International Airlines Group (IAG) - the British company formed by merging British Airways and Iberia Airlines in 2011 - has reported third quarter operating profit of €690m (£574.89m), from €270m for the same period last year. The profit jump comes as Iberia's restructuring programme sees progress. (Release)
In October, Iberia unveiled its new corporate image as part of its transformation plan. This month, it will start to operate its fifth Airbus A330. Vueling (the budget Spanish airline, of which Iberia owns 46 per cent), will offer seven new destinations out of Barcelona.
The group's chief executive Willie Walsh said that, although Iberia saw an improved performance, with an operating profit of €74m in the quarter compared to an operating profit of €1m last year, "the airline must continue to implement its restructuring plan and reach agreement on productivity changes to bring about long term sustainable profits and growth."
IAG's profit before tax was €606m in the period (three months to 30 September), up from €244m in 2012. Total revenue was up 6.9 per cent in the third quarter 2013 (€5,406m), with passenger revenue up 10.4 per cent at €4,801m.
For the first nine months of 2013, operating profit stood at €657m (€17m in 2012) and revenue was up 3.9 per cent to €14,113m. Passenger revenue was up 2.3 per cent. Last month, the group saw an increase of 8.9 per cent in traffic (measure in Revenue Passenger Kilometres) versus October 2012.
Fuel costs, IAG says, were down 3.4 per cent in the nine month period to €4,475m, with non-fuel costs up 0.5 per cent at €8,981m in the same period. The group should see a reduction in non-fuel unit costs for the year as a whole.
The company expects an operating profit, before exceptions items, of around €740m. Group capacity, it says, will grow by 5.2 per cent, a reduction of 2.4 per cent excluding Vueling. "Moving into 2014, we expect the driver of revenue growth to shift from yield to volume due to new British Airways route launches and the strong growth of Vueling."