British Airways and Iberia parent IAG nearly trebled full-year operating profits in 2023 to just over €3.5 billion ($3.8 billion) after lifting revenue 28% during the year.

The group operating profit was sharply up on the €1.24 billion it made in 2022 and higher than the €3.25 billion it made in 2019 before the pandemic – though it was short of the group’s highest operating profit in 2018 of €3.68 billion after exceptional items. 

IAG British Airways

Source: Fasttailwind/Shutterstock

Group net profit for the year jumped from €431 million to €2.61 billion.

IAG chief executive Luis Gallego says: “In 2023, IAG more than doubled its operating margin and profits compared to 2022, generated excellent free cash flow and strengthened its balance sheet position, recovering capacity to close to pre-Covid-19 levels in most of its core markets.”

Across the year IAG group capacity was back at more than 95% of pre-pandemic levels and reached almost 99% of 2019 ASKs in the fourth quarter. This helped drive passenger revenues, which climbed nearly a third to €25.8 billion. While cargo revenues fell 28% as the air freight market normalised, overall revenues were nearly 28% at €29.5 billion.

All four of IAG’s main airline units increased profits for the year. Its largest unit British Airways posted the biggest in absolute terms, increasing by $1.1 billion to €1.4 billion, while Iberia was the most profitable by operating margin. The Spanish carrier recorded a margin of 13.5% in lifting operating profits by €551 million to €940 million.

IAG airline units by revenue/operating profit 2023
 2023 revenue Increase v 20222023 op profitIncrease v 2022
 Source: IAG
British Airways €14,323m €3,293m €1,431m €1,106m
Iberia €6,958m €1,447m €940m €551m
Vueling  €3,198m €600m €396m €201m
Aer Lingus €2,274m €505m €225m €168m
IAG total €29,453m €6,387m €3,507m €2,260m