IAG (International Airlines Group) has said its earnings soared through the third quarter due to “the effectiveness of our strategy and group-wide transformation”.
The company, which owns British Airways, Aer Lingus, Iberia, Vueling and LEVEL, reported a Q3 operating profit of £1.7bn – up 15.4 per cent from £1.4bn year-on-year.
Meanwhile total revenues rose to £7.7bn, up 7.9 per cent from £7.1bn year-on-year.
IAG also announced a £291mn share buyback scheme, adding that it expects its “strong financial performance to continue for the rest of the year”.
CEO Luis Gallego said: “We achieved a very strong financial performance in Q3 2024, with a 15.4 per cent increase in operating profit compared to the same period last year and improving our margin to 21.6 per cent.
“This is due to the effectiveness of our strategy and group-wide transformation. We are also delivering on our commitment to provide sustainable returns for shareholders.
“Demand remains strong across our airlines and we expect a good final quarter of 2024 financially.”
The CEO added that IAG is “absorbing all the inflationary costs with good cost control”, and is “improving operational performance”, with British Airways’ punctuality up 10 per cent year-on-year.
Gallego said the North Atlantic market is “very strong” for British Airways, with IAG recording a 3.9 per cent boost in capacity for routes year-on-year, and a 3.5 per cent increase in revenue. The load factor rose by 2.2 percentage points to 89.1 per cent.
Reacting to IAG’s Q3 results, Julie Palmer, partner at management consultancy company Begbies Traynor, said: “Following the important summer season, IAG appears in rude health, with [its] airlines’ Q3 results showing improved figures across the board.
“In contrast to its peers, heavily affected by Boeing delivery delays and falling ticket prices, the British Airways owner was able to materially increase passenger revenues leading to a near 8 per cent uptick in overall revenues.
“This is all the more impressive given it has also been able to sustain some solid capacity growth.”
She added: “This is not to say IAG has been immune to the challenges facing the industry this quarter.
“Aer Lingus saw a negative impact from the pilots’ strike, but with its strong European network, the group is particularly adept at capitalising on strong customer demand.”
“There will be issues to navigate over the quieter winter period, and performance in regions like Africa and Asia-Pacific is not going quite as well currently,” she said.
“But IAG expects momentum to continue for the rest of the financial year and the announcement of a £291mn share buyback programme today indicates just how strong a position IAG believes it is in”.
