British Airways Owner Announces Slight Profit Rise
IAG, which owns British Airways and Spanish carrier Iberia, said Friday that full-year net profit gained only slightly, as restructuring costs offset benefits from the demise of smaller rivals.
Profit after tax grew 3.6 percent to 2.0 billion euros ($2.5 billion) in 2017 from a year earlier, the owner also of Irish airline Aer Lingus and Spanish carrier Vueling said in an earnings statement.
The group suffered an exceptional restructuring charge of 288 million euros last year, while passenger numbers rose four percent to almost 105 million.
Stripping out one-off items, IAG said operating profit jumped 19 percent to 3.0 billion euros -- a level that however failed to match market expectations, sending the company's share price sliding 5.0 percent on Friday.
"In the bigger scheme of things, the earnings miss was only minor and the business remains confident about its prospects, as reflected by guidance for 2018 operating profit," noted Investment Director Russ Mould at AJ Bell.
Looking ahead, IAG said the company "expects its operating profit for 2018 to show an increase year-on-year."
Last year was a bruising year for some European airlines after the collapse of Air Berlin and Monarch Airlines but such failures provided opportunities for the likes of IAG to gain more passengers.
"All our airlines performed extremely well (in 2017) with their best-ever individual financial results, strong operational performances and commitment to customer service," group chief executive Willie Walsh said in the earnings statement.