6 AUGUST 2018
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A loss of €11m at International Airlines Group (IAG) member Vueling took the gloss off the group’s financial performance for the first half of 2018, according to figures released last week, while British Airways continued to set the pace.
The group’s second-quarter operating profit before exceptional items was €835m, 5.7% up on last year but below market expectations of €848m. Despite the generally good figures, the shortfall saw IAG shares fall nearly 3% on Friday.
All members of the group except Vueling showed increased operating profits. BA’s figure was €868m before exceptional items (2017: €740m); Iberia €102m (€87m) and Aer Lingus €104m (€53m). Vueling’s €11m loss was €4m higher than the equivalent 2017 loss.
IAG CEO Willie Walsh said the Vueling figure was attributable to a €20m cost caused by French ATC strikes. IAG, along with easyJet and Ryanair, is filing a complaint about the strikes to the European Commission.
However, he added, IAG was reporting “another good set of results” for the second quarter of 2018, with strong performance in both unit revenue and costs. Passenger unit revenue increased by 2.3% while non-fuel unit costs went down 2%.
Meanwhile, Walsh said IAG might sell its shares in Norwegian after a takeover bid was rebuffed (see “Walsh, Norwegian and Heathrow” in this issue).
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