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Good times return as BA/Iberia owner claws back profit

March 4, 2014 Financial, Headline News No Comments Email Email

egtmedia59International Airlines Group (IAG), the owner of British Airways, Iberia and Spanish budget airline Vueling, has swung back into profit in 2013.

The group reported a profit of EUR 527 million (AUD 815 million) for full-year 2013, compared with losses of EUR 613 million (AUD 948 million)the previous year. 250x250

The group said that although Spanish carrier Iberia reported a loss, it made “huge progress” through restructuring. British Airways had benefited from extra Heathrow slots from the integration of BMI, it added.

“In 2013, we strengthened the group by acquiring Vueling, embarking on Iberia’s transformation and enhancing British Airways’ revenue performance,” group chief executive Willie Walsh said.

“This has led to a strong financial recovery and return to profitability, with a turnaround of nearly 800 million euros.”

In a BBC interview, Walsh said he was unconcerned about the implications for British Airways if Scots were to vote for independence from the UK.

“If anything, it [Scottish independence] will be slightly positive, since we believe it will abolish air passenger duty,” he told the BBC. Expanding on this, in comments to the Guardian, Walsh (an Irishman) said he considered people in the north of England would “just drive across the border” to Scotland to avoid the UK’s air passenger duty (departure tax).

Scotland’s referendum on independence will be held on 18 September 2014, with latest polls tipping that it will probably vote to remain in the UK.

Iberia had “made huge progress” under the restructuring plan, Walsh told the BBC.

“Recent pay and productivity agreements between Iberia and its pilot and cabin crew unions are key to reducing the airline’s costs further and providing the foundation for profitable growth.”

Written by : Peter Needham

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