International Airlines Group (IAG) has announced a huge jump in profits.
The owner of British Airways (BA) revealed that its pre-tax profits for 2014 had risen to €828 million (£601 million) with operating doubling to over €1 billion. Following the announcement, IAG has confirmed that it has raised its outlook for the year by 20 per cent. The company said that it had been boosted by lower fuel prices in the fourth quarter and more efficient aircraft.
Alongside BA, IAG also owns Spanish airlines Iberia and Vueling and the company was quick to highlight the strong performance of these subsidiaries. Chief executive Willie Walsh described the recovery and turnaround of Iberia as "remarkable, both financially and operationally" and that he was "very proud of its achievement especially its strong cost discipline".
Mr Walsh explained that IAG's three airlines are facing increased competition both domestically and internationally. This is down to the rise in the amount of low-cost carriers coming into the market.
Commenting on its performance, IAG stated: "Iberia made an operating profit of €50m compared to an operating loss of €166m last year.
"The airline's turnaround had been remarkable, both financially and operationally, and we're very proud of its achievement especially its strong cost discipline. In 2013 we said our intention was for Iberia to break-even in 2014 and it has fulfilled that promise."
Aer Lingus offer
IAG has been looking to purchase Irish airline Aer Lingus with a series of bids in the past month. The BA owner lodged a bid of €1.36 billion in late January which is being considered by the carrier. IAG needs to gain the approval of both the Irish government and Ryanair which hold a 25.1 per cent and 29.8 per cent stake respectively.
The takeover surrounds gaining more slots at Heathrow Airport. Aer Lingus currently has 23 pairs of take-off and landing slots at the airport, only Lufthansa, BA and Virgin Atlantic boast more.
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