BA-owner IAG returns to profit after COVID-19 slump

British Airways-owner IAG on Friday returned to profit for the first time since the outbreak of the COVID-19 pandemic in the April-June period, led by demand for flights in Spain and to Latin America.

British Airways-owner IAG on Friday returned to profit for the first time since the outbreak of the COVID-19 pandemic in the April-June period, led by demand for flights in Spain and to Latin America. IAG posted an operating profit for the second quarter of 293 million euros ($299.56 million), compared with an operating loss of 967 million euros in the same period of 2021.

"This result supports our outlook for a full year operating profit," Chief Executive Luis Gallego said. The company, which also owns Iberia and Aer Lingus, said its passenger capacity had hit 78% of 2019 levels in the second quarter of the year, and it expects that to grow steadily through 2022.

IAG forecast passenger capacity of around 80% in the third quarter, and around 85% in the fourth. That, however, marks a reduction of 5% for the second half of the year due to disruption at Heathrow for BA. The company had targeted a return to profitability in May. However, since then BA like other airlines has been hit by cancellations and delays at several airports.

European aviation has struggled to cope with the rapid rebound in travel following two years of a pandemic, with huge queues building at many airports due to a shortage of staff, prompting last-minute cancellations and angry scenes. However, a move to limit flight numbers by the industry appears to have stabilized the situation. London's Heathrow and lower-cost airlines such as EasyJet and Wizz Air have all reported improving operations.

"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," Gallego said. Despite the pressure, some airlines are returning to growth. Air France-KLM beat quarterly expectations as it's core and net incomes turned to profits on Friday.

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