International Consolidated Airlines Group SA · LSE:IAG
International Consolidated Airlines Group SA — Q3 2023 Earnings Presentation
27 slides from International Consolidated Airlines Group SA's earnings presentation, October 2023
Slide 1: Connecting people, businesses and countries
Connecting people, businesses and countries 2023 Quarter Three results 1
Slide 2: Disclaimer
Disclaimer LEI: 959800TZHQRUSH1ESL13 Forward-looking statements: Certain statements included in this document and any related conference call or webcast (including any related Q&A session) are forward-looking. These statements can be identified by the fact that they do not relate only to historical
Slide 3: Highlights
Highlights Luis Gallego Chief Executive Officer 2023 Quarter Three results
Slide 4: Record third quarter profit with strong trading and a stronger Balance Sheet
Q3 2023 Highlights Record third quarter profit with strong trading across the Group and a significantly stronger Balance Sheet • Record Q3 profit driven by a strong trading performance across the Group • Group operating profit before exceptional items of €1,745m (vs Q3 2022 €1,216m) • Sustained stro
Slide 5: Financial results
Financial results Nicholas Cadbury Chief Financial Officer 2023 Quarter Three results 5
Slide 6: Record profit in the third quarter
Q3 2023 Financial results Record profit in the third quarter IAG Operating result bridge IAG Operating result bridge by business €m +529 €m +529 (110) 110 (689) 1,317 1,745 (195) 1,745 96 57 26 (7) 23 194 1,216 1,216 236 Q3-22 Pax revenue Cargo Other NF cost Fuel cost Currency Q3-23 Q3-22 BA € IB VY
Slide 7: Our key metrics
Q3 2023 Financial results Our key metrics ASKs +17.9% vLY Activity Total pax revenue PRASK Load factor €7,733m €8.76c 88.9% Commercial performance +20.5% vLY +2.2% vLY +1.9pts vLY Total expenditure CASK Fuel CASK Non-fuel CASK €6,901m €7.82c €2.30c €5.52c Cost +12.9% vLY (4.3)% vLY (6.2)% vLY (3.5)%
Slide 8: Strong performance across the Group
Q3 2023 Financial results Strong performance across the Group Q3 2023 Q3 2023 Q3 2023 Q3 2023 Q3 2023 vLY vLY vLY vLY vLY (€m) (£m) (€m) (€m) (£m) Total revenue 769 +16.4% 4,038 +20.3% 1,943 +18.8% 1,081 +5.9% 355 +58.0% Passenger revenue 754 +17.7% 3,592 +24.7% 1,558 +23.4% 1,076 +5.9% 211 +39.5 Op
Slide 9: Our trading in Q3 2023 compared to Q3 2022
Q3 2023 Financial results Our trading in Q3 2023 compared to Q3 2022 (% v22) Europe North America ASKs +7.2% ASKs +15.2% PRASK +6.3% Total PRASK +0.6% Domestic Asia Pacific ASKs +17.9% ASKs +2.5% ASKs +347.6% PRASK +2.2% PRASK +8.8% PRASK (0.8)% Africa, ME & South Asia Latin America & Caribbean ASKs
Slide 10: Continued Balance Sheet strengthening
Q3 2023 Financial results Continued Balance Sheet strengthening €m 31 Dec 2019 31 Dec 2022 30 Sep 2022 30 Sep 2023 Gross debt 14,254 19,984 20,318 17,227 Bank and other loans 1,954 6,546 6,940 3,567 Asset financed and lease liabilities 12,300 13,438 13,378 13,660 Cash, cash equivalents and interest-
Slide 11: Manageable debt repayment schedule
Q3 2023 Financial results Manageable debt repayment schedule €m £2.0bn UKEF backed loan fully repaid 28 Sep 2023 €500m IAG bond repaid 825 825 4 Jul 2023 700 572 451 287 €825m €715m €700m 27 €571m €285m Q4 2023 2024 2025 2026 2027 2028 2029 Bonds issued by ICAG Other secured loans Other unsecured bo
Slide 12: Fuel hedging - c.73% for the remainder of 2023
Q3 2023 Financial results Fuel hedging - c.73% for the remainder of 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1 2025 Jet fuel price scenario $1,015/mt $965/mt $915/mt $865/mt $865/mt $865/mt $/€ scenario 1.07 1.07 1.07 1.07 1.07 1.07 Hedge ratio 73% 73% 58% 48% 40% 29% Effective blended price po
Slide 13: Profit after tax and exceptional items of €2,151m in 9M 2023
Q3 2023 Financial results Profit after tax and exceptional items of €2,151m in 9M 2023 Nine months to 30 September 2023 Before Before Statutory Exceptional Statutory Exceptional €m exceptional items exceptional items 2023 items 2022 items 2023 2022 Revenue 22,229 - 22,229 16,680 - 16,680 Operating c
Slide 14: Business overview and outlook
Business overview and outlook Luis Gallego Chief Executive Officer 2023 Quarter Three results 14
