TIDMIAG
RNS Number : 0301G
International Cons Airlines Group
27 February 2015
FULL YEAR RESULTS ANNOUNCEMENT
International Consolidated Airlines Group (IAG) today (February
27, 2015) presented Group consolidated results for the year to
December 31, 2014.
IAG period highlights on results:
-- Fourth quarter operating profit EUR260 million (2013:
operating profit of EUR113 million) before exceptional items
-- Revenue for the quarter up 9.9 per cent to EUR5,015 million,
up 5.8 per cent at constant currency
-- Non-fuel unit costs for the quarter down 0.8 per cent at constant currency
-- Operating profit for the year to December 31, 2014 of
EUR1,390 million (2013: operating profit of EUR770 million) before
exceptional items
-- Revenue for the year up 8.0 per cent to EUR20,170 million and
passenger unit revenue for the year down 0.4 per cent at constant
currency
-- Fuel unit costs for the year down 7.8 per cent also down 7.8 per cent at constant currency.
-- Non-fuel unit costs before exceptional items for the year
down 1.9 per cent, down 3.9 per cent at constant currency
-- Cash of EUR4,944 million at December 31, 2014 was up EUR1,311 million on 2013 year end
-- Adjusted gearing up 1 point to 51 per cent and adjusted net
debt to EBITDAR improved 0.6 to 1.9 times
Performance summary:
Year to December 31
----------------------------
Financial data EUR million 2014 2013 Higher / (lower)
Passenger revenue 17,825 16,264 9.6 %
Total revenue 20,170 18,675 8.0 %
-------------------------------------------- ------------- ------------- -----------------
Operating profit before exceptional items 1,390 770 80.5 %
Exceptional items (361) (243) 48.6 %
-------------------------------------------- ------------- ------------- -----------------
Operating profit after exceptional items 1,029 527 95.3 %
Profit after tax 1,003 151 564.2 %
-------------------------------------------- ------------- ------------- -----------------
Basic earnings per share (EUR cents) 48.2 6.4 41.8pts
Operating figures 2014 2013 Higher / (lower)
Available seat kilometres (ASK million) 251,931 230,573 9.3 %
Seat factor (per cent) 80.4 80.8 (0.4pts)
-------------------------------------------- ------------- ------------- -----------------
Passenger unit revenue per ASK (EUR cents) 7.08 7.05 0.4 %
Non-fuel unit costs per ASK (EUR cents) 5.08 5.18 (1.9)%
-------------------------------------------- ------------- ------------- -----------------
December 31, December 31,
EUR million 2014 2013 Higher / (lower)
Cash and interest-bearing deposits 4,944 3,633 36.1 %
Adjusted net debt(1) 6,081 5,701 6.7 %
Adjusted net debt to EBITDAR 1.9 2.5 (0.6)
Adjusted gearing(2) 51% 50% 1pt
-------------------------------------------- ------------- ------------- -----------------
(1) Adjusted net debt is net debt plus capitalised operating
aircraft lease costs.
(2) Adjusted gearing is adjusted net debt, divided by adjusted
net debt and adjusted equity.
Willie Walsh, IAG Chief Executive Officer, said:
"We're reporting strong full year results with an operating
profit before exceptional items of EUR1,390 million which is up
80.5 per cent. Total revenue was up 8.0 per cent with non-fuel
costs up 7.0 per cent and fuel costs up 0.6 per cent on capacity
growth of 9.3 per cent.
"Iberia made an operating profit of EUR50 million compared to an
operating loss of EUR166 million last year. The airline's
turnaround has been remarkable, both financially and operationally,
and we're very proud of its achievement especially its strong cost
discipline. In 2013 we said our intention was for Iberia to
breakeven in 2014 and it has fulfilled that promise.
"British Airways' operating profit increased to EUR1,215 million
up from EUR762 million last year which shows significant progress
towards its long term targets. Vueling made an operating profit of
EUR141 million, compared to an operating profit of EUR139 million
in 2013, with the airline focusing on flexible growth.
"We achieved a strong unit cost performance, down 4.1 per cent,
through increased productivity, supplier cost savings and lower
fuel unit costs. The latter was boosted by the introduction of more
efficient aircraft into our fleet and lower fuel prices in the last
quarter of the year. However, the positive effect of the oil price
reduction has been partly offset by hedging and significant
currency impact.
"In the quarter, we made an operating profit before exceptional
items of EUR260 million which is up from EUR113 million last year.
Revenue for the quarter was up 9.9 per cent. Non-fuel costs were up
10.5 per cent and fuel costs decreased by 0.4 per cent on capacity
growth of 5.8 per cent."
Trading outlook
At current fuel prices and exchange rates, IAG expects in 2015
to generate an operating profit in excess of EUR2.2 billion, with
total fuel costs of around EUR5.9 billion, based on capacity growth
of approximately 5.5 per cent.
Forward-looking statements:
Certain statements included in this report are forward-looking
and involve risks and uncertainties that could cause actual results
to differ materially from those expressed or implied by such
forward-looking statements.
Forward-looking statements can typically be identified by the
use of forward-looking terminology, such as "expects", "may",
"will", "could", "should", "intends", "plans", "predicts",
"envisages" or "anticipates" and include, without limitation, any
projections relating to results of operations and financial
conditions of International Consolidated Airlines Group S.A. and
its subsidiary undertakings from time to time (the 'Group'), as
well as plans and objectives for future operations, expected future
revenues, financing plans, expected expenditures and divestments
relating to the Group and discussions of the Group's Business plan.
All forward-looking statements in this report are based upon
information known to the Group on the date of this report. The
Group undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
It is not reasonably possible to itemise all of the many factors
and specific events that could cause the forward-looking statements
in this report to be incorrect or that could otherwise have a
material adverse effect on the future operations or results of an
airline operating in the global economy. Further information on the
primary risks of the business and the risk management process of
the Group is given in the Annual Report and Accounts 2013; these
documents are available on www.iagshares.com.
IAG Investor Relations
2 World Business Centre Heathrow
Newall Road, London Heathrow Airport
HOUNSLOW TW6 2SF
Tel: +44 (0)208 564 2900
Investor.relations@iairgroup.com
CONSOLIDATED INCOME STATEMENT
Year to December 31
-------------------------------------------------------------------------------------
Before Before
exceptional exceptional
items items
Exceptional Exceptional Higher/
EUR million 2014 items Total 2014 2013 items Total 2013 (lower)
Passenger
revenue 17,825 17,825 16,264 (106) 16,158 9.6 %
Cargo revenue 992 992 1,073 1,073 (7.5)%
Other revenue 1,353 1,353 1,338 1,338 1.1 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Total revenue 20,170 20,170 18,675 (106) 18,569 8.0 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Employee costs 4,325 260 4,585 4,123 98 4,221 4.9 %
Fuel, oil
costs and
emissions
charges 5,987 5,987 5,951 (6) 5,945 0.6 %
Handling,
catering and
other
operating
costs 2,063 2,063 1,932 1,932 6.8 %
Landing fees
and en-route
charges 1,555 1,555 1,422 1,422 9.4 %
Engineering
and other
aircraft
costs 1,276 1,276 1,237 15 1,252 3.2 %
Property, IT
and other
costs 927 927 922 5 927 0.5 %
Selling costs 859 859 785 785 9.4 %
Depreciation,
amortisation
and
impairment 1,196 (79) 1,117 1,006 8 1,014 18.9 %
Aircraft
operating
lease costs 551 551 482 17 499 14.3 %
Currency
differences 41 180 221 45 45 (8.9)%
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Total
expenditure
on operations 18,780 361 19,141 17,905 137 18,042 4.9 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Operating
profit 1,390 (361) 1,029 770 (243) 527 80.5 %
Net
non-operating
costs (284) 83 (201) (283) (17) (300) 0.4 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Profit before
tax from
continuing
operations 1,106 (278) 828 487 (260) 227 127.1 %
Tax (238) 413 175 (57) (19) (76) 317.5 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Profit after
tax from
continuing
operations 868 135 1,003 430 (279) 151 101.9 %
Loss after tax
from
discontinued
operations - - - (4) (4) -
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Profit after
tax for the
year 868 135 1,003 430 (283) 147 101.9 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Operating Higher/
figures 2014 (1) 2013 (1) (lower)
Available seat
kilometres
(ASK million) 251,931 230,573 9.3 %
Revenue
passenger
kilometres
(RPK million) 202,562 186,304 8.7 %
Seat factor
(per cent) 80.4 80.8 (0.4pts)
Cargo tonne
kilometres
(CTK million) 5,453 5,653 (3.5)%
Passenger
numbers
(thousands) 77,334 67,224 15.0 %
Tonnes of
cargo carried
(thousands) 897 928 (3.3)%
Sectors
(thousands) 599,624 538,644 11.3 %
Block hours
(hours) 1,712,506 1,573,900 8.8 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Average
manpower
equivalent 59,484 60,089 (1.0)%
Aircraft in
service 459 431 6.5 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Passenger
revenue per
RPK (EUR
cents) 8.80 8.73 0.8 %
Passenger unit
revenue per
ASK (EUR
cents) 7.08 7.05 0.4 %
Cargo revenue
per CTK (EUR
cents) 18.19 18.98 (4.2)%
Fuel cost per
ASK (EUR
cents) 2.38 2.58 (7.8)%
Non-fuel unit
costs per ASK
(EUR cents) 5.08 5.18 (1.9)%
Total cost per
ASK (EUR
cents) 7.45 7.77 (4.1)%
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
(1) Financial ratios are before exceptional items.
CONSOLIDATED INCOME STATEMENT
Three months to December 31
-------------------------------------------------------------------------------------
Before Before
exceptional exceptional
items items
Exceptional Exceptional Higher/
EUR million 2014 items Total 2014 2013 items Total 2013 (lower)
Passenger
revenue 4,390 4,390 3,965 (106) 3,859 10.7 %
Cargo revenue 268 268 276 276 (2.9)%
Other revenue 357 357 321 321 11.2 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Total revenue 5,015 5,015 4,562 (106) 4,456 9.9 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Employee costs 1,143 260 1,403 1,048 (170) 878 9.1 %
Fuel, oil
costs and
emissions
charges 1,470 1,470 1,476 (1) 1,475 (0.4)%
Handling,
catering and
other
operating
costs 521 521 490 490 6.3 %
Landing fees
and en-route
charges 370 370 364 364 1.6 %
Engineering
and other
aircraft
costs 338 338 261 261 29.5 %
Property, IT
and other
costs 229 229 238 238 (3.8)%
Selling costs 189 189 176 176 7.4 %
Depreciation,
amortisation
and
impairment 326 (79) 247 262 262 24.4 %
Aircraft
operating
lease costs 146 146 127 (1) 126 15.0 %
Currency
differences 23 98 121 7 7 228.6 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Total
expenditure
on operations 4,755 279 5,034 4,449 (172) 4,277 6.9 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Operating
profit 260 (279) (19) 113 66 179 130.1 %
Net
non-operating
costs (106) 53 (53) (55) (55) 92.7 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Profit before
tax from
continuing
operations 154 (226) (72) 58 66 124 165.5 %
Tax (16) 397 381 (33) (17) (50) (51.5)%
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Profit after
tax from
continuing
operations 138 171 309 25 49 74 452.0 %
Loss after tax
from
discontinued
operations - - - (4) (4) -
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Profit after
tax for the
period 138 171 309 25 45 70 452.0 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Operating Higher/
figures 2014 2013 (lower)
Available seat
kilometres
(ASK million) 61,697 58,339 5.8 %
Revenue
passenger
kilometres
(RPK million) 49,025 46,084 6.4 %
Seat factor
(per cent) 79.5 79.0 0.5pts
Cargo tonne
kilometres
(CTK million) 1,430 1,503 (4.9)%
Passenger
numbers
(thousands) 18,427 16,770 9.9 %
Tonnes of
cargo carried
(thousands) 236 245 (3.7)%
Sectors
(thousands) 143,987 135,619 6.2 %
Block hours
(hours) 413,669 396,554 4.3 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Average
manpower
equivalent 58,814 59,026 (0.4)%
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Passenger
revenue per
RPK (EUR
cents) 8.95 8.60 4.1 %
Passenger unit
revenue per
ASK (EUR
cents) 7.12 6.80 4.7 %
Cargo revenue
per CTK (EUR
cents) 18.74 18.36 2.1 %
Fuel cost per
ASK (EUR
cents) 2.38 2.53 (5.9)%
Non-fuel unit
costs per ASK
(EUR cents) 5.32 5.10 4.3 %
Total cost per
ASK (EUR
cents) 7.71 7.63 1.0 %
---------------- ------------- -------------- ----------- ------------- ------------- ----------- -------------
Financial review:
IATA market growth
In 2014 industry passenger load factor reached 79.7 per cent
supported by stronger growth in demand rather than capacity
increases. International load factors have displayed a downward
trend throughout the year, particularly as a result of solid
capacity expansion in Asia Pacific carriers. In addition, there has
been a gradual easing in business confidence towards the end of
2014 which has weighed on some international travel in certain
markets.
