International Consolidated Airlines Group Sa · LSE:IAG
International Consolidated Airlines Group Sa — H1 2026 Earnings Presentation
32 slides from International Consolidated Airlines Group Sa's earnings presentation, Jul 31, 2026
Slide 1: We connect what matters
We connect what matters 2026 Half One Results
Slide 2: Disclaimer
Disclaimer LEI: 959800TZHQRUSH1ESL13 Forward-looking statements: This announcement contains forward-looking statements within the meaning of applicable securities laws. This cautionary statement is made for the purpose of providing protection for such forward-looking statements and is intended to qu
Slide 3: Highlights
Highlights Luis Gallego Chief Executive Officer
Slide 4: Strong fundamentals support best-in-class value creation
Strong fundamentals support best-in-class value creation Strong Strong Strong Value Position Execution Creation Unique strength from Delivering world-class Sustainable long-term + = our diverse network, margins earnings growth hubs and brands Delivered by our Significant free cash Premium customers
Slide 5: A robust first half performance despite near-term headwinds
A robust first half performance despite near-term headwinds • Well-positioned due to strong fundamentals • Revenue growth supported by continuing strong demand for travel and our diverse portfolio of markets and customer propositions • Disciplined cost control partly mitigating significant fuel pric
Slide 6: Strong fundamentals delivering sector-leading margins
Strong fundamentals delivering sector-leading margins • H1 revenue growth of 1.0%; resilient second quarter revenue growth of 0.2%, despite the significant impact of the Middle East crisis • A strong first quarter and resilient second quarter have delivered a sector-leading first half operating marg
Slide 7: Financial results
Financial results José Antonio Barrionuevo Chief Financial Officer
Slide 8: Robust H1: growing revenue and disciplined cost control
Robust H1: growing revenue and disciplined cost control €m IAG operating profit bridge by driver: €m IAG operating profit bridge by business: A robust performance Strong performance at Loyalty and British Airways (6.4)% (121)m 828 (23) (14) 1,878 (184) 1,878 44 1,757 48 1,757 (676) (38) (49) (52) (1
Slide 9: Resilient Q2 performance despite headwinds
Resilient Q2 performance despite headwinds €m IAG operating profit bridge by driver: €m IAG operating profit bridge by business: Revenue increase not enough to offset fuel increase All airlines affected by immediate impact of higher fuel (16.3)% (274)m 318 7 14 1,680 1,680 20 1,406 (24) 1,406 (54) (
Slide 10: Resilient margins in our biggest businesses
Resilient margins in our biggest businesses H1 2026 H1 2026 H1 2026 H1 2026 H1 2026 (€m) vLY (£m) vLY (€m) vLY (€m) vLY (£m) vLY Total revenue 1,146 (2.5)% 7,426 +5.4% 3,901 +0.4% 1,501 +1.5% 1,239 +3.4% Passenger revenue 1,106 (2.9)% 6,976 +6.2% 2,978 +4.3% 1,488 +1.6% 627 (1.3)% Operating result b
Slide 11: Resilient demand driving revenue growth
Resilient demand driving revenue growth Total Europe Domestic PRASK1 PRASK ccy2 ASKs CRASK CRASK ccy ASKs CRASK CRASK ccy ASKs Q1 3.5% 8.2% 0.2% Q1 3.5% 6.0% (1.6)% Q1 16.8% 18.2% (2.5)% Q2 1.6% 4.6% (0.5)% Q2 —% 1.2% (3.6)% Q2 1.2% 1.7% 6.7% H1 2.4% 6.2% (0.1)% H1 1.2% 2.9% (2.8)% H1 8.1% 8.9% 2.3%
Slide 12: Disciplined cost control, with FX benefit, supporting margins
Disciplined cost control, with FX benefit, supporting margins H1-26 unit cost Cost category H1 2026 (% vLY) Reflects pay deals, headcount growth driven by planned additional Employee 2.4% capacity and the increase in UK Employers' National Insurance Supplier* (5.4)% Transformation initiatives offset
Slide 13: Adjusted EPS decreased due to reduction in profit
Adjusted EPS decreased due to reduction in profit Six months to 30 June Before Before exceptional Exceptional Reported exceptional Exceptional Reported €m items 2026 items 2026 items 2025 items 2025 Revenue 16,064 – 16,064 15,906 – 15,906 Operating costs 14,307 149 14,456 14,028 – 14,028 Operating p
Slide 14: Consistently generating significant free cash flow
Consistently generating significant free cash flow H1 2026 H1 2025 (€m) (€m) • Working capital impacted by tactical fuel prepayments alongside lower capacity growth Operating profit1 1,757 1,878 Depreciation 1,366 1,257 • IAG Loyalty VAT net payment of €447m to HMRC2 in Working capital 1,436 1,839 2
Slide 15: Continued balance sheet strength
Continued balance sheet strength 30 June 31 December 30 June • Net leverage of 0.6x, reflecting €m 2025 2025 2026 strong profitability and cash Gross debt 14,807 14,267 13,867 generation of which bank and other loans 1,841 1,978 1,743 of which asset financed and lease • Gross leverage of 1.8x: liabi
Slide 16: Excellent financial performance supports strong balance sheet and shareholder rewards
Excellent financial performance supports strong balance sheet, investing in the business and rewarding shareholders Maintain a strong balance Investing in the business Commitment to Excess cash returned sheet sustainable dividends to shareholders Distribute excess cash Maintain net debt / EBITDA Dis
