IAG Posts Q3 Profit Despite Heathrow Passenger Cap | Business Travel News

International Airlines Group, which owns British Airways, Iberia, Aer Lingus and Vueling, on Friday posted third-quarter revenues that exceeded pre-pandemic levels, despite capacity restrictions imposed at London Heathrow throughout the summer.

The group reported revenue of €7.3 billion for the quarter, 0.9 percent higher than 2019, and a profit of €1.2 billion.

IAG CEO Luis Gallego said all airlines were “significantly profitable”, with leisure demand back to pre-pandemic levels and business travel “recovering steadily.” 

Passenger capacity from July to September was 81 percent of 2019 levels, up from 78 percent in the second quarter and largely driven by short-haul European travel and flights to North America. Passenger yield for the quarter was 23 percent higher than in 2019, with a load factor of 87 percent – 0.7 points below 2019.

Despite the 100,000 daily passenger limit at Heathrow, the group reported premium leisure revenue for the quarter had fully recovered to pre-crisis levels, while business revenues stood at approximately 75 percent of 2019 figures.

Against a backdrop of rising inflation and fuel costs, the group expects its 2022 operating profit to be approximately €1.1 billion, with overall passenger capacity for the year at 78 percent of 2019 levels. 

Net debt is expected to increase by year end, linked to seasonal booking patterns and capital expenditure associated with aircraft deliveries in the fourth quarter. 

“While demand remains strong, we are conscious of the uncertainties in the economic outlook and the ongoing pressures on households,” Gallego said, adding the group is “focused on adapting our operations to meet demand.”

Originally published by BTN Europe.