Revenue growth of 9.0% driven by our market-leading network, strong brands and operational focus
• Operating profit before exceptional items increased by 26.7% to €4,443 million (2023: €3,507 million) as we continue to execute
our transformation programme
• Structural improvements delivering a world-class operating margin before exceptional items of 13.8% (2023: 11.9%)
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IAGDelivering sustainable shareholder value creation
Luis Gallego, IAG Chief Executive Officer, said: “These results highlight the quality of our businesses and effectiveness of our strategy, underpinned by the successful execution of our transformation programme across the Group. We are delivering world-class margins and returns, in line with the targets we set out to the market just over a year ago.
“We are focused on continuing to make our brands the first choice for customers, by growing our network and enhancing the customer proposition, while our disciplined capital allocation ensures we can continue to invest in the business, deliver strong financial results and create sustainable value for our shareholders.
“We are particularly pleased to announce that IAG is proposing a final dividend which takes our total dividend for the year to €435 million and intend to return up to a further €1 billion of excess capital to shareholders in up to 12 months.
“This performance would not have been possible without the hard work and dedication of our people, who continue to drive our Group-wide transformation.”
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Image: BA/IAG
Highlights:
Summary
• Revenue growth of 9.0% driven by our market-leading network, strong brands and operational focus
• Operating profit before exceptional items increased by 26.7% to €4,443 million (2023: €3,507 million) as we continue to execute
our transformation programme
• Structural improvements delivering a world-class operating margin before exceptional items of 13.8% (2023: 11.9%)
• Free cash flow of €3,556 million, after investing €2,816 million into the business
• Return on invested capital of 17.3%, as a result of disciplined capital allocation
• Delivering sustainable value creation for our shareholders
• Adjusted earnings per share growth of 12.3%
• Proposing a final dividend of €0.06 per share, taking full year 2024 dividend to €0.09 per share
• €350 million share buyback announced in November 2024
• Intention to return up to a further €1 billion of excess capital in up to 12 months
Executing on our strategy and our transformation programme
Our strategic initiatives are strengthening our market-leading network, brands and operations:
• Improving operational efficiency: 12.3 ppts improvement in On Time Performance at British Airways and 6.9 ppts at Aer Lingus.
Iberia and Vueling remain two of the world’s most punctual airlines
• British Airways benefitting from its £7 billion transformation programme, with operating profit of £2,048 million (2023: £1,344
million) and a 14.2% margin, making good progress towards its 15% medium-term ambition
• €1,427 million operating profit before exceptional items achieved by our Spanish businesses, already close to our €1.5 billion
ambition
• Capital-light earnings growth from IAG Loyalty: operating profit growth of 14.4% to £420 million at a 17.3% margin
• Benefitting from longer term employee agreements that align to improvements in financial and operational performance
• Sustainability: 1.9% SAF used in total in 2024; on track for the required 2% mandate for 2025
Disciplined capital allocation
• Increasingly strong balance sheet, with net debt to EBITDA before exceptional items at 1.1x (2023: 1.7x)
• Targeting to strengthen the balance sheet further by reducing gross leverage over time (31 December 2024: 2.5x)
• €577 million debt repurchase executed in January 2025
• Two thirds of 2025 aircraft deliveries planned to be unencumbered
• Prioritising an ordinary dividend which is sustainable through the cycle
• Targeting to distribute excess cash when net leverage is below 1.2x to 1.5x, with consideration to the outlook and depending on
future capital requirements and commitments, including M&A opportunities
Outlook
• Confident to deliver world-class margins and returns
• Strong customer demand continues
• Non-fuel unit cost trends similar to 2024 (excluding adverse FX impact)
• Significant free cash flow whilst investing in the business
• Sustainable ordinary dividend in place
• Excess capital returns to shareholders, reflecting confidence in the outlook
• Expecting to deliver sustainable earnings per share growth
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Source: IAG
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