The International Consolidated Airlines Grp SA (LON: IAG) share price rose 3.48% after releasing its interim half-year results for the six months to 30 June 2023. The British Airways owner generated a record half-year operating profit before exceptional items of €1.260 billion compared to the €446 million loss in H1 2022.Â
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The higher profits were driven by increased demand across the group’s airlines, especially its Spanish businesses. The company reached 94% of the 2019 pre-covid passenger capacity as measured in available seat kilometres (ASKs).
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The airline group revealed that passenger unit revenue for the first six months was 18.4% higher than during the same period in 2022. The company attributed the higher figures to robust leisure traffic recovery even as business traffic recovered much slower. The premium leisure division led in performance.
Customer demand remains strong across the Group, particularly for leisure customers, with around 80% of the third quarter's passenger revenue already booked. The company expects full-year 2023 capacity to be around 97% of pre-COVID-19 levels, subject to disruption.
Non-fuel unit costs fell by 7.3% compared to the first half of 2022, driven by a 30.9% increase in passenger capacity. Operating margin before exceptional items was 9.3% for the first half and 16.3% for the second quarter.
Fuel unit costs rose 5.7% compared to 2022 due to the higher effective average fuel prices, net of hedging in the first six months of 2023 versus 2022.
Luis Gallego, International Airlines Group's CEO, said: “Our strong profits since the start of the year are helping to fund investment for our customers and to improve our balance sheet by reducing debt.  We are aiming to be back to pre-pandemic capacity at the end of this year.  These results are thanks to a strong performance from all companies across the Group, and we would like to thank our teams for their hard work during the year so far. Customer demand remains strong across the Group, particularly for leisure travel, with around 80% of passenger revenue for the third quarter already booked.
*This is not investment advice.
The IAG share price.
The IAG (LON: IAG) share price rose 3.48% to trade at 160.07p, from Thursday’s closing price of 154.68p.
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