British Airways owner IAG sees record profits as air travel recovers

Image source, Reuters

  • Author, Faarea Masud
  • Role, Business reporter

The owner of British Airways has posted record half-year profits helped by higher fares and the continued rebound in travel post-pandemic.

Airline group IAG reported operating profits of 鈧1.3bn (拢1.1bn) after being boosted by a "strong" recovery in leisure travel.

In the same period last year it had posted a loss of 鈧446m.

IAG chief Luis Gallego said the group was aiming to be back at pre-pandemic levels of demand by the end of year.

However, the company - which also owns Iberia, Aer Lingus and Vueling - said that while there was no sign of weakness in forward bookings at the moment, it was "mindful of wider uncertainties" that could affect fuel prices and consumer confidence in the months ahead.

IAG said flight capacity was back to 94% of pre-pandemic levels in the first half of the year.

Fares were up by about 9.5% on average, and revenue reached 鈧13.6bn - an increase of nearly 45% from a year earlier.

IAG said it had seen a "strong leisure traffic recovery", adding premium leisure demand "continued to perform very well".

"Customer demand remains strong across the group, particularly for leisure travel, with around 80% of passenger revenue for the third quarter already booked," said Mr Gallego.

"And our airlines have put in place plans to support operations during the busy summer period."

However, IAG said that some of its operations "are not where we would want them to be and this is affecting our overall customer service".

It said French air traffic control strikes were affecting most of its airlines, while global supply chain issues were "reducing aircraft availability".

The company said British Airways was "particularly affected" because of its "London exposure and complex schedule".