IAG Posts First Q1 Profit Since 2019
International Airlines Group (IAG) has announced stronger-than-expected first-quarter Q1 2023 results.
International Airlines Group (IAG) has announced stronger-than-expected first-quarter Q1 2023 results.
DALLAS - International Airlines Group (IAG), the parent of Aer Lingus (EI), British Airways (BA), Iberia (IB), Iberia Express (I2), LEVEL (IB), Vueling (VY) and IAG Cargo, has announced stronger-than-expected first-quarter Q1 2023 results.
The group posted its first Q1 profit since 2019, with an operating profit of some €9m (US$10m). This was up from a €718m (US$791m) loss for the same period in 2022. These results, the group said, were 'better than expected due to strong yield performance across the Group and the benefit of a lower fuel price.'
The focus remains on the group's core Latin America and North Atlantic markets. These, the group added, were now back to pre-pandemic levels. Strong leisure demand from both EI and VY has also boosted the company's results.
Luis Gallego, IAG CEO, said," IAG has delivered a strong first quarter financial performance, as Group airlines recovered capacity to close to pre-pandemic levels. Iberia contributed a record first-quarter profit and all our airlines performed above expectations, benefiting from robust demand and a lower fuel price in the quarter. We are seeing healthy forward bookings with leisure demand particularly strong while business travel continues to recover more slowly.
"As we return to more normal operations, we continue to invest in sustainability, including more fuel-efficient aircraft, and in customer experience, updating the business cabins for British Airways and Iberia. Over the past year we have recruited thousands of new employees across the Group and strengthened our operations so that we are ready to deliver for our customers during the summer peak.
"We have the right model to succeed with synergies and efficiencies across the Group and I want to thank all our employees for the role they have played in our continued recovery."
In terms of the group's individual airlines, Iberia delivered its best-ever Q1 results, making it one of the world's most profitable airlines for the quarter, thanks to increased demand for Spain and Latin America.
London-based British Airways returned to profit in Q1 for the first time since 2019. Strong demand again came from the leisure market, while corporate travel is also recovering, albeit at a slower pace.
Low-cost unit Vueling additional winter season capacity across its leisure-orientated network has driven up unit revenue and load factors. This in turn has helped improve IAG's sustainable ancillary revenue.
However, Aer Lingus has been affected by the slow recovery in the business sector, but its leisure routes continue to perform well. The official statement said the Dublin-based carrier was 'more seasonally exposed than the other airlines.'
Meanwhile, IAG Cargo saw revenues fall 25% year-on-year, but its yields remain above 2019 levels.
Looking ahead, the group said that it had an 'encouraging outlook for the summer, with around 80% of quarter two revenue now booked.' Full-year profit guidance, before exceptional items, is now expected to be around the top end of the previous guidance of €1.8bn (US$1.9bn) to €2.3bn (US$2.5bn).
Meanwhile, IB has announced Fernando Candela as its new acting president and chief executive officer, replacing Javier Sanchez-Prieto. The changeover will occur in July, and the new boss will remain in place until the end of the year.
Candela previously held the helm at LEVEL and Iberia Express. He will now lead the Madrid-based airline through the takeover of Air Europa (UX).
https://airwaysmag.com/iag-may-debt-after-air-europa-purchase/
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