IAG Revenue Up Slightly But Earnings Are Down

International Consolidated Airlines Group (IAG), the parent of British Airways, Aer Lingus, Iberia and several other carriers, reported a 6.9% hit in operating profit to €1.43 billion ($1.59 billion)  before exceptional items, primarily due to a British Airways pilots strike and other disruptions, including threatened strikes by Heathrow airport employees. The disruptions adversely impacted operating profit by €155 million.

Cargo revenue for the three-month period ended Sept. 30 topped out at €269 million, a 7.2% slide from the €290 million posted for the same period in 2018. Cargo volume at IAG, as with the rest of the industry, has weakened as the year has progressed. IAG said Oct. 31 that cargo revenue is down 2.6% for the first three quarters, to €825 million. Third-quarter cargo yield dipped 2.4% to €19.94 cents.

Overall, revenue increased by 2.4% year-on-year to €7.31 billion ($8.15 billion) from €7.14 billion.

IAG's fuel bill increased €136 million during the quarter, with fuel unit costs up 4.2% at constant currency. At constant currency, passenger unit revenue decreased by 1.1% while non-fuel unit costs were up 1.1%.

IAG reiterated a forecast for full-year operating profit before exceptional items to be €215 million lower than 2018's pro forma figure of €3.49 billion, should current fuel price and exchange rates remain constant.

Image by Mark Timberlake from Pixabay