By Cristina Gallardo

British Airways owner International Consolidated Airlines Group posted higher net profit and revenue, driven by strong travel and premium cabin demand.

The group--which also houses airlines like Iberia, Vueling and Aer Lingus--said net profit was 3.34 billion euros ($3.94 billion) for 2025, compared with 2.73 billion euros a year prior.

Operating profit before exceptional items--the company's preferred metric, which strips out exceptional and other one-off items--rose 13.1% to 5.02 billion euros. That compares with a company-compiled consensus estimate of between 4.74 billion and 5.12 billion euros.

IAG said it benefited from strong travel demand and limited industry supply. The company had previously flagged pressure on economy flights to the U.S., but the strength of its premium cabin seats boosted its results.

The group increased its capacity by 2.4% in 2025, while passenger load factor, a measure of how full the planes fly, decreased 0.9 percentage point to 85.6%.

Revenue increased by 3.5% to 33.21 billion euros for the year.

The London-listed company said it would propose a final dividend for last year of 5 European cents a share, and repurchase shares worth 1.5 billion euros in the next 12 months, starting with a share buyback of 500 million euros to be completed by the end of May.

RBC Europe analysts said the value of the buyback was above the midpoint of expectations.

For this year, IAG expects revenue growth and earnings growth at high margins. The group's outlook for 2026 is positive, thanks to long-term demand, and will enable the company to deliver "significant further excess cash returns in future," IAG said.

Richard Hunter, head of markets at Interactive Investor, said that investors who chose to buy IAG shares in the aftermath of the Covid-19 pandemic have been rewarded.

"The arduous reparation from the ravages of the pandemic are all but complete, with the shares now having exceeded the record highs achieved in 2018," he said.

Write to Cristina Gallardo at cristina.gallardo@wsj.com

(END) Dow Jones Newswires

February 27, 2026 04:15 ET (09:15 GMT)

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