British Airways parent company International Airlines Group (IAG) today said its first-half profits soared more than 55 per cent, helped by cost cuts at its Spanish carrier, Iberia.
The group, which was already ploughing ahead with plans to axe 3,100 jobs at Iberia, last week agreed further cuts with trade unions that could see a further 1,427 redundancies among pilots and ground staff.
Restructuring at Iberia, which is also cutting pay and capacity, helped the Spanish airline delivered an operating profit of €16 million (£12.7m) for the six months to the end of June, compared with a €35m loss a year ago.
Operating profits at BA surged by more than a third to €332m, helping overall earnings at IAG grow to €380m, up from €245m last year.
Chief executive Willie Walsh said: “This performance shows that we are making further solid progress. Our disciplined approach to capacity continues and we will make reductions where it makes sense as we go through the year.
“We are, therefore, trimming planned IAG capacity by around three percentage points for the winter 2014 season.”
Walsh said IAG expects its full-year operating profits to grow by “at least” €500m against the €770m figure it reported for 2013, while the latest round to job cuts at its Spanish airline “will create new opportunities for Iberia to enhance its profitability further in the next two or three years”.