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IAG lowers annual guidance as British Airways strikes take toll

IAG lowers annual guidance as British Airways strikes take toll

International Airlines Group has said recent strikes at British Airways cost €137 million (£120 million).

The British Airline Pilots’ Association called members out in strike on September 9th and 10th in a dispute over pay and conditions.

A third day of action had been planned for September 27th – but was later called off.

The industrial action initially saw the cancellation of 4,521 flights over a period of seven days.

Subsequently, 2,196 flights were reinstated leaving 2,325 cancellations.


British Airways also introduced flexible commercial policies on 4,070 flights not directly affected by the industrial action.

These policies enabled customers to re-book flights or receive a refund.

The net financial impact of the industrial action is estimated to be €137 million.

In addition, there were further disruption events affecting British Airways in the quarter, including threatened strikes by Heathrow Airport employees, which had a further net financial impact of €33 million.

At the same time, IAG estimates that the latest booking trends in its low-cost segments (primarily Vueling and LEVEL) will have an adverse financial impact of €45 million.

At current fuel prices and exchange rates, IAG therefore expects its 2019 operating profit before exceptional items to be €215 million lower than 2018 pro forma (€3,485 million).

Passenger unit revenue is expected to be slightly down at constant currency, compared to flat guidance previously, and non-fuel unit costs are expected to improve at constant currency, unchanged from previous guidance.

Capacity growth for the fourth quarter is now expected to be about two per cent, which is 1.2 points below previous guidance, and full year capacity growth is expected to be about four per cent, compared to five per cent previously.