European airlines see strong summer bookings, hoping to avoid disruption

  • IAG first quarter results beat expectations
  • IAG raises full-year profit guidance
  • Air France-KLM earnings soar as operating loss hits stock

LONDON (Reuters) – IAG, which owns British Airways, and Air France KLM have reported a surge in summer bookings as travelers go ahead with their holiday plans despite the cost of living crisis. major airports.

European airlines and airports are under pressure to avoid a repeat of the chaotic conditions last summer that prevented a return to mass travel after the COVID-19 pandemic freeze.

IAG (ICAG.L)The company, which also owns Iberia, Vueling and Aer Lingus, said on Friday that better-than-expected summer and winter ticket sales meant profits in 2023 were above previous estimates.

Its positive outlook is in line with other major European airlines. Lufthansa, easyJet and Ryanair all noted strong summer bookings, with consumers prioritizing travel spending despite high inflation and an uncertain economic outlook. indicates that there is

IAG called the summer outlook “promising”, saying capacity in key North Atlantic and Latin American markets is now back to pre-pandemic levels and demand from leisure travelers is driving bookings. Stated.

But Chief Executive Luis Gallego has warned of capacity at London’s Heathrow airport this summer and French air traffic controllers (ATC), whose protests over raising the retirement age have disrupted travel since January. He said he was concerned about the possibility of another strike by the

british airways is cut flight Amid the Easter holidays at Heathrow due to labor unrest, the Hub capped passenger numbers last summer to deal with staff shortages, but said it would not have a similar measure this year.

“I’m very worried about ATC in France,” Gallego told analysts in a post-earnings call. “For example, at Vueling, 80% of his flights are over French airspace, so I think this is something we are concerned about.”

The group said it now expects annual earnings to exceed the upper end of the €1.8 billion to €2.3 billion ($2.0 billion to $2.5 billion) range awarded in February, with a 3% fall in the share price by 0750 GMT. raised. The high end of that range is already a 90% jump from last year’s results.

In the three months to the end of March (a period often costly for airlines as fewer tourists traveled at the time), IAG said a combination of high demand and lower fuel prices contributed to its return to profitability. says.

Operating profit was ahead of an exceptional item of €9 million, well above the €179 million loss expected by analysts.

Air France-KLM (AIRF.PA) It also said that summer ticket sales are doing well after first-quarter revenue reached 6.33 billion euros, up 42% year-on-year. However, the stock fell 5% in early trading as an operating loss of €306 million exceeded market expectations for his €294 million loss.

The company also projects 2023 supply capacity at 95% of pre-pandemic levels, compared to 95-100% previously.

In another sign of travel recovery, Holiday Inn owner IHG Plc (IHG.L) reported 33% Jump First Quarter Revenue Per Available Room (RevPAR) – A key indicator of a hotel’s top-line performance.

Hotel operators are benefiting from China lifting COVID-19 restrictions and boosting travel across the Asia-Pacific region.

($1 = 0.9058 EUR)

Reported by Sarah Young.Editing by Andrew MacAskill

Our criteria: Thomson Reuters Trust Principles.

Sarah Young

thomson Reuters

Sarah reports on the latest UK news with a focus on UK companies. During her 12 years, she was part of the UK bureau covering everything from airlines to energy, royals, politics and sports. She is an avid open water swimmer.

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