- €530 million of share buybacks completed in 2025
- IAG orders 53 new Airbus and Boeing aircraft
- Shares up 60% over the past year
Shares in International Consolidated Airlines (IAG) gained over 1% to 294p in morning trading as the British Airways owner reported 9.6% rise in revenue for the three months to 31 March.
The company said it remained resilient in the first quarter despite macroeconomic uncertainty and is focused on strengthening its core markets of North Atlantic, Latin America and intra-Europe.
Operating profit before exceptional items increased by €130 million to €198 million as strong revenue growth and a lower fuel price offset expected cost increases.
IAG has kept its full year outlook unchanged whilst being ‘mindful’ of geopolitical uncertainty.
It was good news for shareholders as the company proposed a final dividend of €288 million, bringing the total dividend for 2024 to €435 million.
NEW AIRCRAFT
The airline group said it has ordered 53 new Airbus and Boeing aircraft for its long-haul fleet which will be deployed within Aer Lingus, Iberia or LEVEL.
The order with Boeing grants British Airways the rights to elect to buy up to 10 additional Boeing 787 aircraft and the order with Airbus grants IAG the rights to elect to purchase up to 13 additional Airbus A330-900neo aircraft.
Of the proposed 53 aircraft, 35 would serve to replace existing aircraft or, in the case of LEVEL, replace short-term leases.
WHAT DID THE CEO SAY?
Luis Gallego, IAG's CEO, said: ‘This order marks another milestone in our strategy and transformation programme and underlines our commitment to strengthening our airline brands and enhancing our customer proposition.
‘Looking ahead to the next decade, these new aircraft will enable us to strengthen our core markets and further improve our customer experience, while continuing to drive long-term value for our shareholders.’
FIRST QUARTER BEAT
Russ Mould, investment director at AJ Bell said: ‘The owner of British Airways has emerged as the mystery buyer of Boeing aircraft that seemingly helped to secure a sweet deal for Rolls-Royce to send aircraft engines to the US tariff-free.
‘Interestingly, IAG’s planes acquired from Boeing won’t feature Rolls-Royce engines, but they will be part of 21 Airbus aircraft that the UK airline operator is also buying as part of a bigger order to strengthen its long-haul fleet.
‘The news coincides with IAG’s first quarter results which beat expectations. Is this as good as it gets for the near-term? IAG faces the worrying prospect of a reduction in transatlantic travel as tariffs prompt European and Asian companies to look at ways to become less reliant on the US for trade, and a backlash against Trump makes the US less appealing to foreign tourists.
‘There are certainly signs of weakness, with softer booking for economy travel to the US. However, premium bookings appear to be holding up, which is a surprise.
‘One might have thought a lot of businesspeople might would be looking to postpone or cancel planned trips to the US. IAG and the market will be watching the booking trends closely, particularly around the all-important summer season.’
DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (Sabuhi Gard) and the editor (Martin Gamble) own shares in AJ Bell.
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