Full Year 2024 International Consolidated Airlines Group SA Earnings Call Transcript
Key Points
- International Consolidated Airlines Group SA (BABWF) reported a 27% increase in operating profits, reaching EUR4.4 billion.
- The company achieved a 13.8% operating margin, which is considered industry-leading.
- Free cash flow generation was strong at EUR3.6 billion after investing EUR2.8 billion in the business.
- The company announced a share buyback program of EUR350 million and plans to return up to EUR1 billion of excess capital to shareholders.
- IAG Loyalty continues to deliver high double-digit margins and asset-light earnings growth, becoming the third-largest operating company by profit within the group.
- Aer Lingus faced significant industrial action and strong competition at its Dublin hub, impacting its financial performance.
- The company experienced a larger-than-expected negative FX impact in Q4, affecting non-fuel unit costs.
- There is a requirement to pay EUR557 million of VAT to HMRC, pending the outcome of a legal appeal.
- CapEx is expected to increase to around EUR3.7 billion in 2025, which may impact free cash flow generation.
- The Trent 1000 engine issues required capacity adjustments at British Airways, affecting operational efficiency.
Good morning, ladies and gentlemen, and welcome to International Airlines Group full-year 2024 results. (Operator Instructions) I would like to remind all participants that this call is being recorded.
I will now hand over to Luis Gallego, Chief Executive Officer, to open the presentation. Please go ahead.
Good morning, everyone, and welcome to our full-year 2024 results. As usual, I am here with Nicholas Cadbury, our Chief Financial and Sustainability Officer, as well as other members of the IAG Management Committee. I am going to start today by reminding you of the key elements of our investment case.
Our fundamentals are very strong. We have a unique, strong core proposition. We have the best network in the world and the best hubs. Our brands in those hubs are incredibly strong, think Iberia in Madrid or Aer Lingus in Dublin. Our customer base is highly attractive, think BA in London. And we have propositions that bring together
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