Walsh's airline group orders 16 jets as profits soar
Published 02/08/2014 | 02:30
WILLIE Walsh's International Airlines Group (IAG) ordered 16 wide-body jets for its Iberia business as it reported a 55pc rise in second-quarter profit.
Shares in the British Airways owner rose as much as 4.9pc when trading opened in London yesterday after it was revealed the Spanish arm of the group is on track to return a full year profit for the first time since 2008.
Iberia will get eight A350-900s and eight A330-200s from Airbus to replace 16 aging A340s, IAG said. The aircraft are worth about $4bn (€3bn).
"Iberia has taken significant steps to restructure its business and the progress made so far means that we can bring new long-haul aircraft into the airline's fleet," said Mr Walsh, who is chief executive.
IAG, Europe's second-largest airline by market value, stuck to its annual profit target, unlike rival former state-owned carriers Lufthansa and Air France-KLM which have both issued profit warnings in recent weeks.
The airline chief aims to lift annual earnings by at least €500m beyond last year's €770m, and wants a profit of €1.8bn by 2015. Quarterly results showed an operating profit of €380m before one-time cost.
About 3,000 jobs have been cut at Iberia and IAG scrapped its worst-performing operations, while adding capacity at British Airways.
The Spanish airline made an operating profit of €16m, compared to a €35m loss a year earlier, IAG said, while British Airways earnings climbed 34pc to €332m in the quarter.