Slide 17: Delivering our strategy
Delivering our strategy Luis Gallego Chief Executive Officer
Slide 18: Our strategy is delivering sustainable margins and returns
Our strategy is delivering sustainable margins and returns Strategic imperatives Medium-term ambition 12-15% A strong core Operating Margin Sustainable profitability Capital-light earnings 13-16% growth RoIC A sustainable value-creation <1.8x Accretive framework Net leverage earnings growth 2026 Hal
Slide 19: A strong core: our diverse portfolio of markets and brands
A strong core: our diverse portfolio of markets and brands Regions Brands Customer segments Share of Group ASKs Premium Non-premium 4.7% 11.0% 30.6% 8.2% Business: Corporate & SME Aer Lingus British Airways VFR: Visiting friends & 24.7% relatives 20.8% Leisure: Holiday & discretionary travel North A
Slide 20: Transformation initiatives underpin resilient margins
Transformation initiatives underpin resilient margins Aer Lingus Transformation A Better BA • Product: announced new business class and • New revenue management and payments platforms Premium Economy delivering revenue benefits • Cost: head office restructure and union consultation • BA app now bein
Slide 21: Investing to drive improving customer experience, resilient operations and future earnings growth
Investing to drive improving customer experience, resilient operations and future earnings growth • A321 XLR fleet now delivered and performing well Renewing our fleet • First B737s for Vueling; re-fleet to secure long-term cost advantage • Completing Club Suite rollout across LHR fleet; A380 retrof
Slide 22: Maintaining sector-leading punctuality across our airlines
Maintaining sector-leading punctuality across our airlines Aer Lingus British Airways Iberia Vueling H1 OTP D15 H1 OTP D15 H1 OTP D15 H1 OTP D15 83.0% 83.0% 89.8% 84.3% 2026 Half One Results 22
Slide 23: IAG Loyalty - Building to a Billion
IAG Loyalty - Building to a Billion Loyalty Highlights • Strong performance vLY: • +9% more active customers* • +15% more Avios issued • +6% more Avios redeemed • New partnerships launched with BP Pulse, Uber Eats in the UK and Cinesa in Spain • Avios.com launched in Spain • Starlink Wi-Fi linked to
Slide 24: Good progress on sustainability in 2026
Good progress on sustainability in 2026 SAF supply Policy Corporate SAF sales We have secured the vast majority of the Welcome UK Government Call for Evidence on SAF sub-targets to avoid non-supply We continue to grow our SAF scope 3 SAF we need to comply with the EU and UK penalties programme to su
Slide 25: Our people are critical to our success
Our people are critical to our success Headcount increased to 78k colleagues, We invest in our people, building with 6k people hired in H1 to support future-ready skills and supporting Inclusive and merit-based decisions culture business growth, improved service and their early careers that strength
Slide 26: Outlook: well-positioned to manage headwinds
Outlook: well-positioned to manage headwinds • Demand continues to be robust; booked revenue at 57% for H2, in line with last year • Long-haul markets strong; short-haul markets more competitive • Expect to be able to recover around 60% of higher fuel cost through revenue and cost initiatives, in li
Slide 27: Appendices
Appendices
Slide 28: Modelling assumptions FY 2026
Modelling assumptions FY 2026 • Capacity (ASK) now expected to be flat in 2026 compared to 2025 • We expect non-fuel unit costs to be flat, including the benefit of FX of around one percentage point reflecting significantly lower capacity growth than previously guided • Total fuel cost scenarios fro
Slide 29: Cash bridge Dec-25 to Jun-26
Cash bridge Dec-25 to Jun-26 €m €856m Free cash flow €2,905m Repayment of lease liabilities €722m 1,943 3,123 (589) (281) (1,291) (179) (194) 9,175 8,319 (519) (203) (667) (209) (78) Actual cash EBITDA* Deferred Other WC Net interest Gross capex Net Repayment Repayment Repayment Treasury Dividends F
Slide 30: Fuel hedging - c70% hedged for 2026
Fuel hedging - c70% hedged for 2026 As per 30/06/26 jet curve Q3 2026 Q4 2026 Q1 2027 Q2 2027 Q3 2027 Q4 2027 Jet fuel price scenario $1,000/mt $950/mt $850/mt $850/mt $800/mt $800/mt $/€ scenario 1.143 1.143 1.143 1.143 1.143 1.143 Hedge ratio 74 % 65 % 55 % 48 % 39 % 31 % Effective blended price p
Slide 31: FY 2026 capacity expected to be flat compared to FY 2025
FY 2026 capacity expected to be flat compared to FY 2025 Airline contribution to IAG ASK growth by quarter vLY Q3 2026 FY 2026 ASKs vLY vLY —% —% 1% (1)% 2% —% 1% —% 6% 4% (1)% (3)% (24)% (10)% 1% —% Q1-26 Q2-26 Q3-26 Q4-26 BA Iberia LEVEL Aer Lingus Vueling Note: British Airways includes BA Cityfly
Slide 32: Alternative Performance Measures (APMs) and terminology definitions
Alternative Performance Measures (APMs) and terminology definitions Measure IFRS/APM Definition Source of calculation Adjusted earnings per share APM Based on results before exceptional items after tax and adjusted for Q2 2026 Interim Management Statement (alternative performance measures section, e
International Consolidated Airlines Group — H1 2026 Earnings Presentation on 6ix