International Consolidated Airlines Group Sa · LSE:IAG
International Consolidated Airlines Group Sa — H1 2025 Earnings Presentation
33 slides from International Consolidated Airlines Group Sa's earnings presentation, August 2025
Slide 1: Connecting people, businesses and countries
Connecting people, businesses and countries 2025 Half 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: 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 4: Strong first half of 2025: good earnings growth, margin progression and shareholder returns
Strong first half of 2025: delivering good earnings growth, margin progression and shareholder returns • Revenue growth of 8% reflecting strong demand for our network and brands • H1 operating profit €1,878m, an increase of 43.5% vLY, driven by revenue, fuel and FX – Q2 operating profit €1,680m, an
Slide 5: Financial Highlights
Financial Higigighirs 4
Slide 6: Strong operating profit growth in H1 2025
Strong operating profit growth in H1 2025 IAG operating profit bridge by driver: IAG operating profit bridge by business: Profit improvement supported by transformation, fuel and FX Strong markets, hubs and brands +569 €m +569 €m 372 551 66 157 1,878 271 202 71 1,878 329 (1) (30) (2) 1,309 (848) 1,3
Slide 7: Strong performances across the Group
Strong performances across the Group Aer Lingus British Airways Iberia* Vueling H1 2025 H1 2025 H1 2025 H1 2025 H1 2025 (€m) vLY (£m) vLY (€m) vLY (€m) vLY (£m) vLY Total revenue 1,175 +11.6% 7,044 +4.6% 3,887 +11.4% 1,480 (0.2)% 1,198 +9.4% Passenger revenue 1,139 +12.0% 6,570 +4.1% 2,855 +4.9% 1,4
Slide 8: Strong demand and revenue growth in our core markets
Strong demand and revenue growth in our core markets Currently expect to grow capacity (ASK) by c.2.5% in 2025 North Atlantic Domestic Europe % v24 ASKs PRASK % v24 ASKs PRASK % v24 ASKs PRASK Q2 1.8% 0.6% Q2 2.3% 0.9% Q2 3.5% (0.7)% H1 1.1% 5.4% H1 3.5% (1.6)% H1 2.8% (0.4)% 30.1% of Group H1 ASKs
Slide 9: Non-fuel unit costs in line with guidance
Non-fuel unit costs in line with guidance H1 2025 Cost category H1 2025 unit cost (% vLY) Reflects wage increases and bonus provisions, together with an increase in employee numbers, Employee 7.1% as the Group´s airlines expand capacity and ramp up recruitment ahead of peak summer Driven by inflatio
Slide 10: Adjusted EPS increased by c.70% in H1 2025
Adjusted EPS increased by c.70% in H1 2025 Six months to 30 June Before Before exceptional Exceptional Reported exceptional Exceptional Reported €m items 2025 items 2025 items 2024 items 2024 Revenue 15,906 – 15,906 14,724 – 14,724 Operating costs 14,028 – 14,028 13,415 – 13,415 Operating profit 1,8
Slide 11: Significant free cash flow generated in H1 2025
Significant free cash flow generated in H1 2025 H1 2025 H1 2024 (€m) (€m) H1 2025 1 Operating profit 1,878 1,309 • Strong revenue, fuel and FX delivering higher operating profit Depreciation 1,257 1,140 • Higher depreciation reflecting fleet deliveries Working capital 1,839 2,266 • Lower working cap
Slide 12: Stronger balance sheet gives flexibility in capital allocation
Stronger balance sheet gives flexibility in capital allocation 30 June 31 December 30 June Further reduction in net leverage €m 2024 2024 2025 • Net leverage of 0.7x Gross debt 16,115 17,345 14,807 Reducing gross leverage of which bank and other loans 2,679 2,911 1,841 of which asset financed and le
Slide 13: Investing in our fleet, improving customer experience and resilience
Investing in our fleet, improving customer experience and resilience Gross capital expenditure H1 actual: c.€3.7bn • 13 fleet deliveries; 5x A320neo, 3x Property Property maintenance and airport equipment replacement/ Lower expenditure than planned in & equipment upgrades and lounges A321neo, 4x A32
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: 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 17: Sustaining our focus on margins and return on capital
Sustaining our focus on margins and return on capital Transforming Developing Spanish Accelerating capital-light British Airways platforms earnings: Loyalty & Holidays Driving high customer satisfaction, profits Deliver €1.4bn of operating profit from Leverage Loyalty for higher growth, and margins
Slide 18: Diversified portfolio of leading positions in our core markets
Diversified portfolio of leading positions in our core markets North Atlantic Latin America Intra-Europe • #1 long-haul market from Europe by size • #1 revenue growing market from Spain • Spain is #1 domestic market in Europe (€43bn market) (+60% vs 2019) • UK is the #3 market, with UK-ES the • Lond
Slide 19: Strong improvement in OTP at BA and Aer Lingus; Iberia and Vueling world-class
