As previously mentioned, International Airlines Group published its 1st quarter results in Friday. On the morning of the announcement, as per standard protocol, it held a webcast for analyst and the question and answer session that follows provides a lot of useful insight into current strategic developments at the airline group.
Here is a summary of some points of interest from the call:
International Airlines Group (IAG) has just published its financial results for the first quarter of the year. Once again, the results are a tale of two airlines with a stark divergence in the performance of British Airways and Iberia. IAG made an overall operating loss of €278 million. However, IAG had to also take another exceptional charge of €311 million in connection with the restructuring of Iberia. This is in addition to the exceptional charges and provisions IAG took at the end of 2012. The overall loss after tax for the quarter was €630 million.
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The offer by International Airlines Group to acquire the 54% of Vueling’s shares that it does not already own expired on Friday 19 April. The airline group initially made an offer priced at €7.00 per share which Vueling management chose not to recommend. IAG subsequently increased its offer to €9.25 per share. However, the minimum acceptance level was reduced to just 4.16% of Vueling’s capital to leave IAG with at least overall control of Vueling, if not 100% ownership.
Assuming the transaction completes this will be the second airline acquired by IAG since its formation in 2011 and the third member airline of the group (the first acquisition, bmi, being subsumed into British Airways).
So why is IAG so interested in Vueling and what does it have planned for the airline?
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International Airlines Group has just announced that it has ordered 18 Airbus A350-1000 aircraft for British Airways for delivery between 2017 and 2023 and has secured a further 18 options. The group has also secured delivery slots for Iberia, in anticipation of a future order for Iberia, subject to a satisfactory restructuring of the airline.
This follows the recent exercise of 18 Boeing 787 options for BA and acquisition of 787 delivery slots for Iberia and both airlines are moving towards a common long-haul fleet.
Whilst this is not the first long-haul order for Airbus by either BA or IAG, for Airbus this is still a significant long-haul order by BA as the A350 aircraft is likely to form a major part of BA’s long haul fleet as a replacement for the Boeing 747-400.
Full details are on the IAG website.
Here are a few new & noteworthy items for today, Sunday 21 April:
Continue reading “New & Noteworthy: Lufthansa, Qantas, Iberia, Israel Open Skies, Alitalia”
British Airways has this evening confirmed that it has converted 18 of its 28 options for Boeing 787 aircraft into firm orders for delivery between 2017 and 2021. The airline currently has 24 Boeing 787 aircraft on order for delivery from this year and this takes the total number of 787s to be delivered to BA to 42, meaning that the 787 will represent a substantial part of BA’s long-haul fleet. This is a clear vote of confidence by BA in the 787.
Continue reading “British Airways converts 18 Boeing 787 aircraft options into firm orders”