British Airways owner IAG posts record profits - BBC
Jul 28, 2023, 3:55 am
#1
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British Airways owner IAG posts record profits - BBC
From the BBC. Hope I did not miss this posted elsewhere.
https://www.bbc.co.uk/news/business-66335208
The owner of British Airways has posted record half-year profits helped by higher fares and the continued rebound in travel post-pandemic.
Airline group IAG reported operating profits of €1.3bn (£1.1bn) after being boosted by a "strong" recovery in leisure travel.
In the same period last year it had posted a loss of €446m.
IAG chief Luis Gallego said the group was aiming to be back at pre-pandemic levels of demand by the end of year.
However, the company - which also owns Iberia, Aer Lingus and Vueling - said that while there was no sign of weakness in forward bookings at the moment, it was "mindful of wider uncertainties" that could affect fuel prices and consumer confidence in the months ahead.
IAG said flight capacity was back to 94% of pre-pandemic levels in the first half of the year.
Fares were up by about 9.5% on average, and revenue reached €13.6bn - an increase of nearly 45% from a year earlier.
Airline group IAG reported operating profits of €1.3bn (£1.1bn) after being boosted by a "strong" recovery in leisure travel.
In the same period last year it had posted a loss of €446m.
IAG chief Luis Gallego said the group was aiming to be back at pre-pandemic levels of demand by the end of year.
However, the company - which also owns Iberia, Aer Lingus and Vueling - said that while there was no sign of weakness in forward bookings at the moment, it was "mindful of wider uncertainties" that could affect fuel prices and consumer confidence in the months ahead.
IAG said flight capacity was back to 94% of pre-pandemic levels in the first half of the year.
Fares were up by about 9.5% on average, and revenue reached €13.6bn - an increase of nearly 45% from a year earlier.
Jul 28, 2023, 4:19 am
#4
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I’m some ways fares have now reached more sustainable levels. Labour costs have risen and,in my view, quite rightly given the cuts during the pandemic and the realisation that certain groups in aviation are not going to accept very low salaries.
I see the strikes at Gatwick are not going ahead as the result of improved offers. I always thought this would be the case because the case for improved rates was strong and could be afforded.
I see the strikes at Gatwick are not going ahead as the result of improved offers. I always thought this would be the case because the case for improved rates was strong and could be afforded.
Last edited by vectismanpaul; Jul 28, 2023 at 5:18 am
Jul 28, 2023, 4:48 am
#5
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They didn't go bust which is good news considering. 
As for fares, I've been looking at the cost of a no nonsense CW return ticket from EZE-GLA for later in the year and had no problem finding tickets around the US$4300 mark. Which I think is pretty reasonable.
As for fares, I've been looking at the cost of a no nonsense CW return ticket from EZE-GLA for later in the year and had no problem finding tickets around the US$4300 mark. Which I think is pretty reasonable.
Jul 28, 2023, 5:17 am
#7
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British Airways owner IAG commits to investing record £1.1bn profit (cityam.com)
IAG acknowledged that “some of our operations are not where we would want them to be and this is affecting our overall customer service”.
Jul 28, 2023, 6:23 am
#9
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I do struggle with the idea that the company can state honestly
"while there was no sign of weakness in forward bookings at the moment"
Given their exposure to the US market and the expense of going there for many Brits this seems odd. Friends cam back from Vegas recently and reported lots of empty seats as well as bemoaning the extraordinary expense of being there. Virgin are offering 30% reduction on all points bookings.
Perhaps the forward booking horizon is quite short.
"while there was no sign of weakness in forward bookings at the moment"
Given their exposure to the US market and the expense of going there for many Brits this seems odd. Friends cam back from Vegas recently and reported lots of empty seats as well as bemoaning the extraordinary expense of being there. Virgin are offering 30% reduction on all points bookings.
Perhaps the forward booking horizon is quite short.
Jul 28, 2023, 6:31 am
#10
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Remind me, how much did we UK taxpayers pay to bail the company out during the pandemic?
It would be nice now they're in the money if they returned the favour, either by paying it back, improving the service, or paying their staff a decent wage.
It would be nice now they're in the money if they returned the favour, either by paying it back, improving the service, or paying their staff a decent wage.
Last edited by ScruttonStreet; Jul 28, 2023 at 6:52 am
Jul 28, 2023, 6:57 am
#11
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As far as I'm aware, a part from furlough pay, like all UK companies where entitled to, and a Government secured loan which has/had to be repaid, they received no free money from the UK taxpayer...
Jul 28, 2023, 6:58 am
#12
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I do struggle with the idea that the company can state honestly
"while there was no sign of weakness in forward bookings at the moment"
Given their exposure to the US market and the expense of going there for many Brits this seems odd. Friends cam back from Vegas recently and reported lots of empty seats as well as bemoaning the extraordinary expense of being there. Virgin are offering 30% reduction on all points bookings.
Perhaps the forward booking horizon is quite short.
"while there was no sign of weakness in forward bookings at the moment"
Given their exposure to the US market and the expense of going there for many Brits this seems odd. Friends cam back from Vegas recently and reported lots of empty seats as well as bemoaning the extraordinary expense of being there. Virgin are offering 30% reduction on all points bookings.
Perhaps the forward booking horizon is quite short.
Have flown BA twice to US west coast since then and were full on both and in both directions. It's quite possible VS load factors just aren't as good as BA.
Jul 28, 2023, 7:07 am
#13
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No, but elsewhere I read BA is committing to invest these profits back into the business to improve the quality of the service, which is good news.
British Airways owner IAG commits to investing record £1.1bn profit (cityam.com)
IAG acknowledged that “some of our operations are not where we would want them to be and this is affecting our overall customer service”.
British Airways owner IAG commits to investing record £1.1bn profit (cityam.com)
IAG acknowledged that “some of our operations are not where we would want them to be and this is affecting our overall customer service”.
Given the strong leisure market (and de facto assumed weak business market), surely they would get an improved return in investing in a better product for leisure customers who typically arrive at the airport earlier, spend longer eating and drinking in the lounges and value a stronger service proposition onboard. Investing in the food and drink options in the airport (can we have the BA burger back in GF lounge please?) as well as staff training to improve the consistency with delivering the SOP's on board would have a huge impact on passenger satisfaction. This will all influence those all important repeat bookings.
Returning a ticketing function to the airport would be a huge game changer when IRROPS occur. And do something... anything... about boarding. It is just a mess for both SH and LH. At their hubs and out stations. I don't know the answer. I'm not sure I know the question. But at the moment, if you are in groups 1-5, rugby scrums are a more premium experience.
Assuming BA want to invest that is. Or are they just making up headlines? Come on Sean - show your metal.
Instead, we may see the other half of the tomato appear along with another flavour of slop for the CE dessert. A cup of tea in SH economy seems to be the limit of the ambition currently.
Jul 28, 2023, 7:20 am
#14
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The pandemic showed the benefit of a strong balance sheet. Ryanair were way out in front, BA were middling and Virgin were not so good. Most airlines should now be concentrating on improving their balance sheets by reducing their debt.
Full disclosure, I am a retired bean counter, but not in the airline industry.
Full disclosure, I am a retired bean counter, but not in the airline industry.
Jul 28, 2023, 8:31 am
#15
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