European airline IAG concluded with another profitable quarter in 2024 as British Airways and Iberia owners continue to see positive returns from all business units.
Reporting its fourth quarter and full year results on February 28, IAG won a strong year for business, saying its operating profit for October-December was 961 million euros ($1 billion) at 49% ahead of analysts' forecasts.
“This is not a peak, it's the beginning of a more sustainable level of profit,” CEO Lewis Gallego said in a revenue call.
He cites the strong position of IAG in its hub, particularly the performance of the transatlantic and European internal markets, and the continued transformational effort as a key factor behind recent performance, as well as the group's optimism about the potential revenues from 2025 onwards.
In fact, IAG's full-year operating profit margin of 13.8% and return on capital of 17.3% will be “exceptional performance for any business,” Gallego says.
As a result, AER Lingus achieved an operating margin of 8.6% despite the impact of the 2024 strike action, while BA achieved a margin of 14.2%, Iberia 13.6%, 12.3% and IAG loyalty 17.3%.
IAG saw its full-year net profit increased to just 2.7 billion euros ($2.8 billion), while operating profit rose 27% to 4.4 billion euros. These figures on revenue rose by around 9% to around 32.1 billion euros.
The 3.1% increase in passenger unit revenues exceeded a 0.3% increase in unit costs (or 2.6% increase if fuel is excluded).
IAG's fourth quarter operating profit doubled year-on-year to 961 million euros, while revenues increased 11% to 8 billion euros. However, net profit fell 22% to 392 million euros.
