The owner of British Airways ran into turbulence yesterday as shares slumped despite better than expected profits and a ‘rebound’ in transatlantic travel.
Profits at International Airlines Group rose 26 per cent to £3.95billion for 2025 and it also vowed to return £1.3billion to investors, starting with a £440m buyback to be completed by the end of May.
Yet shares fell 7.4 per cent, or 33.6p, to 423.7p with analysts pointing to a lack of profit guidance and fears over potentially higher fuel prices as possible factors.
However, despite its fall yesterday, IAG’s shares are still up by a quarter over the past year.
Turbulence: Profits at BA owner International Airlines Group rose 26 per cent, but shares fell 7.4 per cent
It came as oil prices rose amid concerns of war in the Middle East, with Brent crude hitting $73 a barrel, a seven-month high.
Rival airlines were also down sharply with US carrier United off by 9 per cent, Delta sinking 7 per cent and American Airlines drifting 7 per cent lower. In Europe, Air France-KLM plunged 6.4 per cent and Wizz Air tumbled by 8.7 per cent.
One suggestion for the sell-off was that investors may have been anxious about comments from a White House official that he would take a ‘new interest’ in the industry after he and his wife experienced issues with American Airlines flights.
IAG’s results came after it had warned in November of lower demand for economy seats on North Atlantic flights over summer – apparently confirming fears that the market for trips to the US had softened since Donald Trump’s inauguration at the start of 2025.
But chief executive Luis Gallego, who presented the figures yesterday, said: ‘Since Q3 we have seen a rebound.’ He added that bookings for the first quarter of this year were strong.
Aarin Chiekrie at Hargreaves Lansdown said the results ‘flew past expectations’.
Russ Mould at AJ Bell said it was ‘yet another slick performance’ from IAG.
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