British Airways parent International Consolidated Airlines Group SA (IAG) reported a 77% rise in full-year profit.
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The company should see further gains in 2016 on a sharp drop in fuel costs and improved operational performance.
Net income in the year in which IAG bought Irish carrier Aer Lingus rose to EUR1.54 billion ($1.7 billion) from EUR1 billion a year earlier, after sales advanced 13% to EUR22.9 billion. Chief executive officer Willie Walsh said the group delivered "very strong results."
IAG's operating profit, excluding Aer Lingus, was EUR2.3 billion compared with guidance of EUR2.25 billion to EUR2.3 billion, the London-based airline said. Including the Irish carrier operating profit rose to EUR2.34 billion.
Sales advanced 13% to EUR22.9 billion but fell on a constant currency basis. Sales in the fourth quarter were dented by the terror attacks in Paris in November.
All IAG units delivered stronger results before exceptional items. British Airways was the biggest profit contributor for the group with a GBP1.38 billion ($1.93 billion) operating profit.
Iberia's operating profit before exceptional items surged almost 400% to EUR247 million, with Vueling contributing EUR160 million in operating profit. Aer Lingus had a full-year operating profit of EUR124 million, of which EUR35 million is included in IAG results.
Fuel is among the airline industry's biggest costs, so the plunge in oil costs since mid-2014 has driven the industry to deliver record profits. IAG also benefited from deep restructuring measures at its Spanish unit Iberia and strong travel demand on key routes such as on trans-Atlantic flights.
"It's undoubtedly been a good year but it's also been challenging with extreme volatility in the currency and fuel markets," said Chief Executive Willie Walsh. The strong dollar has offset some of the benefit of lower fuel, he said.
Operating profit, which rose about EUR1 billion last year, should rise a similar amount in 2016, the airline said. The fuel bill should be around EUR1.2 billion lower again in 2016. ■