British Airways owner set to defy recession concerns with soaring sales
International Airlines Group (IAG), which also owns airlines Iberia, Vueling and Aer Lingus, will publish its financial results for 2023 on Thursday.
Your support helps us to tell the story
This election is still a dead heat, according to most polls. In a fight with such wafer-thin margins, we need reporters on the ground talking to the people Trump and Harris are courting. Your support allows us to keep sending journalists to the story.
The Independent is trusted by 27 million Americans from across the entire political spectrum every month. Unlike many other quality news outlets, we choose not to lock you out of our reporting and analysis with paywalls. But quality journalism must still be paid for.
Help us keep bring these critical stories to light. Your support makes all the difference.
The owner of British Airways is set to report soaring sales last year, shrugging off fears that the UK’s recent recession has dented demand for holidays.
International Airlines Group (IAG), which also owns airlines Iberia, Vueling and Aer Lingus, will publish its financial results for 2023 on Thursday.
The aviation giant is expected to report sales totalling just shy of 30 billion euros (£25 billion), a record yearly amount for the group and more than a quarter higher than the prior year.
It follows IAG reporting record profits between July and September last year, the critical summer season, as it benefited from a boom in leisure travel.
The company flagged particularly strong demand for flights on its North and South Atlantic routes and top holiday destinations in Europe.
Analysts are expecting an underlying operating profit for the full year of about 3.5 billion euros (£3 billion), which would top its previous peak achieved in 2018.
A group of analysts at AJ Bell said the bumper profits could come despite IAG being “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 (passengers and cargo) can be to the economic cycle”.
Official figures showed that the UK fell into a technical recession at the end of the year, which is defined as two consecutive quarters of negative economic growth.
But major travel groups including Jet2 and Tui have noted in recent months that consumers have been prioritising hard-earned trips abroad despite seeing their incomes squeezed by the cost-of-living crisis.
Investors could be looking for similar reassurances from IAG, particularly that their bookings are holding strong against lower-cost rivals like easyJet, Ryanair, and Wizz Air.
AJ Bell’s experts also pointed out that higher oil prices and staff costs are also potential concerns, as well as airlines increasing capacity on their flights, leading to greater competition along popular routes.