Year to December 31, 2014 Capacity ASKs Traffic RPKs Passenger load factor Higher/ (lower)
--------------------------- -------------- ------------- ---------------------- ----------------
International 6.4% 6.1% 79.2 (0.1) pts
---------------------------- -------------- ------------- ---------------------- ----------------
Domestic 4.3% 5.4% 80.6 +0.7 pts
Total market 5.6% 5.9% 79.7 +0.2 pts
---------------------------- -------------- ------------- ---------------------- ----------------
IAG capacity
IAG increased capacity in 2014, measured in available seat
kilometres (ASKs), by 9.3 per cent. The increase was across all
regions, reflecting the full year impact of Vueling, the
restoration of routes as part of Iberia's Plan de Futuro and
changes to the British Airways network including up gauging related
to new fleet and additional flying from more efficient replacement
aircraft. Across the network, passenger load factor for the year
was 80.4 per cent; although a decrease of 0.4 points compared to
last year, it remains higher than IATA industry average of 79.7 per
cent.
Year to December 31, % of total network
2014 in ASKs ASKs higher/(lower) Passenger load factor Higher/ (lower)
---------------------- --------------------- -------------------- ---------------------- ----------------
Domestic 6.8% +21.6% 77.3 +1.6 pts
----------------------- --------------------- -------------------- ---------------------- ----------------
Europe 22.1% +18.6% 78.1 +0.5 pts
----------------------- --------------------- -------------------- ---------------------- ----------------
North America 29.2% +6.0% 83.1 (1.5) pts
----------------------- --------------------- -------------------- ---------------------- ----------------
Latin America and
Caribbean 17.4% +4.1% 81.4 (1.2) pts
----------------------- --------------------- -------------------- ---------------------- ----------------
Africa, Middle East
and South Asia 15.8% +5.3% 77.9 +0.4 pts
----------------------- --------------------- -------------------- ---------------------- ----------------
Asia Pacific 8.7% +8.1% 82.1 +0.7 pts
----------------------- --------------------- -------------------- ---------------------- ----------------
Total network 100.0% +9.3% 80.4 (0.4) pts
----------------------- --------------------- -------------------- ---------------------- ----------------
Market segments
In 2014, the IAG Domestic and European market capacity increases
reflect:
-- Full year impact of Vueling forming part of the IAG Group and
its year-over-year network growth;
-- Additional frequencies and new destinations for Iberia as part of the Plan de Futuro; and
-- More efficient replacement aircraft for British Airways at
London Gatwick and London City, increasing frequencies and
introducing new routes.
While the Domestic and European markets were very competitive
our passenger load factors improved in both regions, but remain
lower than the European average reported by IATA, influenced by the
growing presence of the low cost carriers.
North America continues to represent the largest part of the IAG
network and with the highest passenger load factor. At British
Airways, capacity increased primarily from up gauging aircraft with
the Airbus A380 flying to Washington D.C. and Los Angeles, and the
Boeing 787 on routes such as Newark, Philadelphia and Toronto. At
Iberia the increased capacity reflects additional frequencies to
Chicago and New York. IAG passenger load factor for North America
was down 1.5 points, consistent with the year-over-year decrease
reported by IATA. Despite the decrease in volume our unit revenues
improved.
Latin America and Caribbean capacity increase reflects
additional frequencies to Brazil and Mexico by both British Airways
and Iberia. As part of the Plan de Futuro Iberia has also restored
routes such as Santo Domingo and Montevideo and increased
frequencies to Panama. Passenger load factor in this region
decreased but overall remains high at 81.4 per cent.
Africa, Middle East and South Asia capacity increase primarily
reflects the up gauging of aircraft to the Airbus A380 on the
Johannesburg route and additional frequencies to Accra. Flying has
been reduced in North and West Africa by British Airways and Iberia
due to weakening demand resulting from the Ebola crisis and
political unrest. Passenger load factor improved 0.4 points.
In Asia Pacific, the capacity increase is driven by the full
year impact of routes added last year and the introduction of the
Airbus A380 to Hong Kong. In 2014, the Hyderabad and Chennai routes
see more capacity reflecting the up gauge to the Boeing 787.
Passenger load factors increased to 82.1, the second highest region
on the IAG network.
Acquisitions
The 2014 performance includes Vueling for the full year, however
the comparative period only includes Vueling results from the
acquisition date April 26, 2013.
Revenue
Passenger revenue
Passenger revenue for the Group increased 9.6 per cent for the
year on a capacity increase of 9.3 per cent. At constant currency
the increase was 8.7 per cent, with a unit revenue decrease of just
0.4 per cent. The Group carried 77 million passengers, up 15 per
cent from 2013.
At the Group level passenger revenue performance was based on
flat passenger yields (passenger revenue/revenue passenger
kilometre) at constant currency and a marginal decrease in load
factor of 0.4 points. The passenger yield performance was stronger
out of London, up 1.6 per cent benefitting from the continued
recovery of the UK economy, which grew by 2.6 per cent. Passenger
yields in Madrid and Barcelona were down by approximately 3 per
cent for the year, but with improvements in the fourth quarter as
Spain's economy started to strengthen.
From a market perspective, our revenue performance was strongest
in North America reflecting consumer confidence. Meanwhile Europe
and Domestic markets saw marginal declines in unit revenues
reflecting competition and IAG capacity changes. The World Cup,
political unrest, Ebola and the redeployment of Venezuela capacity
had a mildly dilutive effect on Latin America and Africa and Middle
East revenues.
Cargo revenue
In April 2014, IAG Cargo exited its longhaul freighter business
and formed a partnership with Qatar Airways to purchase capacity on
its air cargo freighters. While the new operating model reduces
total cargo revenue reported, it is more flexible and generates
better margins whilst maintaining the key trade lane between Hong
Kong and Europe. Cargo revenue for the year was down 7.5 per cent
or 6.6 per cent at constant currency. Excluding the longhaul
freighter business, volume measured in cargo tonne kilometres (CTK)
is up 6.7 per cent but with excess capacity in the market the
underlying yield per CTK is down 3.2 per cent at constant
currency.
Other revenue
Other revenue includes the BA Holidays programme, third party
maintenance and handling revenues, and aspects of the Avios
customer loyalty programme. Excluding the adverse impact on the
Group's handling and maintenance revenues due to the consolidation
of Vueling, other revenue increases approximately 10 per cent. Half
of this improvement is related to growth at BA Holidays, with the
remainder primarily from recovery of Iberia's maintenance and
handling activities. The Avios customer loyalty programme
performance is also increasing, benefitting from the increase in
the fair value of a point and an underlying improvement. A EUR67
million one-off charge was recorded in the fourth quarter of 2013
at the total revenue level.
Expenditure before exceptional items
Employee costs
Employee costs are up 4.9 per cent. At constant currency, total
employee costs are up 2.2 per cent and down 6.7 per cent on a unit
basis. On average the Group employed 59,484 people (measured in
average manpower equivalents 'MPE') a decrease of 1.0 per cent
versus last year driven by headcount reductions flowing through
from the Mediation Agreement reached by Iberia last year.
In 2014, Iberia reached further long-term labour agreements with
all its employee groups, resulting in an additional employee
restructuring charge of EUR260 million included as an exceptional
item. The new agreement allows 1,427 exits, in addition to the
original 3,141 from the Mediation Agreement. At British Airways
efficiency initiatives were implemented, including mixed fleet and
other productivity improvements. Vueling has increased productivity
through its growth however has incurred certain unit cost
increases, such as overnight expenses on international routes and
salary inflation under its new crew collective agreement.
Productivity increased 10.4 per cent for the Group, with
improvements at each airline.
Fuel, oil and emissions costs
Total fuel costs are up 0.6 per cent and up 0.9 per cent at
constant currency, on a 9.3 per cent capacity increase. Fuel unit
costs are down 7.8 per cent at constant currency (ccy), benefitting
from more efficient aircraft, improved operating procedures and
lower fuel prices net of hedging.
Lower fuel consumption per ASK has contributed to half of the
unit cost improvement for the year. This was driven by the fleet
replacement programme with the more efficient fleet types, such as
the Airbus A380, A320 family and Boeing 787. In addition, British
Airways and Iberia have implemented procedures during take-off and
landing which has lowered fuel consumption.
The US dollar foreign exchange impact on fuel costs net of
hedging for the first nine months has been positive for the Group
against the sterling and the euro. However, the strengthening of
the US dollar towards the end of the year has resulted in a net
adverse foreign currency impact on fuel for the fourth quarter.
Supplier costs
Total supplier costs for the year have increased by 6.0 per
cent. At constant currency and on a unit basis supplier costs were
reduced by 4.4 per cent. This is due to two main factors,
productivity and efficiency improvements across the Group, and the
final effects of consolidating Vueling in the Group (c. 2
points).
The Group's supplier unit cost performance was solid with
improvements at British Airways and Iberia, while Vueling was flat.
Through cost initiatives, joint procurement and the continued
benefit of the synergies programme, savings have been achieved,
including catering costs, lounge synergies and maintenance.
By supplier cost category:
Handling, catering and other operating costs increased 6.8 per
cent, with 1.5 points of adverse currency. The discontinuation of
the Cargo freighters reduced current year costs by c. 1.5 points.
The BA Holidays business raised costs by c. 3 points with
improvements in Other revenues. The underlying increase is related
to the additional capacity.
Landing fees and en-route charges were higher by 9.4 per cent,
with 1 point of adverse currency. The inflationary increase was on
average 2.5 per cent across the Group while the discontinuation of
Cargo freighters improved costs by c. 1 point. The remaining
increase is driven by higher capacity.
Engineering and other aircraft costs were up 3.2 per cent, with
1 point of adverse currency. The discontinuation of freighters and
the effect of Vueling consolidation improved the costs by c. 8
points. In the fourth quarter a EUR28 million (c. 2 points)
provision for the obsolescence of spare parts was recorded. The
remaining underlying increase reflects more aircraft and higher
flying hours, increases in third party maintenance and
inflation.
Property, IT and other costs are up 0.5 per cent but are down
excluding currency reflecting the Group's commitment to cost
control. Selling costs increased 9.4 per cent, with 1 point of
adverse currency impact, primarily from a higher number of
passenger bookings.
Ownership costs
The Group's ownership costs were up 17.4 per cent, with 3 points
of adverse currency. The increase is related to a higher
depreciation charge related to the Boeing 747s due to a reduction
in estimated useful life, with a year-over-year impact of EUR81
million (c. 6 points). The underlying rise in ownership costs
reflects inflation and an increase in owned and leased aircraft, up
6.5 per cent.
