Moody's upgrades outlook on British Airways

Moody’s has changed its outlook on British Airways’ Ba2 rating to positive from stable and affirmed the airline’s ratings.

The decision, announced on Friday, “reflects the potential for further strengthening of the airline’s credit metrics following its strong performance”.

Moody’s highlighted the airline’s rise in operating profit to £945m for the first nine months of the year, up from £753m in 2014.

It also signalled it could enable BA’s financial profile to support a higher rating in the next 12 to 18 months.

"Our positive outlook on BA's ratings reflects the company's strengthened competitive profile in the airline industry and our expectation for further improvement in the company's operating performance and credit metrics going into 2016," said Moody's Vice President - Senior Credit Officer and lead analyst for BA Sven Reinke.

Despite the outlook upgrade, shares in parent company International Consolidated Airlines Group (IAG) were down 4.5p (0.77%) to 578p at 1156 GMT.