International Consolidated Airlines Group SA · LSE:IAG
International Consolidated Airlines Group SA — Q1 2023 Earnings Presentation
30 slides from International Consolidated Airlines Group SA's earnings presentation, May 5, 2023
Slide 1: Connecting people, businesses and countries
Connecting people, businesses and countries 2023 Quarter One results Presentation title 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 One results
Slide 4: Profitable in First Quarter for the first time since Q1 2019
Q1 2023 Highlights Profitable in First Quarter for the first time since Q1 2019 • Positive First Quarter performance driven mainly by continued strong customer demand driving good unit revenue across our diversified Group • Group operating profit before exceptional items of €9m (Q1 2022: operating l
Slide 5: Financial results
Financial results Nicholas Cadbury Chief Financial Officer 2023 Quarter One results 5
Slide 6: Strong revenue driving increased profit in Q1
Q1 2023 Financial results Strong revenue driving increased profit in Q1 IAG Operating result bridge IAG Operating result bridge by business €m €m +750 +750 -109 177 9 -843 34 19 8 10 155 2,386 -840 9 524 -21 (741) (741) Q1-22 BA € IB VY EI IAG Other* Q1-23 Q1-22 Pax Cargo Other NF cost Fuel cost Cur
Slide 7: Our key metrics
Q1 2023 Financial results Our key metrics ASKs 46.0% vLY Activity Total pax revenue PRASK Load factor €5,041m €7.03c 81.5% Commercial performance 89.9% vLY 30.0% vLY 9.3pts vLY Total expenditure CASK Fuel CASK Non-fuel CASK €5,880m €8.21c €2.45c €5.75c Cost performance 40.8% vLY (3.6)% vLY 31.2% vLY
Slide 8: A record profit at Iberia; strong improvement elsewhere
Q1 2023 Financial results A record profit at Iberia; strong improvement elsewhere Q1 2023 Q1 2023 Q1 2023 Q1 2023 vLY vLY vLY vLY (€m) (£m) (€m) (€m) Total revenue 359 +89% 3,042 +78% 1,466 +61% 523 +101% Passenger revenue 341 +104% 2,664 +108% 1,054 +65% 520 +101% Operating result before exceptiona
Slide 9: Our trading in Q1 2023 compared to Q1 2022
Q1 2023 Financial results Our trading in Q1 2023 compared to Q1 2022 Europe North America ASKs (% v22) +53.7% ASKs (% v22) +62.9% PRASK (% v22) +31.6% Total PRASK (% v22) +30.2% Domestic Asia Pacific ASKs (% v22) +46.0% ASKs (% v22) +28.4% ASKs (% v22) +406.1% PRASK (% v22) +30.0% PRASK (% v22) +17.
Slide 10: Seasonal improvement in net debt
Q1 2023 Financial results Seasonal improvement in net debt €m 31 Dec 2019 31 Dec 2020 31 Dec 2021 31 Dec 2022 31 Mar 2023 Gross debt 14,254 15,679 19,610 19,984 19,767 Bank and other loans 1,954 3,369 7,485 6,546 6,461 Asset finance and lease liabilities 12,300 12,310 12,125 13,438 13,306 Cash, cash
Slide 11: Fuel hedging - c.62% for the remainder of 2023
Q1 2023 Financial results Fuel hedging - c.62% for the remainder of 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Jet fuel price scenario $800/mt $800/mt $800/mt $800/mt $750/mt $750/mt $/€ scenario 1.08 1.08 1.08 1.08 1.08 1.08 Hedge ratio 68% 63% 55% 43% 32% 27% Effective blended price post
Slide 12: Business overview and outlook
Business overview and outlook Luis Gallego Chief Executive Officer 2023 Quarter One results 12
Slide 13: Strong leisure demand across the network, business recovering slowly
Business update and outlook Strong leisure demand across the network, business recovering slowly • Leisure demand particularly strong on European leisure-focused cities, Southern European destinations and Summer demand from USA • Business demand impacted by tech industry slowdown and shorthaul UK/Lo
Slide 14: FY 2023 capacity planned to be c.97% of 2019 level
Business update and outlook FY 2023 capacity planned to be c.97% of 2019 level ASKs Q2 2023 Q2 2023 FY 2023 FY 2023 vs 2022 % of 2019 vs 2022 % of 2019 IAG growth +46% +22% +19% +17% +24% vs 2022 +23% 105% +21% 105% +31% 90% +31% 92% Airlines contribution +15% 100% +18% 103% +19% 72% +37% 137% +4% 1
Slide 15: Outlook
Business update and outlook Outlook Customer demand currently remains strong in all IAG's airlines and in all regions, particularly for leisure customers. We expect capacity to be around 97 per cent of 2019 levels for the full year, as we focus on our core markets. We are mindful of a number of unce
Slide 16: Summary
Business update and outlook Summary • Strong and sustained customer demand, particularly in the leisure segment, has delivered a return to profit in the First Quarter for the first time since Q1 2019 • Encouraging outlook for summer demand • We are focusing our disciplined capacity restoration on ou