Operating result
The Group's operating profit, before exceptional items, for the
year was EUR1,390 million, a EUR620 million improvement from last
year. This improvement reflects the Group's approach to dealing
with significant capacity increases related to the delivery of new
aircraft and market opportunities, with a minimal negative impact
on unit revenues (at ccy) while benefitting from productivity
improvements, non-fuel cost savings and fuel cost reductions net of
hedging.
Non-operating costs
Net non-operating costs after exceptional items were EUR201
million, down from EUR300 million last year. The decrease is
related to:
-- Lower net finance costs since the conversion of the GBP350
million bond, reducing costs by EUR60 million;
-- Reduction in net finance charges for pensions of EUR49 million, due to lower deficit;
-- Increase in gain on the sale of the available for sale
financial assets of EUR91 million, primarily Amadeus;
Offset by:
-- Losses not qualifying for hedges and retranslation charges on
borrowings, a swing of EUR131 million over the prior year's credit
position.
Taxation
The majority of the Group's operations are taxed in the UK or
Spain. In 2014, the corporate tax rate in the UK decreased to 21
per cent (2013: decreased from 24 to 23 per cent) while the
corporate tax rate in Spain was 30 per cent (2013: 30 per
cent).
Excluding the impact of the tax rate change in Spain and the
recognition of a deferred tax asset related to prior period losses,
the Group's effective tax rate for the year is 22 per cent (2013: 8
per cent). The tax credit was EUR175 million (2013: EUR76 million
charge).
Profit after tax and earnings per share
The Group's profit after tax and after exceptional items was
EUR1,003 million (2013: EUR147 million), with earnings of 48.2 euro
cents per share (2013: 6.4) and 46.4 euro cents per fully diluted
share (2013: 6.3).
Exceptional items
For a full list of exceptional items, refer to note 3. Below is
a summary of the significant exceptional items recorded.
In 2014, net exceptional charges at the operating profit level
were EUR361 million (2013: EUR243 million). The exceptional charges
for the year include EUR260 million employee restructuring costs
related to Iberia's labour agreements, currency differences charge
of EUR180 million related to funds held in Venezuela, partially
offset by the reversal of the Iberia Brand impairment of EUR79
million.
A non-operating exceptional item was recognised on the gain on
sale of Amadeus of EUR83 million and for the recognition of
deferred tax assets, net of all other tax impacts on exceptional
items, of EUR413 million.
In 2013, exceptional charges included employee restructuring
costs at Iberia of EUR268 million, partially offset by reduced US
employee benefit obligations at British Airways of EUR170 million.
Iberia also recorded restructuring costs for aircraft of EUR44
million. The Group recognised net business combination credits of
EUR5 million related to Iberia and Vueling. In addition, there was
a charge to revenue of EUR106 million for the timing of the
recognition of deferred revenue. A non-operating loss on
acquisition was recognised of EUR17 million.
Exchange rates
Exchange rate movements are calculated by retranslating current
year results as though they had been generated at prior year
exchange rates. The reported results are impacted by translation
currency from converting British Airways' results from sterling to
the Group's reporting currency of euro. British Airways represents
approximately 70 per cent of the Group's revenues and operating
expenses which causes a significant variation year-over-year. From
a transaction perspective, the Group performance is impacted by the
fluctuation of exchange rates; primarily sterling, euro and US
dollar. The Group exchange rates used and the estimated impact of
translation and transaction exchange rates on operating profit
before exceptional items are set out as follows. At constant
currency, the Group's operating profit before exceptional items
would have been EUR1,459 million, EUR69 million higher than the
reported operating profit.
Exchange impact before exceptional items
EUR million Higher/(lower)
------------------------------------------------- ---------------
Reported revenue
Translation impact 688
--------------------------------------------------- ---------------
Transaction impact (523)
--------------------------------------------------- ---------------
Total exchange impact on revenue 165
--------------------------------------------------- ---------------
Reported operating expenditure
------------------------------------------------- ---------------
Translation impact (612)
Transaction impact 378
--------------------------------------------------- ---------------
Total exchange impact on operating expenditures (234)
-------------------------------------------------- ---------------
Reported operating profit
------------------------------------------------- ---------------
Translation impact 76
--------------------------------------------------- ---------------
Transaction impact (145)
Total exchange impact on operating profit (69)
-------------------------------------------------- ---------------
2014 Higher/ (lower)
------------- ----- ----------------
Translation
GBP to EUR 1.27 6.7%
------------- ----- ----------------
Transaction
GBP to EUR 1.24 5.1%
------------- ----- ----------------
EUR to $ 1.34 0.8%
------------- ----- ----------------
GBP to $ 1.65 5.8%
------------- ----- ----------------
Financial performance by Brand
British Airways operating profit was GBP975 million, a GBP324
million improvement over prior year. British Airways continued its
fleet replacement programme, with the delivery of five additional
Airbus A380s and four Boeing 787s. The increase in gauge of these
aircrafts is contributing in part to the 5.9 per cent rise in
capacity for the year. British Airways' strong result is based on
increasing revenues and a strong cost performance.
Iberia operating profit was EUR50 million, a EUR216 million
improvement over prior year. Iberia has made significant progress
during the year, resuming services and launching new routes.
Capacity for the year was up 3.6 per cent with a flat revenue
performance reflecting the competitiveness of the market. On the
cost side, Iberia has reduced costs in employee, fuel and supplier
reflecting the progress of its Plan de Futuro with its 30
initiatives across all key areas.
Vueling operating profit was EUR141 million, a EUR2 million
improvement over prior year. Vueling's focus in 2014 was on
flexible growth with capacity up 24 per cent, new bases in Brussels
and Rome, and a new collective agreement with crew. Vueling
introduced 20 additional aircraft by year end with a total fleet of
88. Revenue was up 22.0 per cent and operating margin was 8.2 per
cent.
British Airways Iberia Vueling
GBP million EUR million EUR million
-------------------------- ------------------------- ------------------
Higher/
2014 Higher/ (lower) 2014 Higher/ (lower) 2014 (lower)
------------------------------ -------- ---------------- ------- ---------------- ------- ---------
ASKs 170,917 5.9% 54,328 3.6% 26,686 24.2%
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Seat factor (per cent) 81.0 (0.3) pts 78.6 (0.5) pts 80.4 0.8 pts
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Passenger revenue 10,452 3.2% 3,178 (0.7)% 1,725 22.0%
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Cargo revenue 598 (13.2)% 253 (3.1)% - -
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Other revenue 669 10.9% 837 8.3% - -
---------
Total revenue 11,719 2.6% 4,268 0.8% 1,725 22.0%
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Fuel, oil costs and emissions
charges 3,515 (6.4)% 1,156 (4.8)% 488 20.5%
Employee costs 2,461 2.9% 1,035 (9.9)% 156 31.1%
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Supplier costs 3,857 1.1% 1,575 (1.1)% 755 23.8%
EBITDAR 1,886 29.4% 502 80.6% 326 16.4%
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Ownership costs 911 12.9% 452 1.8% 185 31.2%
Operating profit before
exceptional items 975 49.8% 50 130.1% 141 1.4%
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Passenger yield (pence or
cents/RPK) 7.55 (2.1)% 7.45 (3.4)% 8.04 (2.8)%
Unit passenger revenue (pence
or cents/ASK) 6.12 (2.4)% 5.85 (4.1)% 6.46 (1.8)%
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Total unit revenue (pence or
cents/ASK) 6.86 (3.0)% 7.86 (2.7)% 6.46 (1.8)%
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Fuel unit cost (pence or
cents/ASK) 2.06 (11.6)% 2.13 (8.2)% 1.83 (2.9)%
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Non-fuel unit costs (pence or
cents/ASK) 4.23 (2.7)% 5.64 (7.2)% 4.11 1.3%
Total unit cost (pence or
cents/ASK) 6.29 (5.7)% 7.76 (7.5)% 5.94 -
------------------------------- -------- ---------------- ------- ---------------- ------- ---------
Balance sheet
Property, plant and equipment and intangible assets
The increase in property, plant and equipment in 2014 is mostly
related to the Group's investment in aircraft. On balance sheet
fleet includes:
-- Delivery of 15 new aircraft, including five Airbus A380s,
four Boeing B787s, two Boeing B777-300s, three Airbus A320s and one
Embraer E190s;
-- Pre-delivery payments related to future deliveries;
-- Positive translation exchange; offset by
-- The sale and leaseback of three aircraft; and
-- Depreciation.
The intangible asset increase is primarily related to software
additions and the reversal of the Brand impairment.
Other non-current assets
British Airways' defined benefit pension plan assets increased
by EUR400 million from higher interest rates, offset by the sale of
Iberia's investment in Amadeus.
Shareholders' equity
In 2014, shareholders' equity decreased EUR424 million from
movements in other reserves. Profit after tax for the Group was
EUR1,003 million offset by adverse movements in the fair value of
cash flow hedges of approximately EUR1,235 million primarily
related to lower fuel prices, a net decrease mainly related to the
sale of Amadeus recycled to the income statement, an increase in
post-employment obligations of EUR400 million from a decrease in
corporate bond rates and a currency translation benefit of EUR168
million from the weaker euro.
Other non-current liabilities
Non-current liabilities are up due to the increase in the
British Airways defined benefit obligation, higher net derivative
liabilities from lower fuel prices and an increase in provisions
for Iberia's current year restructuring charge. These impacts were
partially offset by a reduction in the deferred tax liability
balance from the recognition of Iberia's deferred tax asset.
In respect of cash, cash equivalents and interest-bearing
deposits and interest-bearing long-term borrowings, see Liquidity
and capital resources.
Liquidity and capital resources
The primary source of the Group's liquidity over the past two
years has been cash generated from operations.
In 2014 cash generated from operations increased to EUR1,862
million from EUR1,218 million. The improvement in the year is
proportionate to the increase in operating results achieved by the
Group. The cash flows generated from operating activities is after
payments made to pension schemes of EUR409 million, and after
interest and tax payments of EUR277 million.
Net cash flow from investing activities
The Group invested EUR2.6 billion in fixed assets during the
year, primarily represented by fleet transactions and increased its
current interest-bearing deposits by EUR1.4 billion. The sale of
Iberia's investment in Amadeus generated net proceeds of EUR572
million.
Net cash flow from financing activities
The Group's proceeds from long term borrowings relates to
aircraft delivery in the year, and includes $431 million drawn down
from the Enhanced Equipment Trust Certificates (EETC) issued in
2013. In addition, debt repayments of EUR1 billion were made during
the year.
Cash, cash equivalents and interest-bearing deposits
At December 31 the Group's cash position improved by EUR1,311
million, generated from the Group's operating activities and the
sale of Amadeus. The net cash flows from operations covered the
repayment of borrowings including finance leases; funded the
acquisition of some fleet and all non-fleet assets; and contributed
to the current year increase in cash.
Liquidity risk management
Adequate cash levels are maintained by each operating company.
The cash balance at December 31, 2014 comprised EUR3,206 million
held by British Airways, EUR870 million held by Iberia, EUR651
million held by Vueling and EUR217 million held by the parent and
other Group companies.
In addition, the Group had undrawn general and committed
aircraft financing facilities (primarily available in US dollars)
in euro equivalent of EUR2,975 million (2013: EUR3,686 million).
The Group also had undrawn overdraft facilities of EUR13 million
(2013: EUR12 million) and undrawn uncommitted money market lines of
EUR32 million (2013: EUR30 million).
Capital risk management
IAG's objectives when managing capital are to safeguard the
Group's ability to continue as a going concern, to maintain an
optimal capital structure in order to reduce the cost of capital,
and to prepare the Group to provide future returns to shareholders.
