BA merger company profits take off

4.00

British Airways and merger partner Iberia posted combined half-year profits of 39 million euros (£34.2 million) today, despite a 35% jump in fuel costs.

International Airlines Group, which was formed in January, has benefited from improved demand on long haul routes, particularly for premium seats, as well as ongoing cost cutting measures.



Its fuel bill surged to 2.44 billion euros (£2.1 billion) in the six months to June 30, of which only half was recovered through initiatives such as fuel surcharges.



The airline's profit in the six months compared with a loss of 419 million euros racked up by the two airlines a year earlier.



Former BA boss Willie Walsh, who is chief executive of the combined group, said he expected "significant growth" in profits across 2011, despite strong competition on short-haul routes. He also expects events in Japan, North Africa and the Middle East to knock profits by up to 100 million euros (£87.7 million).



He added: "Against a background of economic uncertainty, London remains a strong market."



BA and Spain's Iberia have retained their brands in the merger, which is expected to save 400 million euro (£351 million) a year by its fifth year.



It is now the third largest scheduled airline group in Europe and the sixth largest in the world, based on revenues. The pair fly to more than 200 destinations on more than 400 aircraft and last year carried 55 million passengers.



IAG plans to expand aggressively and has reportedly drawn up a list of 12 other airlines it will consider buying.



Mr Walsh said the airline had already made savings through joint procurement in areas such as insurance and airport handling.



"Customers are also directly benefiting through airline website cross-selling, more fare and schedule choice on overlapping long haul routes and easier access to more destinations via new codeshares," he added.



Passenger revenues rose nearly 19% to 6.45 billion euros (£5.66 billion) in the half-year but IAG said it was evaluating some reduction in capacity growth for the winter.









Analysts said the results from IAG were better than expected.



Keith Bowman, equity analyst at Hargreaves Lansdown stockbrokers, said: "Wealthy and business customers are playing their part, while management is busy concentrating on cost synergies and removing controllable non-fuel related expenses.



"However, the challenges remain numerous. Fuel costs are still elevated, acts of terrorism have raised the cost of security, whilst geopolitical tensions and upheaval in the Middle East provide uncertainty over safety and passengers' desire to travel."

PROMOTED VIDEO
Arts and Entertainment
booksPhotographer Richard Young has been snapping celebrities at play for 40 years - but he says it wasn’t all fun and games...
News
i100
Sport
Aguero - who single-handedly has kept City's Champions League dreams alive - celebrates his dramatic late winner
footballManchester City 3 Bayern Munich 2: Argentine's late hat-rick sees home side snatch vital victory
News
Muhammad Ali pictured in better health in 2006
peopleBut he has enjoyed publicity from his alleged near-death experience
Arts and Entertainment
Tony breaks into Ian Garrett's yacht and makes a shocking discovery
TVReview: Revelations continue to make this drama a tough watch
News
news
News
ebooksNow available in paperback
News
peopleSinger tells The Independent what life is like in rehab in an exclusive video interview
News
The assumption that women are not as competent in leadership positions as men are leads to increased stress in the workplace
science... and it's down to gender stereotypes
Arts and Entertainment
Inner sanctum: Tove Jansson and friends in her studio in 1992
booksWhat was the inspiration for Finland's most famous family?
News
i100
Arts and Entertainment
Singer songwriter Bob Dylan performs on stage
films
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Citifocus Ltd: Product Development - Asset Management

£Attractive: Citifocus Ltd: High calibre individual with significant product d...

Citifocus Ltd: Credit Ratings - Banking Sector

£Negotiable: Citifocus Ltd: Leading global bank seeks experienced credit analy...

Citifocus Ltd: Economic Crime Investigation & Analysis

£Attractive Package: Citifocus Ltd: High calibre individual with a high degree...

Citifocus Ltd: Snr Risk Analyst - Capital & Liquidity

£Attractive: Citifocus Ltd: High calibre individual with superior academics an...

Day In a Page

Homeless Veterans Christmas Appeal: Drifting and forgotten - turning lives around for ex-soldiers

Homeless Veterans Christmas Appeal: Turning lives around for ex-soldiers

Our partner charities help veterans on the brink – and get them back on their feet
Putin’s far-right ambition: Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU

Putin’s far-right ambition

Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU
Tove Jansson's Moominland: What was the inspiration for Finland's most famous family?

Escape to Moominland

What was the inspiration for Finland's most famous family?
Nightclubbing with Richard Young: The story behind his latest book of celebrity photographs

24-Hour party person

Photographer Richard Young has been snapping celebrities at play for 40 years. As his latest book is released, he reveals that it wasn’t all fun and games
Michelle Obama's school dinners: America’s children have a message for the First Lady

A taste for rebellion

US children have started an online protest against Michelle Obama’s drive for healthy school meals by posting photos of their lunches
Colouring books for adults: How the French are going crazy for Crayolas

Colouring books for adults

How the French are going crazy for Crayolas
Jack Thorne's play 'Hope': What would you do as a local politician faced with an impossible choice of cuts?

What would you do as a local politician faced with an impossible choice of cuts?

Playwright Jack Thorne's latest work 'Hope' poses the question to audiences
Ed Harcourt on Romeo Beckham and life as a court composer at Burberry

Call me Ed Mozart

Paloma Faith, Lana del Ray... Romeo Beckham. Ed Harcourt has proved that he can write for them all. But it took a personal crisis to turn him from indie star to writer-for-hire
10 best stocking fillers for foodies

Festive treats: 10 best stocking fillers for foodies

From boozy milk to wasabi, give the food-lover in your life some extra-special, unusual treats to wake up to on Christmas morning
Phil Hughes head injury: He had one weakness – it has come back to haunt him

Phil Hughes had one weakness – it has come back to haunt him

Prolific opener had world at his feet until Harmison and Flintoff bounced him
'I have an age of attraction that starts as low as four': How do you deal with a paedophile who has never committed a crime?

'I am a paedophile'

Is our approach to sex offenders helping to create more victims?
How bad do you have to be to lose a Home Office contract?

How bad do you have to be to lose a Home Office contract?

Serco given Yarl’s Wood immigration contract despite ‘vast failings’
Green Party on the march in Bristol: From a lost deposit to victory

From a lost deposit to victory

Green Party on the march in Bristol
Putting the grot right into Santa's grotto

Winter blunderlands

Putting the grot into grotto
'It just came to us, why not do it naked?' London's first nude free runner captured in breathtaking images across capital

'It just came to us, why not do it naked?'

London's first nude free runner captured in breathtaking images across capital