International Consolidated Airlines Group (IAG) has made headlines with its strategic decision to return up to 1 billion euros of excess capital to its shareholders over the upcoming 12 months, following a remarkable increase in revenue and profits for the full year 2024. The UK-based airline conglomerate, which is the parent company of illustrious brands such as British Airways, Aer Lingus, and Iberia, announced that its after-tax profit for 2024 rose to 2.73 billion euros, a slight increase from 2.66 billion euros recorded in the previous year.
The company's operating profit saw a significant surge of 22.1%, reaching 4.28 billion euros. This impressive growth can be attributed to higher passenger unit revenues combined with a reduction in fuel unit costs, showcasing a positive shift in the operational dynamics of the group. During this period, the group's total revenue experienced a substantial climb from 29.45 billion euros to 32.10 billion euros.
A notable part of this success stemmed from a 9.5% increase in passenger revenue, which amounted to 28.27 billion euros. This growth was supported by the reopening of various markets, a robust demand for leisure travel, and elevated ticket prices reflecting inflationary trends that have impacted global travel costs. Luis Gallego, the Chief Executive Officer of IAG, commented on these impressive results: "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." His remarks emphasize the company's ongoing commitment to strategic excellence and financial performance. The board's recommendation of a final dividend of 0.06 euros per share for 2024 will elevate the total annual dividend to 0.09 euros per share.
This decision marks a significant shift, as the group did not distribute any dividends in 2023, reflecting a reinvestment strategy that now comes full circle towards rewarding shareholders. Looking ahead to 2025, IAG's outlook remains optimistic, anticipating sustained strong demand from customers alongside a projected capacity increase of 3%.
The group remains steadfast in its focus on core market expansions while ensuring their brands become the preferred choice for travelers. Gallego further stated, "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." This vision highlights IAG's strategic priorities and reflects its commitment to a future of growth and profitability. As of midmorning on Friday, shares of IAG were trading nearly 5% higher on the London Stock Exchange, signaling positive investor sentiment following the announcement..