The Group monitors capital using the adjusted gearing and adjusted
net debt to EBITDAR.
The Group's cash increased EUR1,311 million during the year due
to improved cash flows from operations. Net financing was up
EUR1,000 million and reflects the draw down on the remaining EETC
and refinancing of the Iberbond. Including adverse exchange and
other non-cash movements of EUR495 million, the Group's net debt
was EUR184 million higher. Adjusted net debt was up EUR380 million
reflecting the increase in net debt and the additional off balance
sheet operating leases.
Excluding the remeasurement of employment benefit obligations,
IAG's total adjusted shareholders equity for the year was broadly
flat, with the profit after tax offset by the fair value movements
on cash flow hedges. Combined with the increase in adjusted net
debt, this drives adjusted gearing up 1 point to 51 per cent.
Adjusted net debt to EBITDAR improves 0.6 to 1.9 times.
Net debt
EUR million 2014 2013 Higher / (lower)
--------------------------------------------------------------------------- -------- -------- -----------------
Decrease in cash and cash equivalents during the year (excluding Business
combination) (13) (114) 101
Increase in other current interest-bearing deposits 1,324 532 792
--------------------------------------------------------------------------- -------- -------- -----------------
Net funds acquired through Business combination - 306 (306)
--------------------------------------------------------------------------- -------- -------- -----------------
Increase in cash net of exchange 1,311 724 587
--------------------------------------------------------------------------- -------- -------- -----------------
Net cash outflow from repayments of debt and lease financing 1,009 677 332
--------------------------------------------------------------------------- -------- -------- -----------------
New borrowings and finance leases (2,009) (1,529) (480)
--------------------------------------------------------------------------- -------- -------- -----------------
Increase in net debt resulting from financing cash flows (1,000) (852) (148)
--------------------------------------------------------------------------- -------- -------- -----------------
Exchange movements and other non-cash movements (495) 528 (1,023)
--------------------------------------------------------------------------- -------- -------- -----------------
(Increase)/decrease in net debt during the year (184) 400 (584)
--------------------------------------------------------------------------- -------- -------- -----------------
Net debt at January 1 (1,489) (1,889) 400
Net debt at December 31 (1,673) (1,489) (184)
--------------------------------------------------------------------------- -------- -------- -----------------
Capital commitments and off balance sheet arrangements
Capital expenditure authorised and contracted for amounted to
EUR9,027 million (2013: EUR8,745 million) for the Group. The
majority of this is in US dollars and includes commitments until
2021 for 88 aircraft from the Airbus A320 family, 34 Boeing 787s,
26 Airbus A350s, eight Airbus A330s and four Airbus A380s.
IAG does not have any other off-balance sheet financing
arrangements that currently have or are reasonably likely to have a
material future effect on the Group's financial condition, changes
in financial condition, results of operations, liquidity, capital
expenditure or capital resources.
Strategic framework
Our mission is to be the leading international airline Group.
This means we will:
-- Win the customer through service and value across our global network;
-- Deliver higher returns to our shareholders through leveraging
cost and revenue opportunities across the Group;
-- Attract and develop the best people in the industry;
-- Provide a platform for quality international airlines,
leaders in their markets, to participate in consolidation;
-- Retain the distinct cultures and brands of individual airlines.
By accomplishing our mission, IAG will help to shape the future
of the industry, set new standards of excellence and provide
sustainability, security and growth.
IAG's six core strategic objectives are:
-- Leadership in IAG's main cities;
-- Leadership across the Atlantic;
-- Stronger Europe-to-Asia position in critical markets;
-- Grow share of Europe-to-Africa routes;
-- Stronger intra-Europe profitability; and
-- Competitive cost positions across our businesses.
Principal risks and uncertainties
The 2013 Annual Report and Accounts refers to a risk of
retaliatory action from Non-EU governments should the EU extend
their Emissions Trading Scheme (EU ETS) from just intra EU flights
to all flights through EU airspace. This risk was mitigated in 2014
by the EU's restriction of EU ETS to intra-European flights until
the end of 2016. This EU move was in response to progress made by
the International Civil Aviation Organisation (ICAO) in developing
a roadmap for a global market based mechanism to tackle aviation
emissions.
The 2013 Annual Report and Accounts refers to residual Iberia
Transformation risks related to receiving union general assembly
approval of negotiated agreements and the refinancing of 16 Airbus
A320 aircraft. During 2014 the required union approval was obtained
and the aircraft refinancing successfully executed.
Iberia continues to experience problems in repatriating cash
balances held in Venezuela with all balances relating to 2013
receipts and seven months of 2014 receipts being trapped in
Venezuela. An exceptional charge has been recognised in the year
revaluing the cash balance to better reflect the economic reality,
and is explained in note 3.
INTERNATIONAL CONSOLIDATED AIRLINES GROUP S.A.
Unaudited Full year Condensed Consolidated Financial
Statements
January 1, 2014 - December 31, 2014
CONSOLIDATED INCOME
STATEMENT
Year to December 31
----------------------------------------------------------------------------------------------
Before Before
exceptional Exceptional exceptional Exceptional
EUR million items 2014 items Total 2014 items 2013 items Total 2013
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
Passenger revenue 17,825 17,825 16,264 (106) 16,158
Cargo revenue 992 992 1,073 1,073
Other revenue 1,353 1,353 1,338 1,338
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
Total revenue 20,170 20,170 18,675 (106) 18,569
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
Employee costs 4,325 260 4,585 4,123 98 4,221
Fuel, oil costs and
emissions charges 5,987 5,987 5,951 (6) 5,945
Handling, catering
and other
operating costs 2,063 2,063 1,932 1,932
Landing fees and
en-route charges 1,555 1,555 1,422 1,422
Engineering and
other aircraft
costs 1,276 1,276 1,237 15 1,252
Property, IT and
other costs 927 927 922 5 927
Selling costs 859 859 785 785
Depreciation,
amortisation and
impairment 1,196 (79) 1,117 1,006 8 1,014
Aircraft operating
lease costs 551 551 482 17 499
Currency
differences 41 180 221 45 45
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
Total expenditure
on operations 18,780 361 19,141 17,905 137 18,042
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
Operating profit 1,390 (361) 1,029 770 (243) 527
Finance costs (237) (237) (301) (301)
Finance income 32 32 31 31
Retranslation
(charges)/credits
on currency
borrowings (27) (27) 12 12
(Losses)/gains on
derivatives not
qualifying for
hedge accounting (49) (49) 43 43
Net gain related to
available-for-sale
financial assets 10 83 93 2 2
Share of post-tax
profits/(losses)
in associates 2 2 (8) (8)
Loss on sale of
property, plant
and equipment and
investments (11) (11) (9) (17) (26)
Net financing
charge relating to
pensions (4) (4) (53) (53)
Profit before tax
from continuing
operations 1,106 (278) 828 487 (260) 227
Tax (238) 413 175 (57) (19) (76)
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
Profit after tax
from continuing
operations 868 135 1,003 430 (279) 151
Loss after tax from
discontinued
operations - - - (4) (4)
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
Profit after tax
for the year 868 135 1,003 430 (283) 147
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
Attributable to:
Equity holders of
the parent 847 982 405 122
Non-controlling
interest 21 21 25 25
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
868 1,003 430 147
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
Basic earnings per
share (EUR cents)
From continuing
operations 41.6 48.2 21.3 6.6
From discontinued
operations - - - (0.2)
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
From profit for the
year 41.6 48.2 21.3 6.4
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
Diluted earnings
per share (EUR
cents)
From continuing
operations 40.2 46.4 20.8 6.5
From discontinued
operations - - - (0.2)
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
From profit for the
year 40.2 46.4 20.8 6.3
-------------------- --------------- ---------------- ----------- --------------- ---------------- -----------
CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
Year to December 31
----------------------
EUR million 2014 2013
----------------------------------------------------------------------------- ------------ --------
Items that may be reclassified subsequently to net profit
Cash flow hedges:
Fair value movements in equity (1,235) (203)
Reclassified and reported in net profit 357 36
Available-for-sale financial assets:
Fair value movements in equity 29 297
Reclassified and reported in net profit (359) (3)
Currency translation differences 168 (20)
Items that will not be reclassified to net profit
Remeasurements of post-employment benefit obligations (394) 521
----------------------------------------------------------------------------- ------------ --------
Total other comprehensive income for the year, net of tax (1,434) 628
----------------------------------------------------------------------------- ------------ --------
Profit after tax for the year 1,003 147
Total comprehensive income for the year (431) 775
----------------------------------------------------------------------------- ------------ --------
Total comprehensive income is attributable to:
Equity holders of the parent (452) 750
Non-controlling interest 21 25
----------------------------------------------------------------------------- ------------ --------
(431) 775
----------------------------------------------------------------------------- ------------ --------
Total comprehensive income attributable to equity shareholders arises from:
Continuing operations (452) 754
Discontinued operations - (4)
----------------------------------------------------------------------------- ------------ --------
Items in the consolidated Statement of other comprehensive income above are disclosed net
of tax.
CONSOLIDATED BALANCE SHEET
EUR million December 31, 2014 December 31, 2013
----------------------------------------- ------------------ ------------------
Non-current assets
Property, plant and equipment 11,784 10,228
Intangible assets 2,438 2,196
Investments in associates 27 25
Available-for-sale financial assets 84 1,092
Employee benefit assets 855 485
Derivative financial instruments 80 35
Deferred tax assets 769 501
Other non-current assets 188 197
----------------------------------------- ------------------ ------------------
16,225 14,759
----------------------------------------- ------------------ ------------------
Current assets
Non-current assets held for sale 18 12
Inventories 424 411
Trade receivables 1,252 1,196
Other current assets 611 631
Derivative financial instruments 178 135
Other current interest-bearing deposits 3,416 2,092
Cash and cash equivalents 1,528 1,541
----------------------------------------- ------------------ ------------------
7,427 6,018
----------------------------------------- ------------------ ------------------
Total assets 23,652 20,777
----------------------------------------- ------------------ ------------------
Shareholders' equity
Issued share capital 1,020 1,020
Share premium 5,867 5,867
Treasury shares (6) (42)
Other reserves (3,396) (2,936)
----------------------------------------- ------------------ ------------------
Total shareholders' equity 3,485 3,909
----------------------------------------- ------------------ ------------------
Non-controlling interest 308 307
----------------------------------------- ------------------ ------------------
Total equity 3,793 4,216
----------------------------------------- ------------------ ------------------
Non-current liabilities
Interest-bearing long-term borrowings 5,904 4,535
Employee benefit obligations 1,324 738
Deferred tax liability 278 884
Provisions for liabilities and charges 1,967 1,796
Derivative financial instruments 359 66
Other long-term liabilities 226 225
----------------------------------------- ------------------ ------------------
10,058 8,244
----------------------------------------- ------------------ ------------------
Current liabilities
Current portion of long-term borrowings 713 587
Trade and other payables 3,281 3,297
Deferred revenue on ticket sales 3,933 3,496
Derivative financial instruments 1,313 528
Current tax payable 57 11
Provisions for liabilities and charges 504 398
----------------------------------------- ------------------ ------------------
9,801 8,317
----------------------------------------- ------------------ ------------------
Total liabilities 19,859 16,561
----------------------------------------- ------------------ ------------------
Total equity and liabilities 23,652 20,777
----------------------------------------- ------------------ ------------------
CONSOLIDATED CASH FLOW STATEMENT
Year to December 31
----------------------
EUR million 2014 2013
------------------------------------------------------------------------------- ---------- ----------
Cash flows from operating activities
Operating profit(1) 1,029 527
Depreciation, amortisation and impairment 1,117 1,014
Movement in working capital and other non-cash movements(1) 426 320
Settlement of competition investigation (9) (32)
Employer contributions to pension schemes (612) (577)
Pension scheme service costs 203 205
Interest paid (159) (163)
Taxation (118) (34)
------------------------------------------------------------------------------- ---------- ----------
Net cash flows from operating activities from continuing operations 1,877 1,260
------------------------------------------------------------------------------- ---------- ----------
Net cash flows used in operating activities from discontinued operations (15) (42)
------------------------------------------------------------------------------- ---------- ----------
Net cash flows from operating activities 1,862 1,218
------------------------------------------------------------------------------- ---------- ----------
Cash flows from investing activities
Acquisition of property, plant and equipment and intangible assets (2,622) (2,196)
Sale of property, plant and equipment and intangible assets 404 525
Net proceeds from sale of investments 589 -
Cash acquired on Business combination (net of consideration) - 293
Interest received 37 27
Increase in other current interest-bearing deposits (1,352) (593)
Dividends received 2 3
Other investing movements 12 6
------------------------------------------------------------------------------- ---------- ----------
Net cash flows from investing activities (2,930) (1,935)
------------------------------------------------------------------------------- ---------- ----------
Cash flows from financing activities
Proceeds from long-term borrowings 2,009 1,529
Proceeds from equity portion of convertible bond issued - 72
Repayment of borrowings (223) (275)
Repayment of finance leases (786) (402)
Acquisition of treasury shares (23) (42)
Acquisition of non-controlling interest - (24)
Distributions made to holders of perpetual securities (20) (20)
------------------------------------------------------------------------------- ---------- ----------
Net cash flows from financing activities 957 838
------------------------------------------------------------------------------- ---------- ----------
Net (decrease)/increase in cash and cash equivalents (111) 121
Net foreign exchange differences 98 58
Cash and cash equivalents at 1 January 1,541 1,362
------------------------------------------------------------------------------- ---------- ----------
Cash and cash equivalents at year end 1,528 1,541
------------------------------------------------------------------------------- ---------- ----------
Interest-bearing deposits maturing after more than three months(1) 3,416 2,092
------------------------------------------------------------------------------- ---------- ----------
Cash, cash equivalents and other interest-bearing deposits 4,944 3,633
------------------------------------------------------------------------------- ---------- ----------
(1) A charge of EUR180 million has been recorded in the year related to Venezuela funds (note
3).
