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British Airways owner expecting record year on post-pandemic boom

Published 23/02/2024, 12:18
Updated 23/02/2024, 12:41
© Reuters.  British Airways owner expecting record year on post-pandemic boom

Proactive Investors - British Airways owner International Consolidated Airlines Group (LON:ICAG) will offer up full-year results on Thursday, 29 February.

Given budget rivals easyJet (LON:EZJ), Ryanair (LON:0RYA) and Wizz Air (LON:WIZZ) have enjoyed recent gains on a faster post-pandemic recovery within the short-haul sector, the update will offer an insight into how premium, longer-distance carriers are faring in comparison.

“It is tempting to think that investors are frightened that IAG is losing out in the market share stakes to the low-cost carriers, at least in short-haul,” AJ Bell analysts noted.

“The company has also been dogged by labour unrest and geopolitical uncertainty, while the UK’s gradual slide into recession may not have helped sentiment either, given how sensitive airline travel can be to the economic cycle.”

That said, analysts still expect the company to have enjoyed a record year after passengers returned en masse for holidays, which were previously made impossible by Covid-19.

Total sales for 2023 are expected to hit a record €29.4 billion, marking a 27% year-on-year increase, AJ Bell said.

‌Underlying operating profit is anticipated to reach a record €3.5 billion meanwhile, exceeding the previous peak in 2018.

Investors will be keen to hear updates on capacity and load factors for both 2023 and the year ahead, AJ Bell added.

Capacity had sat at 87% of pre-pandemic levels by late 2022, with load factors having come in at 81.8%.

Costs, such as fuel, and revenue per seat will also be of interest, analysts noted.

IAG shares have fallen 8.5% over the year and sat at 153.35p on Thursday.

Read more on Proactive Investors UK

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