British Airways owner IAG grows revenue and profit despite taking a £58m hit over IT failure

 
Caitlin Morrison
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IT chaos hit British Airways today (Source: Getty)

British Airways owner International Consolidated Airlines Group (IAG) today reported an increase in revenue and operating profit in the six months to 30 June.

The figures

Revenue was up 0.9 per cent at €10.9bn (£9.7bn) in the first half, compared with €10.8bn this time last year, with passenger revenue rising 0.4 per cent to €9.6bn.

Operating profit after exceptional items rose 13.8 per cent to €898m from €789m, and earnings per share went up 25.6 per cent to 28.5 cents.

Why it's interesting

British Airways was hit by a massive IT failure over the second bank holiday weekend in May, causing travel chaos for thousands of holidaymakers, and today IAG said the cost of the additional compensation fees and baggage claims relating to the disruption would be €65m, or £58m.

This is markedly lower than the £80m cost that chief exec Willie Walsh warned of at the IAG annual general meeting in June, and investors were apparently pleased with today's numbers, with shares rising 3.3 per cent to 613.5p at the open.

What IAG said

Walsh hailed a "very strong performance" in the second quarter, and said revenues had benefitted from Easter as well as a "weak base last year".

"Sales continue to be well ahead of our expectations," he added. "We've ordered three additional aircraft and are considering other European bases for the operation."

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