IAG sees first half profit rise

Lloyd Doyle
August 6, 2018

However, IAG chief executive Willie Walsh said he was happy with the performance, telling reporters on a call that the trans-Atlantic performance was "very good".

"Vueling was particularly affected and incurred an additional 20 million euros (£17.8 million) of disruption costs in the quarter".

"These strikes are also having a significant negative impact on the Spanish economy and tourism", Walsh pointed out.

He noted that some of the miss has come from ongoing French air traffic control strikes, which have prevented the growing Vueling brand from breaking into a half-year profit, while LEVEL was also starting to take off and IAG has its eyes set on the expanding market for low-priced long-haul.

Earnings after taxation flew to 1.4 billion euros ($1.6 billion) in the first six months of 2018 compared with 607 million euros a year earlier, IAG said in a results statement.

"At constant currency, our passenger unit revenue increased by 2.3 per cent while non-fuel unit costs went down two per cent". Earlier in the month, the carrier started flights from Paris Orly to Montreal and Guadeloupe. IAG, however, reassured investors that it still expects its full-year operating profit to show an increase year-on-year.

However, the future of Level may well be thrown into doubt should IAG complete its proposed takeover of Norwegian. "But obviously, if there's something to say, we'll see it and nothing to say at the moment". Nothing concrete has materialized and Bjorn Kjos, the CEO of Norwegian, has since said other airlines are interested in doing a deal as well.

Any deal for Norwegian would supplement IAG's own growing low-priced, long-haul brand Level, which it has grown since launch last June.

Walsh said earlier on Friday that he was still interested in Norwegian but there were now no active discussions.

IAG bought a 4.6% stake in Norwegian in April and has made two offers for the airline, both of which were rejected.

Other reports by Iphone Fresh

Discuss This Article