10th May 2019 07:35
LONDON (Alliance News) - International Consolidated Airlines Group SA on Friday reported a significant drop in profit during the first quarter of the year, hampered by the later timing of Easter this year and higher fuel costs.
Meanwhile, traffic figures for the month of April saw passenger number up 7.3%, indicating a good start to the second quarter. Easter Sunday was on April 21.
For the three months to March 31, the parent of British Airways, Iberia and Aer Lingus posted pretax profit of EUR86 million, down 90% from the previous year's EUR885 million.
Revenue in the quarter rose 5.9% to EUR5.31 billion from EUR5.02 billion a year prior, with Passenger revenue up 5.2%, Cargo down 0.4% and Other revenue up 20%.
Significantly higher fuel costs, amounting to EUR1.36 billion compared to EUR1.11 billion, and more than doubled employee costs to EUR1.20 billion from EUR510 million, reduced the company's profitability.
"In a quarter when European airlines were significantly affected by fuel and foreign exchange headwinds, market capacity impacting yield and the timing of Easter, we remained profitable and are reporting an operating profit of EUR135 million," Chief Executive Officer Willie Walsh said.
Looking ahead, IAG, which also own airlines Vueling and Level, said it expects 2019 operating profit to be in line with 2018, when considered in terms of current fuel prices and exchange rates. Last year, IAG's operating profit was EUR3.68 billion.
The company expects passenger unit revenue to be flat and non-fuel unit cost to improve.
In April, IAG's traffic, measured in revenue passenger kilometres, increased by 7.7% to EUR23.4 million, versus the same month a year ago, while capacity rose 5.8% to 28.1 billion available seats.
During the month of April, IAG carried 9.9 million passengers, up from 9.2 million a year ago. In the year to date, reported passenger numbers were up 6.5% to 34.24 million from 32.1 million in 2018.
Load factor - the number of passengers as a proportion of seats available - increased to 83.4% in April, compared to 81.9% a year prior. In the year-to-date, load factor improved marginally to 81.4% from 80.9%.
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