British Airways parent International Airlines Group CEO Luis Gallego in a Thursday earnings call credited “strong and sustained demand for travel” for its fourth quarter and full-year performance.
While executives with IAG, which also includes Iberia, Aer Lingus and Vueling, credited much of that strength to leisure, the corporate segment also is making a comeback. Corporate travel made up about 19 percent of the group’s total 2023 revenue, according to IAG CFO Nicholas Cadbury, a figure that grew 32 percent year over year.
About 19 percent of British Airways and Iberia corporate revenue came from the banking and finance vertical, with 10 percent from technology, 9 percent from accounting and 8 percent from pharmaceuticals. “Other” accounted for 28 percent.
“Within the business segment, we have a diverse exposure to different industry sectors with no reliance of any single sector,” Cadbury said.
Gallego added that by the end of 2023, overall corporate volume reached about 70 percent of 2019 levels, while corporate revenue reached 78 percent, with each airline reporting different levels. British Airways was at about 65 percent of 2019 corporate volume and 75 percent of revenue, while Iberia was at 87 percent of volume and 96 percent of revenue.
“That’s very positive,” Gallego said, noting that the company still does not have the volume it wants, but “it’s coming back. … We are seeing encouraging momentum in corporate travel.”
Q4, Full-Year 2023 Metrics
IAG reported fourth-quarter 2023 revenue of more than €7.2 billion (US$7.9 billion), up from nearly €6.4 billion in Q4 2022. Quarterly passenger revenue was nearly €6.3 billion, a 15.7 percent increase year over year. Full-year total revenue was up 27.7 percent from a year prior to nearly €29.5 billion, with passenger revenue increasing 32.6 percent to more than €25.8 billion.
Operating profit for the quarter was €502 million, up from €232 million a year prior. Full-year profit was more than €3.5 billion, nearly triple the near €1.3 billion reported in 2022.
Fourth-quarter capacity was at 98.6 percent of 2019 levels, while 2023 capacity was at 95.7 percent. The company projects a 7 percent year-over-year increase in capacity for 2024.
British Airways reported a 37.5 percent increase year over year in passenger revenue to €14.3 billion. For Iberia, passenger revenue was up 26.2 percent to nearly €7 billion, while for Aer Lingus, it was up 28.5 percent to nearly €2.3 billion.
On Wednesday, the company announced an agreement to purchase 260 million gallons of sustainable aviation fuel.
Executive Changes
IAG has named Vueling CEO Marco Sansavini as CEO and chairman of Iberia, effective April 1, the company also announced Thursday. He will succeed interim Iberia CEO Fernando Candela, who will continue as CEO of Level, another IAG carrier. Sansavini joined IAG in 2012 as commercial director of Iberia, according to the company. He has been CEO of Vueling since 2020. Previously, he joined Air France-KLM in 2004 as VP of global business.
IAG also named Carolina Martinoli as CEO and chair of Vueling, also effective April 1. She currently is IAG chief people, corporate affairs and sustainability officer. She joined IAG in 2011 and has held various positions for Iberia, British Airways and IAG.