Slide 15: Strong demand across our airlines and our network in Q3
Business update and outlook Strong demand across our airlines and our network in Q3 • Leisure demand remained strong in all regions, particularly US premium, driving record business cabin load factors • Business demand recovering slowly; shorthaul particularly impacted by fewer day-trips /one-night
Slide 16: Outlook
Business update and outlook Outlook • We expect full year 2023 capacity to be around 96% of pre-COVID-19 levels • Customer bookings for Q4 as expected with around 75% of the fourth quarter’s passenger revenue already booked • Whilst the business is performing well and we maintain good forward bookin
Slide 17: Summary
Business update and outlook Summary • Record third quarter profit with sustained strong demand driving positive unit revenue across our airlines and across our network • Balance Sheet continues to strengthen: gross debt has reduced by over €3bn in the last 12 months and IAG and British Airways now I
Slide 18: Appendices
Appendices 18
Slide 19: FY 2023 capacity planned to be c.96% of 2019 level
Business update and outlook FY 2023 capacity planned to be c.96% of 2019 level ASKs Q4 2023 Q4 2023 FY 2023 FY 2023 vs 2022 % of 2019 vs 2022 % of 2019 IAG growth +46% +20% +18% +15% +23% vs 2022 +9% 108% +20% 104% +16% 93% +29% 90% Airlines’ contributions +20% 111% +19% 103% +23% 124% +36% 136% +6%
Slide 20: Our key metrics (v2022 and v2019)
Q3 2023 Financial results Our key metrics (v2022 and v2019) ASKs (4.4)% v19 Activity +17.9% v22 Total pax revenue PRASK Load factor €7,733m €8.76c 88.9% Commercial +19.1% v19 +24.6% v19 +1.2pts v19 performance +20.5% v22 +2.2% v22 +1.9pts v22 Total expenditure CASK Fuel CASK Non-fuel CASK €6,901m €7
Slide 21: Record third quarter profit performance at Group level
Q3 2023 Financial performance at Group level Record third quarter profit • Operating profit of €1,745m, including a favourable FX impact of €35m €m Q3 2023 Q3 2022* Q3 2019** vs22 • Operating margin up 3.6pts reflecting a strong performance across our airlines due to Passenger revenue 7,733 6,416 6,
Slide 22: Group performance traffic and capacity statistics vs 2022
Q3 2023 traffic and capacity statistics vs 2022 Group performance Quarter Year to date Q3 2023 Q3 2022 vLY 2023 2022 vLY Group performance Passengers carried ('000s) 33,241 29,535 +12.5% 87,548 69,504 +26.0% Domestic (UK & Spain) 8,192 7,714 +6.2% 22,027 18,997 +15.9% Europe 17,722 15,969 +11.0% 4
Slide 23: Group performance traffic and capacity statistics vs 2019
Q3 2023 traffic and capacity statistics vs 2019 Group performance Quarter Year to date Q3 2023 Q3 2019 v19 2023 2019 v19 Group performance Passengers carried ('000s) 33,241 34,562 -3.8% 87,548 90,448 -3.2% Domestic (UK & Spain) 8,192 8,067 +1.5% 22,027 21,442 +2.7% Europe 17,722 18,997 -6.7% 45,587
Slide 24: Group performance by Opco vs 2022
Performance by airline Quarter Year to date Q3 2023 Q3 2022 vLY 2023 2022 vLY Q3 2023 traffic and capacity statistics vs 2022 Passengers carried ('000s) 3,282 2,982 +10.1% 8,336 6,672 +24.9% Revenue passenger km (m) 7,875 6,980 +12.8% 19,755 14,850 +33.0% Group performance by Opco Available seat k
Slide 25: Group performance by Opco vs 2019
Performance by airline Quarter Year to date Q3 2023 Q3 2019 v19 2023 2019 v19 Q3 2023 traffic and capacity statistics vs 2019 Passengers carried ('000s) 3,282 3,590 -8.6% 8,336 9,041 -7.8% Revenue passenger km (m) 7,875 7,782 +1.2% 19,755 19,033 +3.8% Group performance by Opco Available seat km (m
Slide 26: Alternative Performance Measures (APMs) and Financial terminology definitions
Q3 2023 Financial results Alternative Performance Measures (APMs) and Financial terminology definitions Measure IFRS/APM Definition Source of calculation Operating profit (and other Income APM See IAG 2022 ARA (APMs section) and accounting policies Q3 2023 Interim Management Statement (Reconciliatio
Slide 27: Connecting people, businesses and countries
Connecting people, businesses and countries 2023 Quarter Three results Presentation title 27
International Consolidated Airlines Group — Q3 2023 Earnings Presentation on 6ix