London (Reuters) -IAG (LON:ICAG), which owns British Airways, made a profit on Friday for the first time since the COVID-19 pandemic hit. This was made possible by a rise in demand for flights to Europe between April and June.
IAG made an operating profit of 293 million euros ($300 million) in the second quarter, compared to a loss of 967 million euros in the same quarter of 2021. This is the first time the company has made money since 2019.
“This result backs up our expectation that we will have an operating profit for the whole year,” said Chief Executive Luis Gallego. IAG’s stock went up by 2.5% at the start of trading, but then it went flat.
After the most chaotic two years in the history of flying, when COVID caused airports to be empty, planes to be parked, and many airlines to go bankrupt, the owner of Iberia, Vueling, and Aer Lingus is getting back to some sort of normalcy.
In recent months, the industry, especially in Europe, has had a hard time keeping up with the sudden rise in demand. Long lines have formed at many airports because there aren’t enough workers, which has led to last-minute flight cancellations and angry scenes.
But a move by the industry to limit the number of flights seems to have stabilised the situation. This week, both Heathrow Airport in London and low-cost airlines like easyJet (LON:EZJ) and Wizz Air said their operations were getting better.
IAG said that its passenger capacity reached 78% of what it will be in 2019 in the second quarter, and it expects it to reach 80% in the third quarter and 85% in the fourth.
Due to the ongoing problems at Heathrow, BA’s previous estimates for the third and fourth quarters were 85 percent and 90 percent, respectively.
Gallego told reporters that by the end of the year, he hoped Heathrow would be back to normal.
Gallego said, “Our industry continues to face historic problems because operations have grown in a way that has never happened before.” This is especially true in the UK, where Heathrow airport has had a lot of problems.
Even though there is pressure, some airlines are growing again.
Air France-KLM beat expectations for the quarter because both its core and net incomes turned into profits on Friday. But since there were problems at the airport, the company had to lower its forecast for the third quarter.
IAG said that bookings were low because it was the end of the year, but there were no signs that demand was going down.
($1 = 0.9781 euros)