IAG Reports Resilient First-Half Performance Amid Rising Fuel Costs
International Consolidated Airlines Group (LON:IAG) reported a resilient first-half performance in 2026, with an operating profit of €1.757 billion and a margin of 10.9%, despite challenges from higher fuel costs and disruptions linked to the Middle East conflict. The group maintained its full-year target for an operating-margin range of 12% to 15%. However, second-quarter results were pressured by rising unit fuel costs—up 12.5% year-over-year—and a €489 million increase in total fuel expenses at constant currency. IAG reduced its full-year capacity guidance to flat growth and is focusing on pricing strategies, cost controls, and route adjustments to protect margins. The company improved cash generation significantly, with first-half free cash flow reaching €2.905 billion and net debt falling from €5.9 billion to €4.7 billion. IAG has also returned about €800 million of excess cash under its planned program. British Airways was a standout performer within the group, contributing an operating profit increase of €44 million year-over-year due to strong demand in premium and corporate travel across the North Atlantic network.
Topics: airline industry capacity guidance fuel costs operating profit