Strong start to 2025 for IAG, outlook unchanged
IAG reports strong Q1 2025 results, maintains full-year outlook, and orders 53 widebody aircraft to enhance long-haul fleet efficiency.
IAG announced 2025 first quarter results and the outloook for the whole year. Also, the Group is ordering 53 new Airbus and Boeing aircraft for its long-haul fleet, comprising 32 Boeing 787-10 aircraft for British Airways and 21 Airbus A330-900neo aircraft, which can be deployed within Aer Lingus, Iberia or LEVEL.
Luis Gallego, IAG Chief Executive Officer, said: 'Our strong first quarter results reflect the performance of our businesses and the effectiveness of our strategy and transformation. We continue to deliver on our industry-leading financial targets. We remain focused on strengthening our broad portfolio of market-leading brands across our core markets of the North Atlantic,
Latin America and intra-Europe.
'We continue to see resilient demand for air travel across all our markets, particularly in the premium cabins and despite the macroeconomic uncertainty. Our commitment to financial strength and shareholder value is reflected in 530 million euros of share buybacks completed in 2025 so far, alongside a proposed final dividend of 288 million euros, which brings our total dividend for 2024 to 435 million euros.'
Highlights
Revenue growth of 9.6%, reflecting the strength of our business
Operating profit before exceptional items increased by 130 million euros to 198 million euros as strong revenue growth and a lower fuel price offset expected cost increases. Operating margin increased by 1.7 pts to 2.8%
Good operational performance, particularly at British Airways. Iberia and Vueling continue to be amongst the most punctual airlines in the world
Ordered 71 widebody aircraft to support long-term strategy
Stronger balance sheet driven by free cash flow and disciplined capital allocation: net leverage at 0.9x and gross debt reduced by 1,859 million euros compared to 31 December 2024
Delivering for our shareholders through a sustainable dividend and up to €1 billion share buyback
Outlook for 2025
Trading
Whilst being mindful of the geopolitical and macroeconomic uncertainty, our outlook for the full year is unchanged
We are continuing to see good demand for air travel across our core markets and for our brands, highlighting the strength of our
portfolio
portfolio Latin America and Europe continue to be strong and the North Atlantic demand has been robust, with strength in our premium cabin mitigating some recent softness in US point-of-sale economy leisure
As of 6 May we are around 80% booked for the second quarter, with revenue ahead of last year, and 29% booked for the secondhalf, broadly in line with last year
Modelling assumptions
Capacity increase of c.3% is unchanged. We continue to review our plans for the winter season and 2026
Non-fuel unit costs are assumed to increase by around 4% in 2025 including the adverse impact of foreign exchange, weighted to the first half of the year, as previously guided at our Full Year 2024 results
Capital expenditure for the year is expected to be around €3.7 billion
Total fuel cost is expected to be €7.5 billion (based on jet fuel forward curve and foreign exchange rates at the end of Q1) as the Group benefits from recent falls in the price of oil
IAG orders 53 new Airbus and Boeing aircraft for its long-haul fleet
International Airlines Group (IAG) is ordering 53 new Airbus and Boeing aircraft for its long-haul fleet, comprising 32 Boeing 787-10 aircraft for British Airways and 21 Airbus A330-900neo aircraft, which can be deployed within Aer Lingus, Iberia or LEVEL.
Subject to shareholder approval at the IAG's Annual General Meeting in June, these new aircraft will enable IAG's airlines to grow and replace their long-haul fleets with modern, fuel-efficient planes. The aircraft will be delivered between 2028 and 2033.
In addition, the order with Boeing grants British Airways the rights to elect to purchase 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. As well as the replacements above, the new orders would also allow 18 aircraft for growth in IAG's core markets.
The Airbus A330-900neo aircraft will be powered by Rolls-Royce engines. British Airways' Boeing 787-10 aircraft will be powered by General Electric engines. Both engine orders include comprehensive warranty and maintenance packages with Rolls-Royce and General Electric, respectively.
These new orders follow orders already placed in March this year, and announced today, for six Airbus A350-900s for Iberia, as well as six Airbus A350-1000s and six Boeing 777-9s for British Airways.
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.'
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