IAG Cargo reports ‘challenging’ 2015
26 / 02 / 2016
IAG Cargo recorded a 3.2% rise in unadjusted 2015 full-year commercial revenue to just over €1bn as “challenging” market conditions saw like-for-like overall yield down 4% on prior year due to flat volumes while capacity grew by 3%.
However, after adjusting the prior year’s figures to reflect a directly comparable operation, 2015 commercial revenue at the cargo arm of British Airways, Iberia and newly acquired Aer Lingus decreased 4.6% versus 2014.
Drew Crawley, newly appointed chief executive at IAG Cargo, commented: “These are resilient results in the face of challenging market conditions, where excess capacity and reduced demand are leading to significant price and yield pressures.
“These structural changes to the market further reinforce our strategy of aggressive cost discipline coupled with a focus on growing our premium product offering.
Crawley added: “Despite an initial boost from the west coast port strike, 2015 was a year where the market forces of supply and demand became increasingly imbalanced.
“We have exercised strict capacity management where needed and grown our premium products through investing in infrastructure, network and expertise. Our premium product revenue growth is testament to this, with our express product growing 14% in 2015, and our pharmaceutical offering growing by 37%."
Crawley said that the 2015 results demonstrates IAG Cargo’s “determination” to maximise profitability, adding that the company’s new revenue management system, Optima, allows it to manage capacity and set price “more effectively”.
Continued Crawley: “It is by enacting sensible commercial policies like this that we are able to reinvest in our products and services. In 2016 we will be making major infrastructure announcements which will deliver next generation facilities and premium product experience for our customers.
“In addition we will launch key cargo destinations such as Lima, San Juan and, San Jose, California and San Jose, Costa Rica. We will also be completing the full integration of Aer Lingus Cargo, which will open previously unavailable markets and flows for our customers. “
He concluded: “IAG Cargo’s model and clear strategic direction has proven its worth in 2015 and we remain confident that the right strategy is in place for 2016.”