International Consolidated Airlines Group Sa · LSE:IAG
International Consolidated Airlines Group Sa — Q1 2025 Earnings Presentation
24 slides from International Consolidated Airlines Group Sa's earnings presentation, May 2025
Slide 1: Connecting people, businesses and countries
Connecting people, businesses and countries 2025 Quarter One results
Slide 2: Disclaimer
Disclaimer LEI: 959800TZHQRUSH1ESL13 Forward-looking statements: Certain statements included in this announcement are forward-looking. These statements can be identified by the fact that they do not relate only to historical or current facts. By their nature, they involve risk and uncertainties beca
Slide 3: Highlights
Highlights Luis Gallego Chief Executive Officer
Slide 4: A world-class investment case
A world-class investment case Strong Strong Strong Value Position Execution Creation Unique strength in our Delivering world-class Sustainable earnings + = network, hubs and margins growth brands Delivered by our Strong free cash flow Premium customers transformation generation Growing IAG Loyalty p
Slide 5: Strong start to 2025; Outlook unchanged
Strong start to 2025; Outlook unchanged • Revenue growth of 9.6% reflecting strong demand for our network and brands • Operating profit €198m, an increase of €130m • Transformation programme supporting a 1.7pts increase in operating margin • Good operational performance, particularly at British Airw
Slide 6: Financial Highlights
Financial Higigighirs 4
Slide 7: Strong operating profit growth in Q1 2025
Strong operating profit growth in Q1 2025 IAG operating profit bridge by driver: IAG operating profit bridge by business: Strong markets, hubs and brands Good performance across the Group €m +130 €m +130 212 35 67 27 368 (2) 198 104 (30) (36) 74 11 198 68 68 (570) Q1-24 Pax Cargo Other NF cost Fuel
Slide 8: Strong performances across the Group
Strong performances across the Group Aer Lingus British Airways Iberia* Vueling Q1 2025 Q1 2025 Q1 2025 Q1 2025 Q1 2025 (€m) vLY (£m) vLY (€m) vLY (€m) vLY (£m) vLY Total revenue 438 +13.5% 3,166 +5.5% 1,829 +15.3% 567 (4.1)% 526 +1.3% Passenger revenue 420 +12.9% 2,927 +4.9% 1,294 +7.7% 564 (4.0)%
Slide 9: Continued strong demand in all our core markets
Continued strong demand in all our core markets Currently expect to grow capacity (ASK) by 3% in 2025 North Atlantic Domestic Europe % v24 ASKs PRASK % v24 ASKs PRASK % v24 ASKs PRASK Q1 0.2% 13.0% Q1 4.7% (4.5)% Q1 1.8% (0.2)% 8.4% of Group Q1 ASKs 23.3% of Group Q1 ASKs 27.8% of Group Q1 ASKs Tota
Slide 10: Non-fuel unit costs increased in Q1 vLY as expected
Non-fuel unit costs increased in Q1 vLY as expected Q1 2025 Cost category Q1 2025 FY 2025 guidance unit cost (% vly) Employee 8.5% c.2.2% - impact of FX headwinds c.2.5% - non-airline costs including costs Supplier 9.5% related to the growth of Iberia's MRO business Overall non-fuel unit cost expect
Slide 11: Profit after tax and exceptional items of €176m in Q1 2025
Profit after tax and exceptional items of €176m in Q1 2025 Three months to 31 March Before Before exceptional Exceptional Reported exceptional Exceptional Reported €m items 2025 items 2025 items 2024 items 2024 Revenue 7,044 – 7,044 6,429 – 6,429 Operating costs 6,846 – 6,846 6,361 – 6,361 Operating
Slide 12: Stronger balance sheet: net leverage reduced to 0.9x
Stronger balance sheet: net leverage reduced to 0.9x 31 March 31 December 31 March €m 2024 2024 2025 Reducing gross leverage: Gross debt 16,164 17,345 15,486 • Bond buyback €577m across both 2027 of which bank and other loans 2,683 2,911 1,706 and 2029 unsecured bonds in Jan 2025 of which asset fina