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year to December 31, 2014
EUR million Issued Total
share Share Treasury Other shareholders' Non-controlling Total
capital premium shares reserves(1) equity interest equity
----------------- ---------- ----------- ----------- -------------- -------------- ---------------- -----------
January 1, 2014 1,020 5,867 (42) (2,936) 3,909 307 4,216
Total
comprehensive
income for the
year (net of
tax) - - - (452) (452) 21 (431)
Cost of
share-based
payments - - - 38 38 - 38
Vesting of
share-based
payment schemes - - 59 (46) 13 - 13
Acquisition of
treasury shares - - (23) - (23) - (23)
Distributions
made to holders
of perpetual
securities - - - - - (20) (20)
----------------- ---------- ----------- ----------- -------------- -------------- ---------------- -----------
December 31,
2014 1,020 5,867 (6) (3,396) 3,485 308 3,793
----------------- ---------- ----------- ----------- -------------- -------------- ---------------- -----------
(1) Closing balance includes a retained deficit of EUR234 million (excluding pensions restatement:
retained earnings of EUR1,815 million).
For the year to December 31, 2013
Issued Total
share Share Treasury Other shareholders' Non-controlling Total
EUR million capital premium shares reserves(1) equity interest equity
----------------- ---------- ----------- ----------- -------------- -------------- ---------------- -----------
January 1, 2013 928 5,280 (17) (1,436) 4,755 300 5,055
Restatement - - - (2,077) (2,077) - (2,077)
----------------- ---------- ----------- ----------- -------------- -------------- ---------------- -----------
January 1, 2013
(restated) 928 5,280 (17) (3,513) 2,678 300 2,978
Total
comprehensive
income for the
year (net of
tax) - - - 750 750 25 775
Cost of
share-based
payments - - - 30 30 - 30
Exercise of
share options - - 17 (9) 8 - 8
Acquisition of
treasury shares - - (42) - (42) - (42)
Equity portion
of convertible
bond issued - - - 72 72 - 72
Non-controlling
interest
arising on
Business
combination - - - - - 26 26
Acquisition of
non-controlling
interest - - - - - (24) (24)
Issue of
ordinary shares
related to
conversion of
convertible
bond 92 587 - (266) 413 - 413
Distributions
made to holders
of perpetual
securities - - - - - (20) (20)
----------------- ---------- ----------- ----------- -------------- -------------- ---------------- -----------
December 31,
2013 1,020 5,867 (42) (2,936) 3,909 307 4,216
----------------- ---------- ----------- ----------- -------------- -------------- ---------------- -----------
(1) Closing balance includes a retained deficit of EUR814 million (excluding pensions restatement:
retained earnings of EUR1,235 million).
1. Corporate Information AND BASIS OF PREPARATION
International Consolidated Airlines Group S.A. (hereinafter
'International Airlines Group', 'IAG' or the 'Group') is a leading
European airline group, formed to hold the interests of airline and
ancillary operations. IAG is a Spanish company registered in Madrid
and was incorporated on April 8, 2010. On January 21, 2011 British
Airways Plc and Iberia LÃneas Aéreas de España S.A. Operadora
(hereinafter 'British Airways' and 'Iberia' respectively) completed
a merger transaction becoming the first two airlines of the Group.
Vueling Airlines S.A. ('Vueling') was acquired on April 26,
2013.
IAG shares are traded on the London Stock Exchange's main market
for listed securities and also on the stock exchanges of Madrid,
Barcelona, Bilbao and Valencia (the 'Spanish Stock Exchanges'),
through the Spanish Stock Exchanges Interconnection System (Mercado
Continuo Español).
The Group's full year condensed consolidated financial
statements for the year to December 31, 2014 were prepared in
accordance with IAS 34 and authorised for issue by the Board of
Directors on February 26, 2015. The condensed financial statements
herein are not the Company's statutory accounts and are unaudited.
The Directors consider that the Group has adequate resources to
remain in operation for the foreseeable future and have therefore
continued to adopt the going concern basis in preparing the
condensed financial statements.
The basis of preparation and accounting policies set out in the
IAG Annual Report and Accounts for the year to December 31, 2013
have been applied in the preparation of these condensed
consolidated financial statements, except as disclosed in note 2.
IAG's financial statements for the year to December 31, 2013 have
been filed with the Registro Mercantil de Madrid, and are in
accordance with the International Financial Reporting Standards as
adopted by the European Union (IFRSs as adopted by the EU) and with
those of the Standing Interpretations issued by the International
Financial Reporting Interpretations Committee (IFRIC) of the
International Accounting Standards Board (IASB). The report of the
auditors on those financial statements was unqualified.
2. Accounting Policies
The Group has adopted the following standards, interpretations
and amendments for the first time in the year to December 31,
2014:
IFRS 10 'Consolidated financial statements', IFRS 11 'Joint
arrangements' and IFRS 12 'Disclosure of interest in other
entities'; effective for periods beginning on or after January 1,
2014. IFRS 10 replaces the guidance on control and consolidation in
IAS 27 and SIC 12 'Consolidation-special purpose entities'. IFRS 11
requires joint arrangements to be accounted for as a joint
operation or as a joint venture depending on the rights and
obligations of each party to the arrangement. IFRS 12 requires
enhanced disclosure of the nature, risk and the financial effects
associated with the Group's interest in subsidiaries, associates,
joint arrangements and unconsolidated structured entities. The core
principle that a consolidated entity presents a parent and its
subsidiaries as if they were a single entity remains unchanged, as
do the mechanics of consolidation. The application of these
standards have no impact on the Group's net result or net
assets.
IAS 32 (Amendment) 'Financial instruments: Presentation';
effective for periods beginning on or after January 1, 2014. The
amendment clarifies some of the requirements for offsetting
financial assets and financial liabilities on the balance sheet.
The application of this standard has no significant impact on the
Group's net result or net assets.
IAS 36 (Amendment) 'Impairment of assets'; effective for periods
beginning on or after January 1, 2014. The amendment addresses the
disclosure of information about the recoverable amount of impaired
assets if that amount is based on fair value less costs of
disposal. The standard requires a change in the presentation of the
Group's notes to the financial statements but has no impact on the
Group's net result or net assets.
IAS 39 (Amendment) 'Financial instruments: Recognition and
measurement'; effective for periods beginning on or after January
1, 2014. The amendment provides relief from discontinuing hedge
accounting when novation of a hedging instrument to a central
counterparty meets specific criteria. The application of this
standard has no impact on the Group's net result or net assets.
Other amendments resulting from improvements to IFRSs did not
have any impact on the accounting policies, financial position or
performance of the Group. The Group has not early adopted any
standard, interpretation or amendment that has been issued but is
not yet effective.
3. Exceptional items
Year to December 31
----------------------
EUR million 2014 2013
-------------------------------------------------- ---------- ----------
Foreign currency loss(1) 180 -
Restructuring costs - employee(2) 260 268
Restructuring costs - aircraft(2) - 44
Reversal of Iberia Brand impairment(3) (79) -
Business combination costs(4) - 5
Pre-acquisition cash flow hedge impact(5) - (10)
Revision in US past service cost benefits(6) - (170)
Customer loyalty programme change in estimate(7) - 106
--------------------------------------------------- ---------- ----------
Recognised in expenditure on operations 361 243
--------------------------------------------------- ---------- ----------
Gain on sale of available-for-sale asset(8) (83) -
Loss on step acquisition(9) - 17
--------------------------------------------------- ---------- ----------
Total exceptional charge before tax 278 260
--------------------------------------------------- ---------- ----------
Loss on discontinued operations(10) - 4
Tax on exceptional items (144) 19
Net deferred tax credit(11) (269) -
-------------------------------------------------- ---------- ----------
Total exceptional (credit)/charge after tax (135) 283
--------------------------------------------------- ---------- ----------
(1) Foreign currency loss
Since December 2012 repatriation of funds from Venezuela has
been limited. Throughout 2013, Iberia recognised net sales at 6.3
bolÃvares (CADIVI) to the US dollar. The unrepatriated cash at the
end of 2013 was EUR184 million.
From February to October 2014, Iberia recognised net sales at 11
bolÃvares to the US dollar (SICAD I) since this was the official
rate at which Iberia was authorised by the Venezuelan government to
repatriate cash. In the third quarter of 2014, Iberia received
funds for February to June 2014 at SICAD I and given the ongoing
negotiations, the EUR184 million of unrepatriated funds from 2013
and January 2014 were also revalued to SICAD I. An exceptional
charge of EUR82 million was recognised.
Iberia has been unable to repatriate any further funds earned
prior to February 2014 or subsequent to June 2014. Given this and
combined with the lack of liquidity in Venezuela, the decrease in
the Brent barrel price and a government recognised inflation rate
of 65 per cent, Iberia has determined that SICAD I can no longer be
considered available in practice, for the repatriation of the
funds. The next alternative rate available at December 31, 2014 was
the SICAD II rate of 50 bolÃvares to the US dollar which Iberia
considers to better reflect the economic reality. This rate has
been applied since November 2014. All remaining funds, which
approximately amount to Bs 1.7 billion were revalued to SICAD II
resulting in an additional exceptional charge of EUR98 million. The
cash balance at December 31, 2014 is EUR18 million.
In February 2015 the Venuezuelan government has approved changes
to the country's currency exchange systems through new foreign
exchange regulations. These changes include replacing SICAD II with
SIMADI, a new mechanism to trade US dollars through private brokers
that is expected to compete with the illegal parallel market. Using
the new SIMADI rates would represent a further write down. Iberia
has not used SIMADI rates since these were not available at the
balance sheet date.
