LONDON- British Airways’ (BA) parent company, International Airlines Group (IAG), is set to report a significant surge in annual profit, driven by high travel demand and reduced fuel costs.
The group’s financial results, expected on February 28, indicate a substantial revenue boost despite industry challenges.
Photo- IberiaBritish Airways Parent IAG Profit Surge
International Airlines Group (IAG), the parent company of British Airways (BA), Iberia (IB), Vueling (VY), and Aer Lingus (EI), is projected to report a 15% increase in annual profit, reaching $4.3 billion.
This growth follows an 8% rise in total revenue to 31.7 billion euros (£26.3 billion), as more travelers took to the skies amid falling fuel prices.
Despite widespread flight disruptions during peak travel periods, IAG’s load factor—a key measure of how full flights are stood at 89.9% in its last reported results.
The company also benefited from deploying more fuel-efficient aircraft, contributing to a 4.2% reduction in fuel costs before Christmas.
Photo: MCO AirportChallenges Faced
Although IAG has demonstrated resilience, the company faces potential challenges. German travel operator Tui (BY) recently warned of slower booking growth for the upcoming summer, raising concerns about future demand.
Investors and analysts will be closely monitoring IAG CEO Luis Gallego’s insights into the group’s outlook for the peak travel season.
British Airways (BA) also faced criticism over changes to its loyalty program, switching from a distance-based points system to a revenue-based model.
The move sparked backlash among frequent flyers, with industry observers suggesting it could strain customer loyalty.
Despite these challenges, IAG’s stock has doubled over the past year, reflecting investor confidence in the airline sector’s resilience.
Market analysts, including Michael Hewson of MCH Market Insights, acknowledge potential reputational risks but highlight the broader strength of the travel industry as a key factor in IAG’s continued growth.
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