Classifieds | Archives | Jobs | About TGT | Contact | Subscribe
 | 
Last updated 0 minute ago
Printer Friendly Version | TGT@Twitter | RSS Feed |
HOME LOCAL MIDEAST ASIA WORLD BUSINESS SPORT OPINION WRITERS
IAG’s profit beats targets
July 30, 2017
 Print    Send to Friend

LONDON: International Consolidated Airlines Group’s (IAG) profit has beaten analysts’ estimates in the second quarter. Owner of British Airways (BA) broke ranks with some of its rivals, when it forecast rising airfares would boost annual operating profit, contrasting with their warnings of pressure on prices.

IAG Chief Executive Willie Walsh said that June was a record month for bookings on British Airways, showing that an IT meltdown at the end of May had no immediate impact on demand.

The company said that it estimated that the cost from the outage, which left 75,000 passengers stranded and led to heavy media criticism, would total 65 million euros ($76 million).

IAG, which also owns the Iberia, Aer Lingus and Vueling airlines, now expects at least a 10 per cent improvement in operating profit year-on-year having previously predicted only a rise.

Walsh struck a different tone to competitors such as Lufthansa, EasyJet and Ryanair. While all of them either stuck to or raised their profit targets this month, their updates were overshadowed by caution on fares over the summer.

“All we can say is what we see. Clearly what we see in terms of our performance does appear to be somewhat different to what others are saying,” Walsh told reporters.

“It may not be different to what they’re seeing, but it’s certainly different to what they’ve said. But we’re calling it as we see it, and our first half performance was very strong.”

Air France-KLM also offered more optimism on pricing when it announced results on Friday.

Walsh said that a pact between Delta, Air France-KLM and Virgin, which was announced on Thursday, was unlikely to change much in the industry, but that consolidation was generally positive.

He said that IAG was not among the 10 parties to submit a non-binding offer for Alitalia last Friday, but he did not rule out taking part in M&A in the German market.

“There may be things that are interesting to us (in Germany). We will look at what happens with Air Berlin AB1. There’s nothing that we’re actively particpating in,” Walsh told analysts. “We are more closely looking at Air Berlin, we are not looking at Alitalia.”

Operating profit for the six months to June 30 before exceptional items was 975 million euros, up 37.3 per cent compared to the previous year, while the quarterly number was 805 million euros.

The quarterly figures beat consensus estimates by 9 per cent, analysts at RBC said, adding that guidance of a double-digit improvement in operating profits supported their view that summer 2017 would be strong.

Meanwhile, BT suffered a 42 per cent drop in quarterly profit after taking a fresh charge to avoid legal claims from two major investors over an Italian accounting scandal.

Reuters

Add this page to your favorite Social Bookmarking websites
Comments
 
Post a comment
 
Name:
Country:
City:
Email:
Comment:
 
    
    
Related Stories
UK industry on growth track
LONDON: British industrial output looks set to make a strong contribution to economic growth in the final months of 2017 but construction is likely to drag, official data..
Next leads retailers up
LONDON: Retailers stole the spotlight among UK stocks on Wednesday after Next delivered a strong Christmas update, as the FTSE 100 edged down from record highs. Britai..
BoE to spare EU banks from costly rules, if Brexit goes well
LONDON: The Bank of England (BoE) said on Wednesday it planned to spare European banks costly extra capital rules once Britain left the EU, but warned of “consequences” i..
BoE to allow EU banks to operate in UK as normal after Brexit
LONDON: The Bank of England will allow European banks to continue selling their services in the United Kingdom without having to create expensive subsidiaries after Brita..
UK employment rate declines
LONDON: The number of people in work in Britain fell again, suggesting employers are turning more cautious as Brexit nears, and while pay growth quickened slightly, it re..
FRONTPAGE
 
GALLERY
 
PANORAMA
 
TIME OUT
 
SPORT
 
 
Advertise | Copyright