A related tax credit of EUR54 million was recognised.
(2) Restructuring costs
In the year to December 31, 2014, a restructuring expense of
EUR260 million has been recognised in relation to the Iberia
Transformation Plan and the agreement on collective redundancies
for pilots and ground staff. A related tax credit of EUR78 million
was recognised.
In the year to December 31, 2013, a restructuring expense of
EUR312 million was recognised in relation to the Iberia
Transformation Plan. EUR265 million of additional employee
restructuring costs were charged to reflect the increased cost of
the severance as proposed by the mediator agreement. Restructuring
costs of EUR47 million associated with the return of leased
aircraft and standing down owned aircraft were also recorded in the
comparative period. No deferred tax was recognised.
(3) Reversal of Iberia Brand impairment
In 2014 the partial impairment of the Iberia Brand of EUR79
million was reversed (note 12). This follows Iberia's return to
profitability and the approval of Iberia's Business plan. A related
tax charge of EUR24 million was recognised.
(4) Business combination costs
Transaction expenses of EUR5 million were recognised in relation
to the Vueling Business combination in the year to December 31,
2013.
3. EXCEPTIONAL ITEMS continued
(5) Derivatives and financial instruments
On January 21, 2011, Iberia had a portfolio of cash flow hedges
with a net mark-to-market charge of EUR67 million recorded within
Other reserves on the Balance sheet. On April 26, 2013, Vueling had
a portfolio of cash flow hedges with a net mark-to-market charge
which rounds to nil recorded within Other reserves in the Balance
sheet. As these cash flow hedge positions unwind, Iberia and
Vueling will recycle the impact from Other reserves through their
respective Income statement.
The Group does not recognise the pre-acquisition cash flow hedge
net position on the Balance sheet, resulting in fuel and aircraft
operating lease costs being gross of the pre-acquisition cash flow
hedge positions. For the year to December 31, 2013 this resulted in
a decrease in reported aircraft operating lease costs of EUR4
million, a decrease in reported fuel expense of EUR6 million and a
related EUR3 million tax charge.
(6) Revision in US past service cost benefits
The Group made changes to the US PRMB (Post-Retirement Medical
Benefits) during 2013 to bring the level of benefits in line with
national trends in the US. This scheme is accounted for in a
similar way to a defined benefit plan. Any reduction in benefits
provided would result in a recognition of a past service gain when
the plan amendment occurs. This change resulted in a recognition of
a one-off gain in employee costs of EUR170 million during the year
to December 31, 2013, and a related deferred tax charge of EUR39
million.
(7) Customer loyalty programme change in estimate
During 2013, management revised estimates relating to the
customer loyalty programme revenue, recognised on redemption.
Historically, management information systems have provided a
constraint on the reliability of revenue recognition at the point
of departure. As part of a Group-wide exercise to review the
existing customer loyalty programmes, reporting has been developed
to better estimate the revenue that should be deferred to departure
and so this new management information was adopted during the year
to December 31, 2013 giving rise to a reduction in passenger
revenue of EUR106 million, and a related tax credit of EUR23
million.
(8) Gain on sale of available-for-sale asset
During the third quarter of 2014, Iberia entered into an
agreement to settle its hedging transaction over its ownership
interest in Amadeus IT Holding S.A. ('Amadeus') and sell its entire
shareholding. The derivative transaction comprised a collar
arrangement on Iberia's Amadeus shareholding of 33,562,331 ordinary
shares.
The settlement of the derivative contract commenced in August
2014 and the Group's shareholding in Amadeus has been sold in equal
instalments over a 100 trading day period. At December 31, 2014
Iberia had settled 99 per cent of the transaction and the resulting
EUR83 million gain was recognised in the Net gain related to
available-for-sale financial assets line. A related EUR36 million
tax credit was also recognised.
(9) Loss on step acquisition
As a result of Iberia's initial investment in Vueling, the
Business combination was achieved in stages. The Group revalued its
initial investment in Vueling to fair value at the acquisition date
resulting in a non-cash loss of EUR17 million recognised in the
Loss on sale of property, plant and equipment and investments line
in the year to December 31, 2013.
(10) Loss on discontinued operations
The loss after tax from discontinued operations of bmibaby and
bmi regional was EUR4 million for the year to December 31,
2013.
(11) Net deferred tax credit
In the year, the Group recognised a EUR306 million deferred tax
asset relating to losses incurred by Iberia from 2013 and 2012.
Recognition is based on Management's expectation of the
recoverability of these losses against future profits.
Recoverability was based on the improved operating performance in
the current year and from the projections included within the
Business plan.
During 2014, the Spanish government enacted a number of changes
as part of the Spanish Tax Reform, including the phased reduction
of corporation tax rate from 30 per cent to 25 per cent and a
change in loss utilisation rules. A related tax charge of EUR37
million was also recognised.
4. Discontinued operations
In 2014, there was no revenue and no expenditure on operations
relating to discontinued operations (2013: total expenditure on
operations of EUR4 million, related to additional costs incurred in
handing back bmibaby aircraft to lessors)
5. SEASONALITY
The Group's business is highly seasonal with demand strongest
during the summer months. Accordingly higher revenues and operating
profits are usually expected in the latter six months of the
financial year than in the first six months.
6. SEGMENT INFORMATION
a. Business segments
British Airways, Iberia and Vueling are managed as individual
operating companies. Each airline operates its network operations
as a single business unit. The chief operating decision maker is
responsible for allocating resources and assessing performance of
the operating segments, and has been identified as the IAG
Management Committee. The IAG Management Committee makes resource
allocation decisions based on network profitability, primarily by
reference to the passenger markets in which the companies operate.
The objective in making resource allocation decisions is to
optimise consolidated financial results. Therefore, based on the
way the Group treats its businesses, and the manner in which
resource allocation decisions are made, the Group has three (2013:
three) reportable operating segments for financial reporting
purposes, reported as British Airways, Iberia and Vueling.
For the year to December 31, 2014 2014
-----------------------------------------------------------------------
EUR million British Airways Iberia Vueling Other Group companies Total
-------------------------------------- ---------------- ------- -------- ------------------------ --------
Revenue
External revenue 14,456 3,989 1,725 - 20,170
Inter-segment revenue 37 279 - 107 423
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Segment revenue 14,493 4,268 1,725 107 20,593
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Depreciation, amortisation and impairment (1,027) (76) (11) (3) (1,117)
Operating profit/(loss) before exceptional
items 1,215 50 141 (16) 1,390
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Exceptional items (note 3) - (361) - - (361)
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Operating profit/(loss) after exceptional
items 1,215 (311) 141 (16) 1,029
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Net non-operating costs (201)
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Profit before tax from continuing
operations 828
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
For the year to December 31, 2013 2013
-----------------------------------------------------------------------
EUR million British Airways Iberia Vueling Other Group companies Total
-------------------------------------- ---------------- ------- -------- ------------------------ --------
Revenue
External revenue 13,337 4,102 1,130 - 18,569
Inter-segment revenue 18 128 3 84 233
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Segment revenue 13,355 4,230 1,133 84 18,802
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Depreciation, amortisation and impairment (851) (154) (5) (4) (1,014)
Operating profit/(loss) before exceptional
items 762 (166) 168 6 770
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Exceptional items (note 3) 68 (316) - 5 (243)
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Operating profit/(loss) after exceptional
items 830 (482) 168 11 527
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Net non-operating costs (300)
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
Profit before tax from continuing
operations 227
-------------------------------------------- ---------------- ------- -------- ------------------------ --------
6. SEGMENT INFORMATION continued
b. Geographical analysis
Revenue by area of original sale
Year to December 31
----------------------
EUR million 2014 2013
--------------------------------------------------- ---------- ----------
UK 6,931 6,085
Spain 3,203 2,839
USA 2,893 2,677
Rest of world 7,143 6,968
---------- ----------
20,170 18,569
--------------------------------------------------- ---------- ----------
Assets by area
December 31, 2014
EUR million Property, plant and equipment Intangible assets
------------------- ------------------------------ ------------------
UK 10,131 1,184
Spain 1,624 1,218
USA 24 12
Rest of world 5 24
------------------- ------------------------------ ------------------
Total 11,784 2,438
------------------- ------------------------------ ------------------
December 31, 2013
EUR million Property, plant and equipment Intangible assets
------------------- ------------------------------ ------------------
UK 8,891 1,022
Spain 1,296 1,138
USA 34 5
Rest of world 7 31
------------------- ------------------------------ ------------------
Total 10,228 2,196
------------------- ------------------------------ ------------------
7. FINANCE COSTS AND INCOME
Year to December 31
----------------------
EUR million 2014 2013
---------------------------------------------------------------------------------------- ---------- ----------
Finance costs
Interest payable on bank and other loans, finance charges payable under finance leases (211) (237)
Unwinding of discount on provisions (39) (51)
Capitalised interest on progress payments 2 4
Change in fair value of cross currency swaps (5) (7)
Currency credits/(charges) on financial fixed assets 16 (10)
---------------------------------------------------------------------------------------- ---------- ----------
Total finance costs (237) (301)
---------------------------------------------------------------------------------------- ---------- ----------
Finance income
Interest on other interest-bearing deposits 32 31
---------------------------------------------------------------------------------------- ---------- ----------
Total finance income 32 31
---------------------------------------------------------------------------------------- ---------- ----------
Net charge relating to pensions
Net financing charge relating to pensions (4) (53)
---------------------------------------------------------------------------------------- ---------- ----------
Net financing charge relating to pensions (4) (53)
---------------------------------------------------------------------------------------- ---------- ----------
8. Tax
The tax credit for the year to December 31, 2014 is EUR175
million (2013: EUR76 million charge).
In quarter 4 2014, EUR306 million of deferred tax assets were
recognised relating to losses incurred by Iberia in 2013 and 2012.
A tax charge of EUR37 million was also recognised in relation to
the phased reduction in the corporation tax rate in Spain from 30
per cent to 25 per cent.
Excluding the effect of deferred tax assets recognised in the
year, the impact of the tax rate reductions and tax on the
exceptional items totalling a credit of EUR413 million, the
effective tax rate for the year to December 31, 2014 was 22 per
cent.
9. EARNINGS PER SHARE
The number of shares in issue at December 31, 2014 and 2013 was
2,040,078,523 ordinary shares with a par value of EUR0.50 each.
Year to December 31
----------------------
Millions 2014 2013
-------------------------------------------------------- ---------- ----------
Weighted average number of ordinary shares outstanding 2,036 1,906
Weighted average number for diluted earnings per share 2,162 1,945
-------------------------------------------------------- ---------- ----------
Year to December 31
----------------------
EUR cents 2014 2013
-------------------------------------------------------- ---------- ----------
Basic earnings per share 48.2 6.4
Diluted earnings per share 46.4 6.3
-------------------------------------------------------- ---------- ----------
10. DIVIDENDS
The Directors propose that no dividend be paid for the year to
December 31, 2014 (December 31, 2013: nil).
11. PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE ASSETS
EUR million Property, plant and equipment Intangible assets
------------------------------------------- ------------------------------ ------------------
Net book value at January 1, 2014 10,228 2,196
Additions 2,499 138
Disposals (404) -
Depreciation, amortisation and impairment (1,152) (44)
Impairment reversal - 79
Exchange movements 613 69
------------------------------------------- ------------------------------ ------------------
Net book value at December 31, 2014 11,784 2,438
------------------------------------------- ------------------------------ ------------------
EUR million Property, plant and equipment Intangible assets
------------------------------------------- ------------------------------ ------------------
Net book value at January 1, 2013 9,926 1,965
Additions 2,057 150
Acquired through Business combination 3 168
Disposals (523) (27)
Reclassifications (15) -
Depreciation, amortisation and impairment (982) (32)
Exchange movements (238) (28)
------------------------------------------- ------------------------------ ------------------
Net book value at December 31, 2013 10,228 2,196
------------------------------------------- ------------------------------ ------------------
Capital expenditure authorised and contracted but not provided
for in the accounts amounts to EUR9,027 million (December 31, 2013:
EUR8,745 million). The majority of capital expenditure commitments
are denominated in US dollars, and as such are subject to changes
in exchange rates
12. IMPAIRMENT REVIEW
The carrying amounts of intangible assets with indefinite life
and goodwill for the three cash generating units of the Group
are:
EUR million Goodwill Brand Customer loyalty programmes Landing rights Total
--------------------------------------- --------- ------ ---------------------------- --------------- ------
2014
Iberia
January 1, 2014 - 227 253 423 903
Impairment reversal - 79 - - 79
--------------------------------------- --------- ------ ---------------------------- --------------- ------
December 31, 2014 - 306 253 423 982
--------------------------------------- --------- ------ ---------------------------- --------------- ------
British Airways
January 1, 2014 48 - - 789 837
Additions - - - 1 1
Exchange movements 3 - - 50 53
--------------------------------------- --------- ------ ---------------------------- --------------- ------
December 31, 2014 51 - - 840 891
--------------------------------------- --------- ------ ---------------------------- --------------- ------
Vueling
January 1, 2014 28 35 - 89 152
December 31, 2014 28 35 - 89 152
--------------------------------------- --------- ------ ---------------------------- --------------- ------
December 31, 2014 79 341 253 1,352 2,025
--------------------------------------- --------- ------ ---------------------------- --------------- ------
EUR million Goodwill Brand Customer loyalty programmes Landing rights Total
--------------------------------------- --------- ------ ---------------------------- --------------- ------
2013
Iberia
January 1, 2013 - 227 253 423 903
--------------------------------------- --------- ------ ---------------------------- --------------- ------
December 31, 2013 - 227 253 423 903
--------------------------------------- --------- ------ ---------------------------- --------------- ------
British Airways
January 1, 2013 49 - - 796 845
Additions - - - 15 15
Exchange movements (1) - - (22) (23)
--------------------------------------- --------- ------ ---------------------------- --------------- ------
December 31, 2013 48 - - 789 837
--------------------------------------- --------- ------ ---------------------------- --------------- ------
Vueling
January 1, 2013 - - - - -
Additions due to Business combination 28 35 - 89 152
--------------------------------------- --------- ------ ---------------------------- --------------- ------
December 31, 2013 28 35 - 89 152
--------------------------------------- --------- ------ ---------------------------- --------------- ------
December 31, 2013 76 262 253 1,301 1,892
--------------------------------------- --------- ------ ---------------------------- --------------- ------
Basis for calculating recoverable amount
Goodwill, Brand and the customer loyalty programme recoverable
amounts have been measured based on their value-in-use.
Landing rights recoverable amount has been measured by reference
to market transactions of similar assets less costs to sell, or
through value-in-use.
Value-in-use is calculated using a discounted cash ow model.
Cash ow projections are based on the Business plan approved by the
Board covering a ve year period. Cash ows extrapolated beyond the
ve year period are projected to increase on long-term growth rates.
Cash ow projections are discounted using the cash generating unit's
(CGU) pre-tax discount rate.
12. IMPAIRMENT REVIEW continued
Annually the Group prepares and approves five year Business
plans. Business plans were approved in the fourth quarter of the
year. The Iberia Business plan cash flows used in the value-in-use
calculations reflect all restructuring of the business that has
been approved by the Board and which can be executed by Management
under existing agreements reached with the unions.
Key assumptions
The key assumptions used in the value-in-use calculations for
each of the CGU's are as follows. In addition, where there has been
an impairment loss in a CGU, the recoverable amount is also
disclosed.
2014
-------------------------------------
British Airways Iberia Vueling
----------------------------------------- ---------------- --------- --------
Long-term growth rate (per cent)(1) 2.5 2.2 2.2
Pre-tax discount rate (per cent)(2) 10.0 10.2 12.5
Recoverable amount of the CGU (million) n/a EUR6,400 n/a
----------------------------------------- ---------------- --------- --------
2013
-------------------------------------
British Airways Iberia Vueling
----------------------------------------- ---------------- --------- --------
Long-term growth rate (per cent)(1) 2.5 - -
Pre-tax discount rate (per cent)(2) 10.0 12.2 12.4
----------------------------------------- ---------------- --------- --------
(1) The long-term growth rate is calculated for each CGU based
on the forecasted weighted average exposure in each primary market
using gross domestic product (GDP). This is amended from
time-to-time to reflect specific market risk. This was last the
case in 2013, when Management assessed the outlook for the economic
environment in Spain as challenging following two years of negative
GDP.
(2) Pre-tax discount rates represent the current market
assessment of the risks specific to each CGU, taking into
consideration the time value of money and underlying risks of its
primary market. The discount rate calculation is based on the
circumstances of the airline industry, the Group and its CGU. It is
derived from the weighted average cost of capital (WACC). The WACC
takes into consideration both debt and equity available to
airlines. The cost of equity is derived from the expected return on
investment by airline investors and the cost of debt is broadly
based on the Group's interest-bearing borrowings. CGU specific risk
is incorporated by applying individual beta factors which are
evaluated annually based on available market data. The pre-tax
discount rate reflects the timing of future tax flows.
Summary of results
In 2014, Management reviewed the recoverable amount of each of
the CGUs and concluded the recoverable amounts exceeded the
carrying values.
Following the impairment review of the Iberia CGU in 2012,
goodwill and a franchise agreement were impaired by their full
carrying amounts and the Iberia Brand was written down by EUR79
million. The impairment of goodwill cannot be reversed and the
franchise agreement has since expired. The original impairment of
the Iberia Brand has been reassessed in the current year given the
excess of the Iberia CGU recoverable amount over its carrying
value. The reassessment included testing the Iberia Brand
recoverable amount using the royalty methodology, with a royalty
rate of 0.60 per cent (2013: 0.60 per cent). Individually and in
combination, the value-in-use tests of the Iberia CGU and of the
Iberia Brand support the reversal of the original EUR79 million
impairment. This has been recorded as an exceptional credit within
Depreciation, amortisation and impairment in the Income
statement.
Sensitivities
For the Iberia cash generating unit, additional sensitivities
have been considered at the overall CGU level. A 16 point increase
in the post-tax discount rate would reduce the recoverable amount
to the carrying amount. A 7 point reduction in the operating margin
in each year of the Business plan, and extrapolated beyond the plan
would reduce the recoverable amount to the carrying amount.
No reasonable possible change in the key assumptions for the
British Airways or Vueling CGUs would cause the carrying amounts of
goodwill to exceed the recoverable amounts.
13. NON-CURRENT ASSETS HELD FOR SALE
The non-current assets held for sale of EUR18 million (2013:
EUR12 million) represent EUR11 million for the remaining investment
of 0.075 per cent in Amadeus representing one settlement day
outstanding, and EUR7 million representing six Boeing 737 engines
(2013: four Boeing 737s and one Boeing 767 aircraft stood down).
These are presented within the Iberia and British Airways operating
segments respectively and will exit the business within 12 months
of December 31, 2014.
Assets held for sale with a net book value of EUR3 million were
disposed of by the Group during the year to December 31, 2014
resulting in a loss of EUR2 million on disposal (2013: property
with a net book value of EUR3 million disposed of at no gain or
loss).
14. FINANCIAL INSTRUMENTS
a. Financial assets and liabilities by category
The detail of the Group's nancial instruments at December 31,
2014 and December 31, 2013 by nature and classi cation for
measurement purposes is as follows:
December 31, 2014 Financial assets
Total carrying
Loans and Derivatives used Non-financial amount by balance
EUR million receivables for hedging Available-for-sale assets sheet item
Non-current assets
Available-for-sale
financial assets - - 84 - 84
Derivative
financial
instruments - 80 - - 80
Other non-current
assets 167 - - 21 188
Current assets
Trade receivables 1,252 - - - 1,252
Other current
assets 244 - - 367 611
Non-current assets
held for sale - - 11 7 18
Derivative
financial
instruments - 178 - - 178
Other current
interest-bearing
deposits 3,416 - - - 3,416
Cash and cash
equivalents 1,528 - - - 1,528
Financial liabilities
Total carrying
Loans and Derivatives used Non-financial amount by balance
EUR million payables for hedging liabilities sheet item
Non-current
liabilities
Interest-bearing long-term borrowings 5,904 - - 5,904
Derivative
financial
instruments - 359 - 359
Other long-term
liabilities 7 - 219 226
Current liabilities
Current portion of long-term
borrowings 713 - - 713
Trade and other
payables 3,017 - 264 3,281
Deferred revenue on
ticket sales - - 3,933 3,933
Derivative
financial
instruments - 1,313 - 1,313
14. FINANCIAL INSTRUMENTS continued
December 31, 2013 Financial assets
Total carrying
Loans and Derivatives used Non-financial amount by balance
EUR million receivables for hedging Available-for-sale assets sheet item
Non-current assets
Available-for-sale
financial assets - - 1,092 - 1,092
Derivative
financial
instruments - 35 - - 35
Other non-current
assets 182 - - 15 197
Current assets
Trade receivables 1,196 - - - 1,196
Other current
assets 270 - - 361 631
Derivative
financial
instruments - 135 - - 135
Other current
interest-bearing
deposits 2,092 - - - 2,092
Cash and cash
equivalents 1,541 - - - 1,541
Financial liabilities
Derivatives used for Non-financial Total carrying amount
EUR million Loans and payables hedging liabilities by balance sheet item
Non-current
liabilities
Interest-bearing
long-term borrowings 4,535 - - 4,535
Derivative financial
instruments - 66 - 66
Other long-term
liabilities 7 - 218 225
----------------------- ------------------ --------------------- ---------------------- ---------------------
Current liabilities
Current portion of
long-term borrowings 587 - - 587
Trade and other
payables 2,971 - 326 3,297
Deferred revenue on
ticket sales - - 3,496 3,496
Derivative financial
instruments - 528 - 528
------------------ --------------------- ---------------------- ---------------------
b. Fair value of financial assets and financial liabilities
The fair values of the Group's financial instruments are
disclosed in hierarchy levels based on the nature of the inputs
used in determining the fair values as follows:
Level 1: Quoted prices (unadjusted) in active markets for
identical assets and liabilities. A market is regarded as active if
quoted prices are readily and regularly available from an exchange,
dealer, broker, industry group, pricing service, or regulatory
agency, and those prices represent actual and regularly occurring
market transactions on an arm's length basis;
Level 2: Inputs other than quoted prices included within Level
1, that are observable for the asset or liability, either directly
or indirectly. The fair value of financial instruments that are not
traded in an active market is determined by valuation techniques.
These valuation techniques maximise the use of observable market
data where it is available and rely as little as possible on entity
specific estimates; and
Level 3: Inputs for the asset or liability that are not based on
observable market data.
The fair value of cash and cash equivalents, other current
interest-bearing deposits, trade receivables, other current assets,
trade and other payables and deferred revenue on ticket sales
approximate their carrying value largely due to the short-term
maturities of those instruments.
14. FINANCIAL INSTRUMENTS continued
The following methods and assumptions were used by the Group in
estimating its fair value disclosures for financial
instruments:
Instruments included in Level 1 comprise listed asset
investments classified as available-for-sale and interest-bearing
borrowings which are stated at market value at the balance sheet
date.
Instruments included in Level 2 include derivatives and
interest-bearing borrowings.
Forward currency transactions and over-the-counter fuel
derivatives are entered into with various counterparties,
principally financial institutions with investment grade ratings.
