BA owner IAG sees sales rebound above pre-Covid levels

International Airlines Group, the owner of British Airways, has seen sales surpass pre-Covid levels, despite ongoing disruptions to air traffic.

The Anglo-Spanish airline giant, which also owns Iberia and Aer Lingus, revealed revenues in the three months to September were €7.3 billion, up 0.9 percent from the same period three years ago and more. than double the amount he earned last year.

This was achieved even though passenger capacity was only 81 percent of volumes in 2019, partly as a result of London Heathrow Airport imposing a daily limit of 100,000 passengers over the summer and also disruptions in Europe and the US.

Due to staff shortages, Heathrow – Europe’s busiest airport – has struggled with a rapid influx of customers, many of whom experienced long queues, flight delays or cancellations before the limit was introduced.

Other major European airports also faced problems in the summer.

IAG’s trade was also significantly impacted by travel restrictions in the Asia-Pacific region, where lockdowns were often much stricter, especially in China.

Still, all of the company’s airlines achieved profitability, driven by premium vacation travel that fully recovered to pandemic levels as customers vacationed in Europe, the Americas and the Caribbean.

International Airlines Group Shares fell 2.9 percent to 116.2 during late morning on Friday. In 2022, their value has fallen by about a quarter so far.

The FTSE 100-listed IAG recovered from a loss of €574 million in the third quarter last year to a profit of €853 million this time around.

Based on current fuel prices and exchange rates, it forecasts operating income of approximately €1.1 billion for this year.

Luis Gallego, CEO of IAG, praised the ‘strong performance of the group, although he warned: ‘While demand remains strong, we are aware of the uncertainties in the economic outlook and continued pressure on households.

“Against this backdrop, we focus on adjusting our operations to meet demand, strengthening our balance sheet by restoring our profitability and cash flows, and taking advantage of our high liquidity.”

An improvement should come from Heathrow ending passenger capacity limits on Sunday, which it previously planned to do last month before the measure was extended due to staff shortages.

But the airport warned yesterday that the limits could be reintroduced over the Christmas period to avoid potential inconvenience to passengers.

“We are working with airlines to agree on a highly targeted mechanism that would align supply and demand on a small number of peak days leading up to Christmas if needed,” it noted.

In addition, current inflationary pressures, largely stemming from rising energy prices, Russia’s large-scale invasion of Ukraine and a stronger dollar mean many consumers could delay traveling abroad.

Derren Nathan, head of equity research at Hargreaves Lansdown, said: “As the cost of living crisis deepens in many key markets, holidays will disappear from the essentials list, so we are cautious about next year.”