Strong improvement in OTP at BA and Aer Lingus; Iberia and Vueling world-class; conditions still challenging OTP (D´15) OTP (D´15) 82.3% 83.1% 80.0% 76.8% 81.3% 72.6% 79.1% 83.8% 82.7% 83.2% 72.1% 75.5% 2024 2025 2024 2025 Q1 Q2 H1 Q1 Q2 H1 OTP (D´15) 89.8% 90.5% 87.0% 89.2% 87.1% 89.8% British Airw
Slide 20: Investing in our customers' experience in 2025
Investing in our customers’ experience in 2025 Journey Dreaming, planning Check in Lounge On-board Disruption, Our service & booking connections & arrivals ✔ ✔ ✔ New inflight entertainment ✔ Customers eligible for hotel ✔ Expanded bag self-drop at T2 New Avios-only flights launched, with the content
Slide 21: Cost transformation integral to margin improvement
Cost transformation integral to margin improvement Aer Lingus British Airways • New Engine Optimisation System (developed • Zero-Based Budgeting driving efficiencies in-house by IAG.ai) to reduce engine lifecycle throughout the business costs • Systems and process optimisation of • In-sourcing of en
Slide 22: Continuing strong earnings growth at IAG Loyalty
Continuing strong earnings growth at IAG Loyalty Loyalty Highlights • +17% more Avios issued than H1 2024 • +15% more Avios redeemed than H1 2024 • +9% more active customers than H1 2024 • A promotion to earn tier points with Amex Premium Plus card went live in June • Launched new partnership with L
Slide 23: Our people are critical to our success
Our people are critical to our success We invest in our people, supporting their We created c.2.5k jobs in the last year — skills, development, and careers delivering better customer service, operational resilience and business growth Principles • We have multi-year agreements in place for the major
Slide 24: Good progress on sustainability in 2025
Good progress on sustainability in 2025 Contractually secured over 200,000 tonnes Signed new SAF Scope 3 agreement with Received first supply of SAF from Phillips 66 Microsoft for 39,000 tonnes of SAF over five of SAF for delivery in 2025 – 25% greater going into British Airways flights from Los yea
Slide 25: Outlook - delivering good earnings growth
Outlook - delivering good earnings growth • We are confident in delivering good earnings growth, margin progression and strong returns to shareholders this year, whilst being mindful of the ongoing uncertainty that may result from the geopolitical and macroeconomic backdrop • We are continuing to se
Slide 26: Appendices
Appendices
Slide 27: Modelling assumptions
Modelling assumptions • Revenue – Capacity increase of c.2.5% - subject to challenges around ATC and aircraft engine reliability • Non-fuel unit costs – Now expected to increase by around 3%, compared to previous guidance of around 4% – Reflects a small increase in underlying costs due to lower capa
Slide 28: Q2 - Strong performances across the Group
Q2 - Strong performances across the Group Aer Lingus British Airways Iberia* Vueling Q2 2025 Q2 2025 Q2 2025 Q2 2025 Q2 2025 (€m) (£m) (€m) (€m) (£m) Total revenue 737 +10.5% 3,878 +3.8% 2,058 +8.1% 913 +2.4% 672 +16.7% Passenger revenue 719 +11.5% 3,643 +3.5% 1,561 +2.6% 908 +2.3% 351 +23.1% Operat
Slide 29: Q2 operating profit bridge
Q2 operating profit bridge IAG operating profit bridge by driver: IAG operating profit bridge by business: Profit improvement supported by transformation, fuel and FX Strong markets, hubs and brands €m +439 €m +439 185 138 1,680 28 44 1 6 1,680 326 38 145 135 225 1,241 1,241 (393) Q2-24 Pax Cargo Ot
Slide 30: Cash bridge Dec-24 to Jun-25
Cash bridge Dec-24 to Jun-25 €m €(480)m Free cash flow of €2,097m Repayment of lease liabilities €(682m) 1,945 3,135 414 (447) (478) (368) 9,828 (1,690) 9,348 (1,292) (492) (190) (771) (227) (19) Actual EBITDA* Deferred Payment Other WC Net Gross Proceeds Repayment Repayment Repayment Treasury Divid
Slide 31: Fuel hedging - 77% hedged for the remainder of 2025
Fuel hedging - 77% hedged for the remainder of 2025 As per Q2 2025 results Q3 2025 Q4 2025 Q1 2026 Q2 2026 Q3 2026 Q4 2026 Jet fuel price scenario $710/mt $690/mt $680/mt $670/mt $670/mt $670/mt $/€ scenario 1.1523 1.1523 1.1523 1.1523 1.1523 1.1523 Hedge ratio 79 % 75 % 61 % 52 % 40 % 32 % Effectiv
Slide 32: FY 2025 capacity planned to be c.2.5% higher than 2024
FY 2025 capacity planned to be c.2.5% higher than 2024 Q3 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% +2% +2% +3% +2.5% 7% 7% 1% 2% —% 1% 5% 12% 6% 4% FY-25 2% 2.5% Q1-25 Q2-25 Q3-25 Q4-25 Note: Brit
Slide 33: 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 2025 Results Release (alternative performance measures section, note b: earnin
International Consolidated Airlines Group, S.A. (IAG) — H1 2025 Earnings Presentation on 6ix