BA-owner IAG sees shares rise on improved outlook

International Consolidated Airlines Group SA (CDI)

Last Updated at 21 Feb 2018, 10:10 GMT *Chart shows local time International Consolidated Airlines Group SA (CDI) intraday chart
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IAG, the parent firm of British Airways and Iberia, saw its shares rise more than 5% in Friday trading after saying it expects higher profits over the next four years.

IAG raised its profit target for 2015 to 1.5bn euros (£1.3bn).

It added it would raise savings made by combining the two airlines from 400m to 450m euros per year.

The firm expects its transatlantic partnership with American Airlines to deliver at least 150m euros.

Analysts were cautiously positive about the announcement.

"This is a combination of strong marketing that has succeeded in pushing BA forward in the public mind after last year's industrial action but the real effect of global downturn is yet to impact," said BGC Partners analyst Howard Wheeldon.

"The upgraded synergy guidance and contribution expected from the American Airline venture are a positive," said Joshua Goldman from Davy Stockbrokers.

IAG was formed in January 2011 from a merger between British Airways and Iberia.

Last week, IAG announced that it was bidding to buy BMI from Germany's Lufthansa.

If the deal succeeds, it will increase IAG's number of slots at Heathrow, the world's busiest airport, from 45% to 54%.

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