The owner of British Airways and Aer Lingus, International Airlines Group (IAG), has reported a significant increase in earnings due to higher sales and reduced fuel costs.
The group is experiencing a resurgence in leisure travel. IAG reported an operating profit of 68 million euro (£58.5million) for the first quarter of the year, a substantial increase from the nine million euro (£7.7million) reported during the same period last year.
Total revenues also saw a boost, rising to 6.4 billion euro (£5.5billion) from 5.9 billion euro (£5.1billion) last year. The improved profits and sales have been attributed to stronger demand across all its airlines, which also include Iberia and Vueling.
The company noted a particular increase in demand for travel between major European cities, especially for leisure purposes, while business travel has been slower to recover. However, conflicts in the Middle East have impacted flights to the region by most of its airlines.
Fuel costs were approximately 5% lower than the previous year, thanks to lower average prices and more efficient aircraft deliveries, according to IAG. Despite this, the company spent more on operations in the latest quarter due to an increased volume of flights. Employee costs also rose by over 14% year on year, as a result of wage increases and the hiring of additional staff for the busy summer schedule.
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Luis Gallego, Chief Executive of IAG, said "Our transformation initiatives and increased demand, including over the Easter holidays, have delivered another very good set of results with improvements to both revenue and operating profit."
"Our group benefits from the strength of our core markets North Atlantic, South Atlantic and intra-Europe and the performance of our brands. We are well-positioned for the summer. The high demand for travel is a continuing trend."
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