IAG Q3 profits hit by BA strike

IAG Q3 profits hit by BA strike

IAG Q3 profits hit by BA strike

International Airlines Group (LON:IAG) took a hit on Thursday after industrial action from pilots “heavily impacted” its third quarter.

Shares in the owner of British Airways were up during trading on Thursday.

Representing over 10,000 pilots, the British Airline Pilots’ Association (BALPA) went ahead with strikes in September and caused a large amount of flights to be cancelled.

International Airlines Group said on Thursday that the industrial action by the pilots, in addition to other disruption, impacted operating profit by €155 million during the quarter.

International Airlines Group, which recently announced that it would commit to achieving net zero carbon emissions by 2050, said that third quarter operating profit amounted to €1.4 billion.

International Airlines Group added that it expects 2019 operating profit before exceptional items to be €215 million lower than 2018.

“Passenger unit revenue is expected to be slightly down at constant currency and non-fuel unit costs are expected to improve at constant currency,” International Airlines Group added.

Indeed, at the end of September, the company reconsidered its guidance for the full year following the British Airways industrial action and the additional costs incurred.

“In quarter 3 we’re reporting an operating profit of €1,425 million before exceptional items, down from €1,530 million last year,” Willie Walsh, IAG Chief Executive Officer, said in a company statement.

“These are good underlying results. As we said in September, our performance has been affected by industrial action by pilots’ union BALPA and other disruption including threatened strikes by Heathrow airport employees,” the Chief Executive Officer continued.

“In addition, our fuel bill increased by €136 million during the quarter with fuel unit costs up 4.2 per cent at constant currency.”

The Chief Executive Officer said: “At constant currency, passenger unit revenue decreased by 1.1 per cent while non-fuel unit costs were up 1.1 per cent”.

Shares in International Airlines Group (LON:IAG) were trading at +1.00% as of 12:53 GMT.