British Airways’ parent company IAG returns to profit between April and June

Despite cancelling tens of thousands of flights over the summer, British Airways and its sister airlines are back in profit.

IAG, which includes Aer Lingus of Ireland, and Iberia and Vueling of Spain, as well as BA, made an operating profit for the second quarter of 2022 of €293m (£250m), compared with a loss of €967m a year earlier.

But because of heavy losses between January and March, the half-year saw an operating loss of €438m.

“Customer demand continues to recover strongly,” the company says.

In line with rising demand, fares are 10.6 per cent higher than in 2019.

The surge in prices helped to offset the rising price of fuel – which began the year 37 per cent higher than in the first half of 2021, and by the end of June was 142 per cent higher.

The load factor (the proportion of seats filled) across IAG was 81.8 per cent between April and June, 3.2 per cent lower than in 2019.

By the end of June, says IAG, “premium leisure revenue had almost fully recovered to 2019’s level, despite capacity being significantly lower”.

But business travel is still only at 60 per cent of 2019.

British Airways and its passengers were affected by what IAG calls a “challenging operational environment at Heathrow”. From July to September, one in four seats will be cut compared with before the Covid pandemic. Iberia is operating some flights on behalf of BA from both Heathrow and Gatwick.

The IAG chief executive, Luis Gallego, said: “In the second quarter we returned to profit for the first time since the start of the pandemic following a strong recovery in demand across all our airlines.

“Premium leisure remains strong while business travel continues a steady recovery in all airlines.

“Iberia and Vueling were the best performing carriers within the group. The Spanish domestic market and routes to Latin America continued to lead the recovery with demand exceeding 2019 levels last month.

“Forward bookings show sustained strength and North Atlantic demand continues to grow following the lifting of the US Covid testing requirements in June.

“Our industry continues to face historic challenges due to the unprecedented scaling up in operations, especially in the UK where the operational challenges of Heathrow airport have been acute.

“Our airline teams remain focused on enhancing operational resilience and improving customer experience.

“I would like to thank those customers affected for their loyalty and patience and our colleagues for their hard work and commitment.

“We will continue working with the industry to address these issues as aviation emerges from its biggest crisis ever.”

The results statement says: “Ongoing labour shortages, threat of strike action and staff sickness from Covid infections have impacted the operational environment of the group’s airlines as well as the operations of the businesses on which the group relies.”