Record profits by IAG driven by routes across Atlantic
The International Aviation Group (IAG), the parent company of leading European airlines including British Airways and Iberia, has reported a record operating profit of EUR 3.5 billion in the year 2023.
In a press statement, IAG says that the operating profit was significantly higher than EUR 1.25 billion recorded last year and also ahead of 2019 figure when it was EUR 3.25 billion.
It says that the strong growth in operating profit in 2023 was underpinned by robust and sustainable demand for travel, alongside continued investment in its transformation to drive long-term earnings growth.
The aviation group says that strong and sustained demand for travel, in particular in leisure, is likely to continue in the year ahead. Passenger unit revenue for the year was 8.2 pc higher than in 2022, with strong leisure traffic recovery and business traffic recovering more slowly. It adds that the premium leisure segment continued to perform very well.
It says its capacity last year grew by 22.6 pc over 2022 and focussed on its core North Atlantic and South Atlantic markets.
“In 2023, IAG more than doubled its operating margin and profits compared to 2022, generated excellent free cash flow and strengthened its balance sheet position, recovering capacity to close to pre-COVID-19 levels in most of its core markets. In 2024, we will execute on our strategy, building long-term value into the business. We will focus on strengthening our core airline businesses and on developing IAG Loyalty and our other asset-light growth opportunities, and we will do this while operating under a strong financial and sustainability framework. Our airlines operate in the largest and most attractive markets globally and we will continue to invest in our brands to transform the business, improve the customer experience and support the delivery of sustainable growth and world-class margins,’’ says Luis Gallego, Chief Executive Officer, IAG.
The company says it is continuing to invest in its core markets and in growing its global leadership positions and that it plans to grow capacity in terms of Available Seat Kilometres (ASK) by about 7 pc in 2024. In particular British Airways will continue to rebuild to its pre-COVID-19 long-haul capacity and Iberia to grow efficiently in the attractive and growing Latin American market, says IAG.
