And 2019 (+22%) Figures

Record 3Q23 Results For IAG, Revenues Of €8,646m, Comfortably Beating 2022 (+18%)

IAG Airlines.
IAG Airlines.

Intermoney : Better than ex­pected re­sults at all le­vels. Well ahead of 2022 and 2019 data. Capacity reaches 95.6% of that achieved in 2019, but higher ta­riffs allow im­pro­ve­ment on pre-­pan­demic re­sults.

  • Revenues of €8,646m, +18% vs 3Q22 and +19% vs 3Q19. Above our estimates (€8,351m) and below consensus (€8,832m).

  • EBIT of €1,745m, +45% vs. 3Q22 and +22% vs. 3Q19, reaching its historical record in a 3Q. Above both our estimates (€1,388m) and the consensus (€1,578m).

  • Net debt stands at €8,000m (1.4x EBITDA) vs €11,100m in 3Q22.

  • OUTLOOK 2023: Improved guidance

  • Expect to operate above 2019 levels in Q4 and by 2023 with capacity at around 97% of 2019 levels.

  • Around 75% of Q4 passenger revenues are already booked.

  • Expect fuel costs of around €7.6bn.

  • Net debt to rise in Q4 due to seasonal effect.

Assessment: Record results, again well above all estimates. It demonstrates the strength of the sector and the ability to maintain demand despite the sharp rise in tariffs, as well as presenting a good outlook for 4Q23.

We believe that at current prices it is an attractive opportunity. IAG trades at 2.9x EV/EBITDA and 4.5x PER. We maintain our Buy recommendation and P.O of €2.2.

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