While revenue was up at IAG cargo in 2012, volumes declined, with full-year results of 6.08 million tons showing a year-over-year decrease of 1.2 percent.
IAG Cargo saw a 19 million euro increase ($24.8 million) in revenue, year over year, during the fourth quarter of 2012, leading to a full-year revenue of 1.21 billon euros, a 2.3-percent revenue increase over 2011.
Capacity in the fourth quarter increased by 3.3 percent and was up 3.5 percent for the full year. Yield, however, rose by 8.5 percent during the quarter.
“Given the continued challenging economic backdrop, we have remained focused on the continuing integration and alignment of the business,” IAG Cargo’s Steve Gunning said in a statement. “In 2013, we will continue to deliver valuable network reach for our customers, offering user-friendly multi-channel distribution and providing an outstanding product portfolio.”
The entire IAG company experienced a 23 million euro operating loss for 2012 compared to a profit of 485 million euros in 2011. The loss stemmed from Iberia, which took a 351 million euro hit, a loss that was a little bit greater than British Airways 347 million euro profit.
Willie Walsh, the chief executive of IAG, pointed to 2012 as a year of transformation for IAG as a whole. The company bought bmi, integrating the carrier into British Airways, and initiated a restructuring of Iberia. IAG has started a 15 percent capacity cut at the airline and will terminate 3,807 jobs. Employees have already gone on strike this month and are planning two strike actions in March.
Even with all its troubles, Walsh called the company’s operating performance “solid” and said the 23 million euro loss was less than they had initially anticipated.
Walsh anticipates IAG will perform more in line with 2011’s results this year, but that uncertainty over the impact of Iberia’s transformation plan clouds the picture a bit.
"We have embarked on a significant transformation program in Iberia, and these results emphasize further that the airline must adapt to survive,” Walsh said in a statement. “It must stem its cash losses and adjust its cost base permanently if it is to compete with other airlines in all its strategic markets and lay the foundations for profitable growth in the future.” - Jon Ross