IAG maintains airfreight momentum in second quarter

British Airways and Iberia’s parent company International Air Lines Group’s cargo business declined in the second quarter following an overall market softening due to inflation, the pandemic lockdown in China, the invasion of Ukraine and airport congestion.

Nonetheless, the three months ending March 31 were strong as the company returned to profitability for the first time since the pandemic. The company made €113 million ($115 million) in the first half, while he lost $665 million.

Group freight revenue fell 1.9% to $418.4 million despite a 4.6% increase in tonnage over 2021. This was due to lower freight yields (-2% adjusted for currency fluctuations) and lower billable distances. Cargo Tonne Kilometers (CTK), a more important metric for cargo operations, fell 5%, with IAG (CXE: IAG) flew cargo on shorter, less profitable routes.

Freight revenue per CTK, a measure of price, increased by 3.3%.

Cargo revenue increased by 51.6% compared to 2019. Last year was a historic year for the air cargo sector, making year-over-year comparisons difficult.

Cargo revenue increased by 9.6% in the first half of 2021 despite operating only 395 cargo-only passenger flights operated by IAG airlines, compared to 2,677 in the first half of 2021. Reduces the capacity of cargo in aircraft holds, reducing the need to fly temporary freighters. Yields increased his 4.8% as supply chain disruptions continued to constrain airlift capacity.

British Airways, Iberia and sister companies Vueling, Aer Lingus and Rebel do not have pure freighters.

IAG now offers more destinations from London-Heathrow to North America than before the pandemic. We recently launched new service from London to Portland, Oregon, from our hub in Madrid to Dallas and Washington, and resumed service to Pittsburgh. Madrid has eight more international destinations than in 2019.

IAG Cargo said it has shipped more than 3,300 tonnes of baby formula to the United States as part of the government’s Operation Fly Formula program to ease domestic production shortages.

An extensive route network enables greater global movement of goods, especially when flights connect at hub facilities.

“There are undoubtedly challenges facing the entire aviation industry, but today’s results show that investments in route expansion and digitization are paying off,” said Managing Director of IAG Cargo. says David Shepherd. “The resumption of global passenger travel is facilitating additional freight capacity, restoring pre-pandemic schedules and launching new routes for our customers.”

In June, IAG Cargo launched Freightos WebCargo’s new payment tool. This allows freight forwarders who book freight on the freight market to also pay for freight in a single transaction.

Passenger numbers increased 65% from the first quarter to finish the quarter at 78% of 2019 levels, according to IAG. Passenger revenue yield he increased 10.6% from three years ago.

Massive congestion at Heathrow and other European airports due to understaffing continues to undermine performance. IAG and other airlines have canceled flights and scaled back their schedules. Heathrow authorities recently capped passenger numbers until the end of October so ground staff could be replenished.

This situation limited British Airways’ capacity at Heathrow to 69% during the quarter. The airline plans to increase its capacity to 75% this quarter.

CEO Luis Gallego said passenger demand showed no signs of weakening. The company provided guidance on significant improvement in adjusted operating profit and full-year profit in the third quarter.

Click here for more FreightWaves/American Shipper stories by ErMec krish.

related news:

South American Cargo Carrier Joins Freightos Electronic Booking Platform

Lufthansa freight slowed down by German ground staff strike

fbq(‘init’, ‘1517309048360836’, {}, {agent: ‘plsquarespace’});
fbq(‘track’, ‘PageView’); IAG maintains airfreight momentum in second quarter

Back to top button