31st Oct 2014 08:32
LONDON (Alliance News) - Shares in International Consolidated Airlines Group rose in early trade on Friday after it posted a rise in third quarter operating profit and revenue on a constant currency basis, with both British Airways and Iberia both performing well in the quarter.
Shares in the group were up 2.9% to 401.90 pence in early trade, making it the best performer in the FTSE 100.
Operating profit for the group in the third quarter to September 30 was EUR900 million, up on the EUR690 million a year earlier. British Airways made an operating profit of EUR607 million, up from EUR477 million a year earlier. Iberia's operating profit rose to EUR162 million from EUR74 million.
IAG Chief Executive Officer Willie Walsh said a statement that BA grew capacity in the quarter but retained a focus on cost controls. He said Iberia was boosted by cost cuts and the continued benefits of the restructuring of the business.
On a constant currency basis, revenue for the group rose 6.9%, but it was up 8.5% on a reported basis to EUR5.9 billion. Passenger unit revenue for the group was down 0.9% on a constant currency basis, with fuel unit costs falling 7.5%.
In its traffic report earlier this month, IAG said it saw strong growth in September, with high-margin premium traffic rising 7.6% year-on-year.
Operating profit for the first nine months of the year hit EUR1.1 billion, EUR473 million ahead of the year earlier, though the group said it has taken a EUR82 million charge on currency re-evaluation.
Revenue in the first nine months was up 7.4% to EUR15.2 billion from EUR14.1 billion a year earlier. Revenue passenger kilometres in the first nine months rose 9.5%.
For the full year, IAG said it expects operating profit in the range of EUR550 million to EUR600 million.
"We continued to grow capacity efficiently and both our non-fuel and fuel unit cost performances were strong with the latter boosted by the introduction of new, more efficient aircraft into our fleet," said Walsh.
By Sam Unsted; [email protected]; @SamUAtAlliance
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