British Airways (BA) is expected to reveal a jump in profit next week after more customers chose to take to the skies last year while oil prices slumped, cutting costs for the airline.
Its parent company, International Airlines Group (IAG) reports its annual results on Friday February 28, where it is expected to say profit surged by 15% to 4.1 billion euros (£3.4 billion).
The last year has been a strong one for the group, which reported strong demand for travel over the crucial summer period despite widespread flight delays during the period.
Analysts think sales grew by 8% to 31.7 billion euros (£26.3 billion) compared to the previous year.
At the same time, fuel has become cheaper amid falling oil prices globally – IAG previously said its fuel bill had fallen 4.2% before Christmas, partly owing to using more new, more fuel-efficient aeroplanes.
And load factor – a metric used to indicate how full flights are – was 89.9% at its last results before Christmas.
IAG also owns the Iberia, Vueling and Aer Lingus airlines.
Things may not all be plain sailing for IAG, however – with all eyes on chief Luis Gallego for some indication of how much demand there is likely to be this summer.
German travel operator Tui recently raised fears that the upcoming summer would be a tricky one for the industry, flagging slower growth in bookings.
And BA has also faced a backlash for changes to its loyalty programme, after switching from awarding points based on the distance flown or fare class to the amount spent, at a rate of one point for every pound.
The announcement of the changes in late December 2024 led to frequent flyer website headforpoints.com to accuse the airline of “effectively washing its hands of the leisure market”.
Michael Hewson, an analyst at MCH Market Insights, said there is “a possibility that some damage may have been done” to its relationship with its most loyal customers.
Nonetheless, shares in the company have doubled over the last 12 months, helped by “a resilient travel sector”, Mr Hewson added.
