) has reported strong pre-tax profits of €835 million for the second quarter of 2018, up from €790 million last year.  This fell slightly short of analysts’ expectations of €848 million. Passenger unit revenue for the quarter was down 1.9%, up 2.3% at constant currency, with non-fuel unit costs falling 2%.

Chief executive Willie Walsh commented that French Air Traffic Control strikes caused Vueling to incur an additional €20 million of disruption costs in the quarter.

Total revenue for the first half of 2018 rose 3.1% to €11.2bn and basic earnings per share up more than 140% to €0.68. Revenue per available seat kilometre (ASK) fell 1.3% in the first half of the year, while cost per ASK also fell by 3.1% owing to increased fuel costs. IAG’s operating profit for the six months to June 30, 2018 was €1.115bn before exceptional items, an improvement of €165 million from last year. British Airways made a profit of €868 million before exceptional items (2017 restated: €740 million); Iberia made a profit of €102 million (2017 restated: €87 million); Aer Lingus made a profit of €104 million (2017 restated: €53 million) and Vueling’s loss was €11 million (2017 restated: loss €7 million).

IAG expects its operating profit for 2018 to show an increase year-on-year. “Both passenger unit revenue and non-fuel unit costs are expected to improve at constant currency.”

Walsh also confirmed that IAG intends to sell its 4.6% stake in Norwegian Air after failing to negotiate a takeover.

Walsh said: “We’re not going to keep the shares, we’re not an investor. We bought that small stake to initiate a conversation and if that conversation is not going anywhere, as it’s not, we’re not going to hold on to those shares.”

In July, IAG Group traffic in July, measured in Revenue Passenger Kilometres, increased by 7.5% compared to July 2017; Group capacity measured in Available Seat Kilometres rose by 5.7%.

On 17 July, LEVEL launched its shorthaul operations from Vienna where it will have four A321 aircraft that will operate to 14 European destinations. Earlier in the month, LEVEL started flights from Paris Orly to Montreal and Guadaloupe. Two new A330-200s will be added to its fleet, bringing a total of seven A330-200 aircraft in Paris and Barcelona next year.

victoria@aviationnews-online.com
By victoria@aviationnews-online.com August 3, 2018 16:04