Slide 17: Appendices
Appendices 17
Slide 18: Our key metrics (v2022 and v2019)
Q1 2023 Financial results Our key metrics (v2022 and v2019) ASKs (5.0)% v19 Activity 46.0% vLY Total pax revenue PRASK Load factor €5,041m €7.03c 81.5% Commercial 9.0% v19 14.8% v19 0.8pts v19 performance 89.9% vLY 30.0% vLY 9.3pts vLY Total expenditure CASK Fuel CASK Non-fuel CASK €5,880m €8.21c €2
Slide 19: Profitable in First Quarter for the first time since Q1 2019
Q1 2023 Financial performance at Group level Profitable in First Quarter for the first time since Q1 2019 (€m) Q1 2023 Q1 2022* Q1 2019 vLY • Operating profit of €9m, including an adverse FX impact of €(54)m Passenger revenue 5,041 2,655 4,623 90% • Total revenue 71% higher than Q1-22 Cargo revenue
Slide 20: Aer Lingus improved performance in the seasonally weakest quarter
Q1 2023 Financial results Aer Lingus improved performance in the seasonally weakest quarter • Passenger revenue +104% vs Q1-22 (€m) Q1 2023 Q1 2022* Q1 2019 vLY • Total Capacity at 148% of 2022 levels, with North Atlantic at 160%. Q1-22 capacity Passenger revenue 341 167 347 +104% impacted by COVID-
Slide 21: British Airways first quarter operating profit since 2019
Q1 2023 Financial results British Airways first quarter 1 operating profit since 2019 (£m) Q1 2023 Q1 2022* Q1 2019** v22 Passenger revenue 2,664 1,282 2,651 108% Cargo revenue 214 286 175 (25)% Other revenue 164 138 134 +19% Total revenue 3,042 1,706 2,960 +78% Employee costs 595 485 642 +23% Fuel,
Slide 22: Iberia strong performance continues, 4.5% operating margin in Q1
Q1 2023 Financial results Iberia strong performance continues, 4.5% operating margin in Q1 (€m) Q1 2023 Q1 2022* Q1 2019 v22 • Group operating profit +€155m vs Q1-22, positive across all business areas (Airline, MRO and Handling). Passenger revenue 1,054 641 830 +65% • Airline EBIT +€143m above Q1-2
Slide 23: Strong revenue and non fuel unit costs performance in a low season quarter
Q1 2023 Financial results Strong revenue and non fuel unit costs performance in a low season quarter (€m) Q1 2023 Q1 2022 Q1 2019 v22 Passenger revenue 520 259 372 +101% Cargo revenue - - - - Other revenue 3 2 4 +108% Total revenue 523 261 376 +101% Employee costs 91 79 63 +16% Fuel, oil costs and e
Slide 24: Loss after tax and exceptional items of €(87)m in Q1 2023
Reconciliation between before exceptional operating result and post exceptional result after tax Loss after tax and exceptional items of €(87)m in Q1 2023 €m Q1 2023 Q1 2022* Operating result (before exceptional items) 9 (741) Exceptional items 0 +23 Operating result (after exceptional items) 9 (71
Slide 25: Group performance: traffic and capacity statistics vs 2022
Q1 2023 traffic and capacity statistics vs 2022 Group performance Quarter Group performance Passengers carried ('000s) Q1 2023 24,279 Q1 2022 14,377 vLY +68.9% Domestic (UK & Spain) 6,345 4,445 +42.7% Europe 12,092 6,422 +88.3% North America 2,456 1,298 +89.2% Latin America & Caribbean 1,569 1,279
Slide 26: Group performance: traffic and capacity statistics vs 2019
Q1 2023 traffic and capacity statistics vs 2019 Group performance Quarter Group performance Passengers carried ('000s) Q1 2023 24,279 Q1 2019 24,382 v19 -0.4% Domestic (UK & Spain) 6,345 5,921 +7.2% Europe 12,092 12,406 -2.5% North America 2,456 2,482 -1.0% Latin America & Caribbean 1,569 1,475 +6.
Slide 27: Group performance by airline vs 2022
Performance by airline Quarter Q1 2023 Q1 2022 vLY Q1 2023 traffic and capacity statistics vs 2022 Passengers carried ('000s) 1,995 1,149 +73.6% Revenue passenger km (m) 4,436 2,275 +95.0% Group performance by airline Available seat km (m) Passenger load factor (%) Cargo tonne km (m) 5,927 74.8 32
Slide 28: Group performance by airline vs 2019
Performance by airline Quarter Q1 2023 Q1 2019 v19 Q1 2023 traffic and capacity statistics vs 2019 Passengers carried ('000s) 1,995 2,196 -9.2% Group performance by airline Revenue passenger km (m) Available seat km (m) Passenger load factor (%) 4,436 5,927 74.8 4,255 5,804 73.3 +4.3% +2.1% +1.5 pt
Slide 29: Alternative Performance Measures (APMs) and Financial terminology definitions
Q1 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 Table in Q1 2023 Interim Management Statement (Reco
Slide 30: Connecting people, businesses and countries
Connecting people, businesses and countries 2023 Quarter One results Presentation title 30
International Consolidated Airlines Group — Q1 2023 Earnings Presentation on 6ix