IAG overcomes rising fuel prices to report sharp increase in profits

IAG

International Airlines Group has reported operating profit before exceptional items of €3,230 million for the year to December 31st, up 9.5 per cent on the prior year figure of €2,950 million.

Profit after tax and before exceptional items stood at €2,481 million, up 11.2 per cent, while adjusted earnings per share were up 15.1 per cent.

International Airlines Group own British Airways, Iberia, Aer Lingus and Level, among other carriers.

Releasing the results, IAG chief executive Willie Walsh said: “Yet again, we’ve improved our operating profit this year and our adjusted earnings per share grew by 15.1 per cent.

“This was a very good performance despite three significant challenges: fuel prices increasing 30 per cent, considerable air traffic control disruption and an adverse foreign exchange impact of €129 million.”

IAG proposed a final dividend of 16.5 euro cents per share, while adding a special dividend of 35 euro cents per share, or approximately €700 million.

Walsh added: “At constant currency, passenger unit revenue improved by 2.4 per cent while non-fuel unit costs decreased by 0.8 per cent on capacity growth of 6.1 per cent.

“In 2018, we completed our second share buyback which was worth €500 million.

“We are also returning more than €1.3 billion to our shareholders via ordinary dividends of €615 million and a special dividend of approximately €700 million.

“This is around €260 million higher than in the previous year.”

Looking ahead, IAG expects its 2019 operating profit, at current fuel prices and exchange rates, and before exceptional items and impacts of IFRS16, to be in line with €3,230 million reported in 2018.

Passenger unit revenue is expected to improve at constant currency and non-fuel unit cost is expected to be flat at constant currency.

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