Slide 13: Stronger balance sheet: reducing our financial liabilities
Stronger balance sheet: reducing our financial liabilities €m €277m €300m €500m bond early bond early bond repaid repaid repaid in Q1 2025 in Q1 2025 826 in Q1 2025 401 296 33 36 Q2-Q4 2025 2026 2027 2028 2029 Bonds issued by ICAG Other secured loans Other unsecured bonds and loans • €500 million fi
Slide 14: Disciplined capital allocation to support profitable growth and shareholder returns
Disciplined capital allocation to support profitable growth, best-in-class margins and sustainable shareholder returns Maintain balance Invest in rebuilding Improve customer Commitment to Excess cash returned sheet strength our fleet experience, sustainable to shareholders if resilience, digital div
Slide 15: Delivering our strategy
Delivering our strategy
Slide 16: Transforming our businesses
Transforming our businesses British Airways Iberia • Increased services to key long-haul destinations: Nashville, Sao • Continued strengthening LatAm position: increase presence in Paulo, Bangkok and Riyadh. Deployment of A350s to Rio and Buenos Aires and Sao Paulo. Developing key NATL destinations
Slide 17: Outlook
Outlook • Whilst being mindful of geopolitical and macroeconomic uncertainty, our outlook is unchanged • We are continuing to see good demand for air travel across our core markets and for our brands, highlighting the strength of our portfolio • Latin America and Europe continue to be strong and the
Slide 18: Our strategy to deliver world-class margins and returns
Our strategy to deliver world-class margins and returns Strategic imperatives Medium-term ambition A strong core 12-15% operating margin Sustainable profitability Capital-light earnings 13-16% RoIC growth A robust financial and Accretive <1.8x net leverage through cycle sustainability framework grow
Slide 19: Appendices
Appendi ces ‘
Slide 20: Our key metrics for Q1 2025
Our key metrics for Q1 2025 ASKs 79,134m Activity +3.2% vLY Total revenue Total pax revenue Pax RASK Load factor €7,044m €6,000m €7.58c 82.7% Commercial +3.2% vLY +9.6% vLY +6.5% vLY (0.4)pts vLY performance Total expenditure Total CASK Fuel CASK Non-fuel CASK €6,846m €8.65c €2.17c €6.48c Cost +8.8%
Slide 21: Modelling assumptions
Modelling assumptions • Revenue – Capacity increase of c.3% - continuing focus on our core markets • Non-fuel unit costs – Increase of around 4%, including an adverse FX impact – Weighted to H1 ahead of the summer peak • Fuel costs – c.65% hedged for the rest of the year. At $730/MT expected total f
Slide 22: Fuel hedging
Fuel hedging As per FY 2024 results Q1 2025 Q2 2025 Q3 2025 Q4 2025 Q1 2026 Q2 2026 Jet fuel price scenario $750/mt $760/mt $760/mt $750/mt $730/mt $730/mt $/€ scenario 1.044 1.044 1.044 1.044 1.044 1.044 Hedge ratio 72 % 67 % 60 % 49 % 39 % 32 % Effective blended price post fuel and FX $745/mt $765
Slide 23: FY 2025 capacity planned to be c.3% higher than 2024
FY 2025 capacity planned to be c.3% higher than 2024 Q2 2025 FY 2025 Airline contribution to IAG ASK growth Airline contribution to total IAG ASKs by quarter vLY ASK growth for FY 2025 vLY vLY vLY +3% +3% +3% +4% +3% 11% 6% 3% 2% (1)% 3% (2)% 12% 4% 3% FY-25 3% 3% Q1-25 Q2-25 Q3-25 Q4-25 Note: Briti
Slide 24: Alternative Performance Measures (APMs) and terminology definitions
Alternative Performance Measures (APMs) and terminology definitions Measure IFRS/APM Definition Source of calculation Capex (or gross capital expenditure) IFRS Acquisition of property, plant and equipment and intangible assets per Direct from Cash flow statement (Net cash flows from investing activi
International Consolidated Airlines Group — Q1 2025 Earnings Presentation on 6ix