IAG off to a flier with maiden first quarter profit

International Consolidated Airlines Group, the owner of British Airways and Spain's Iberia, flew back into the black in the traditionally weak first quarter.

IAG beat expectations with an operating profit of €25m, its first ever in the first-quarter, compared to the €150m loss posted in the same period last year as its two core airlines enjoyed strong improvements as well as budget airline Vueling.

The airline group, which is currently negotiating with the Irish government over its attempts to acquire Aer Lingus, saw total revenues take off by 12% to €4.7bn, of 3.7% at constant forex rates.

Chief Executive Willie Walsh hailed the "consistent positive performance" in the key North American market and a disciplined performance on costs, along with a 5% increase in capacity.

Non-fuel unit costs were brought down by 2.7% and fuel unit costs by 11.0% at constant currencies.

Though with total operational costs rising 8%, the group lost €37m at the pre-tax line.

"As before, fuel costs benefitted by operating more efficient aircraft and lower fuel prices though hedging and significant currency headwinds reduced the positive impact of lower oil prices," Walsh explained.

"Cost discipline across our airlines continued through increased productivity and supplier cost savings, enabling us to improve our operating margin while growing capacity by 5.0%."