These are measured at the market value of instruments with similar
terms and conditions at the balance sheet date using forward
pricing models. Counterparty and own credit risk is deemed to be
not significant.
The hedge of the available-for-sale asset takes the form of an
equity collar. The valuation of this collar is based on a Black
Scholes valuation model using share price spot rate, strike price,
stock volatility and the euro interest rate curve.
The fair value of the Group's interest-bearing borrowings
including leases are determined by discounting the remaining
contractual cash flows at the relevant market interest rates as at
the balance sheet date.
All resulting fair value estimates are included in Level 2
except for certain investments which are classified as Level 3.
The carrying amounts and fair values of the Group's financial
assets and liabilities at December 31, 2014 are set as follows:
Fair value Carrying value
EUR million Level 1 Level 2 Level 3 Total Total
Financial assets
Available-for-sale financial assets 19 - 65 84 84
Derivatives(1) - 258 - 258 258
Financial liabilities
Interest-bearing borrowings 892 6,256 - 7,148 6,617
Derivatives(2) - 1,672 - 1,672 1,672
(1) Current portion of derivative financial assets is EUR178 million.
(2) Current portion of derivative financial liabilities is EUR1,313 million.
December 31, 2013:
Fair value Carrying value
EUR million Level 1 Level 2 Level 3 Total Total
Financial assets
Available-for-sale financial assets 1,070 - 22 1,092 1,092
Derivatives(1) - 170 - 170 170
Financial liabilities
Interest-bearing borrowings 802 4,658 - 5,460 5,122
Derivatives(2) - 594 - 594 594
(1) Current portion of derivative financial assets is EUR135 million.
(2) Current portion of derivative financial liabilities is EUR528 million.
There have been no transfers between levels of fair value
hierarchy during the year.
Out of the financial instruments listed in the previous table,
only the interest-bearing borrowings are not measured at fair value
on a recurring basis.
14. FINANCIAL INSTRUMENTS continued
c. Level 3 financial assets reconciliation
The following table summarises key movements in Level 3 financial assets:
EUR million December 31, 2014 December 31, 2013
Opening balance for the year 22 29
Gains recognised in the Income statement(1) 1 1
Gains recognised in Other comprehensive income(2) 48 -
Sales - (2)
Settlements (7) (6)
Exchange movements 1 -
Closing balance for the year 65 22
(1) Included in Net credit relating to available-for sale-financial assets in the consolidated
Income statement.
(2) Included in Available-for-sale financial assets - Fair value movements in equity in the
consolidated Statement of other comprehensive income.
The fair value of Level 3 financial assets cannot be measured reliably; as such these assets
are stated at historic cost less accumulated impairment losses with the exception of the Group's
investment in The Airline Group Limited. This unlisted investment had previously been valued
at nil, since the fair value could not be reasonably calculated. During the year to December
31, 2014 other shareholders disposed of a combined holding of 49.9 per cent providing a market
reference from which to determine a fair value. The revaluation resulted in a gain of EUR48
million recognised in Other comprehensive income. The investment remains classified as a Level
3 financial asset due to the valuation criteria applied not being observable, with the resultant
fair value uplift being non-recurring in nature.
15. Borrowings
December 31, December 31,
2014 2013
Current
Bank and other loans 164 183
Finance leases 549 404
713 587
Non-current
Bank and other loans 1,069 1,169
Finance leases 4,835 3,366
5,904 4,535
The Group's finance lease for one Airbus A340-600 is subject to
financial covenants which are tested annually. The lease is part of
a syndicate family. The Group has informed the syndicate that it
had failed to meet the covenants for the year to December 31, 2014.
As a result of these covenant breaches, the finance lease has
technically become repayable on demand and $79 million (EUR65
million) has been classified as current. The institutions formally
waived the breach on February 25, 2015.
Three of the Group's Airbus A340-600 operating leases are also
subject to financial covenants which are tested annually. The Group
has informed the syndicate that it had failed to meet the covenants
for the year to December 31, 2014. The remaining operating lease
payments of $156 million (EUR128 million) will technically fall due
within one year. The institutions have provided positive feedback
and are expected to formally waive the breach in March 2015.
16. SHARE BASED PAYMENTS
During the year 5,717,197 conditional shares were awarded under
the Group's Performance Share Plan (PSP) to key senior executives
and selected members of the wider management team. No payment is
due upon the vesting of the shares. The fair value of
equity-settled share schemes granted is estimated at the date of
the award using the Monte-Carlo model, taking into account the
terms and conditions upon which the options were awarded. The
following are the inputs to the model for the PSP options granted
in the year:
Expected share price volatility: 35 per cent
Expected life of options: 3 years
Weighted average share price: GBP4.35
The Group also made awards related to the 2013 performance year
for qualifying employees under the Incentive Award Deferral Plan
(IADP) during the year, under which 2,079,780 conditional shares
were awarded.
17. EMPLOYEE BENEFIT OBLIGATIONS
The Group operates two principal funded defined benefit pension schemes in the UK, the Airways
Pension Scheme (APS) and the New Airways pension scheme (NAPS), both of which are closed to
new members.
At December 31, 2014
EUR million APS NAPS Other Total
Scheme assets at fair value 9,542 16,201 424 26,167
Present value of scheme liabilities (8,191) (17,134) (795) (26,120)
Net pension asset/(liability) 1,351 (933) (371) 47
Effect of the asset ceiling (502) - - (502)
Other employee benefit obligations - - (14) (14)
December 31, 2014 849 (933) (385) (469)
Represented by:
Employee benefit asset 855
Employee benefit obligation (1,324)
(469)
At December 31, 2013
EUR million APS NAPS Other Total
Scheme assets at fair value 8,250 13,847 384 22,481
Present value of scheme liabilities (7,535) (14,342) (608) (22,485)
Net pension asset/(liability) 715 (495) (224) (4)
Effect of the asset ceiling (236) - - (236)
Other employee benefit obligations - - (13) (13)
December 31, 2013 479 (495) (237) (253)
Represented by:
Employee benefit asset 485
Employee benefit obligation (738)
(253)
17. EMPLOYEE BENEFIT OBLIGATIONS continued
The accounting valuation was performed after updating key assumptions at December 31, 2014
as follows:
APS NAPS
Per cent per annum December 31, 2014 December 31, 2013 December 31, 2014 December 31, 2013
Inflation (CPI) 1.85 2.50 1.95 2.55
Inflation (RPI) 2.85 3.25 2.95 3.30
Salary increases (as RPI) 2.85 3.25 2.95 3.30
Discount rate 3.45 4.40 3.80 4.70
Pension contributions for APS and NAPS were determined by actuarial valuation made as at March
31, 2012 using assumptions and methodologies agreed with the Trustees of each scheme.
18. PROVISIONS FOR LIABILITIES AND CHARGES
Employee leaving
indemnities and
other employee Restoration and
related Legal claims handback
EUR million provisions Restructuring provisions provisions Other provisions Total
Net book value at
January 1, 2014 592 682 101 684 135 2,194
Provisions
recorded during
the year 14 313 56 236 48 667
Utilised during
the year (17) (137) (31) (176) (49) (410)
Release of unused
amounts and other
movements (52) 25 5 (27) (26) (75)
Unwinding of
discount 14 11 3 9 2 39
Exchange
differences 1 1 1 45 8 56
----------------
Net book value at
December 31, 2014 552 895 135 771 118 2,471
----------------
Analysis:
Current 26 219 4 183 72 504
Non-current 526 676 131 588 46 1,967
19. CONTINGENT LIABILITIES
There were contingent liabilities at December 31, 2014 in
respect of guarantees and indemnities entered into as part of the
ordinary course of the Group's business. No material losses are
likely to arise from such contingent liabilities and guarantees.
The Group also had the following claims:
Cargo
The Group is party to a number of legal proceedings in the
English courts relating to a decision by the European Commission in
2010 which fined British Airways and ten other airline groups for
participating in a cartel in respect of air cargo prices. The
European Commission's decision is currently the subject of appeal,
but has led to a large number of claimants seeking, in proceedings
brought in the English courts and elsewhere, to recover damages
from British Airways and the other airlines which they claim arise
from the alleged cartel activity. It is not possible at this stage
to predict the outcome of the proceedings, which British Airways
will vigorously defend. British Airways has, or will, join in to
the proceedings the other airlines alleged to have participated in
cartel activity to obtain a contribution to such damages, if any,
awarded.
The Group is also party to similar litigation in a number of
other jurisdictions, including Germany, the Netherlands, Israel and
Canada, together with a number of other airlines. At present, the
outcome of the proceedings is unknown. In each case, the precise
effect, if any, of the alleged cartelising activity on the
claimants will need to be assessed.
On the basis of latest information obtained and advice from
legal counsel, we are currently unable to determine whether the
Group has an existing obligation as a result of the past event.
A number of other lawsuits and regulatory proceedings are
pending, the outcome of which in the aggregate is not expected to
have a material effect on the Group's financial position or results
of operations.
The Group has certain contingent liabilities and guarantees,
which at December 31, 2014 amounted to EUR138 million (December 31,
2013: EUR124 million).
20. RELATED PARTY TRANSACTIONS
The Group had the following transactions in the ordinary course
of business with related parties.
Sales and purchases of goods and services:
Year to December 31
EUR million 2014 2013
Sales of goods and services
Sales to associates 16 78
Sales to significant shareholders - -
Purchases of goods and services
Purchases from associates 59 61
Purchases from significant shareholders - -
Year end balances arising from sales and purchases of goods and services:
EUR million December 31, 2014 December 31, 2013
Receivables from related parties
Amounts owed by associates 6 7
Amounts owed by significant shareholders - -
Payables to related parties
Amounts owed to associates 6 6
Amounts owed to significant shareholders - -
For the year to December 31, 2014 the Group has not made any provision for doubtful debts
arising relating to amounts owed by related parties (2013: nil).
In 2012 the Group entered into a hedging transaction at arm's
length with Nomura International Plc, a related party to IAG as
there is a common Non-Executive Board member. The transaction was a
risk management exercise to protect the value of the 33,562,331
ordinary shares that the Group holds in Amadeus. During the third
quarter of 2014, the Group entered into an agreement to settle the
hedging transaction over its ownership interest in Amadeus and sell
its entire shareholding. At December 31, 2014 the Group had settled
99 per cent of the transaction.
On January 30, 2015 Qatar Airways announced that it has acquired
a 9.99 per cent shareholding in IAG.
Board of Directors and Management Committee remuneration
Compensation received by the Group's key management personnel is
as follows:
Year to December 31
EUR million 2014 2013
Base salary, fees and benefits
Board of Directors' remuneration 13 16
Management Committee remuneration 18 8
The Board of Directors includes remuneration for two Executive
Directors (2013: four Executive Directors).
The Management Committee includes remuneration for eight members
(2013: six members).
The Company provides life insurance for all Executive Directors
and the Management Committee. For the year to December 31, 2014 the
Company's obligation was EUR48,000 (2013: EUR37,000).
At December 31, 2014 the transfer value of accrued pensions
covered under defined benefit pension obligation schemes relating
to the Management Committee totalled EUR7 million (2013: EUR5
million).
No loans or credit transactions were outstanding with Directors
or officers of the Group at December 31, 2014 (2013: nil).
21. POST BALANCE SHEET EVENTS
On January 27, 2015 IAG submitted a proposal to make an offer
for Aer Lingus Group plc of EUR2.55 per share, structured as a cash
payment of EUR2.50 per share, payable upon completion, in addition
to an ordinary dividend of EUR0.05 per share. The proposal is
subject to certain pre-conditions.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
LIABILITY STATEMENT OF COMPANY DIRECTORS FOR THE PURPOSES
ENVISAGED UNDER ARTICLE 11.1.b OF SPANISH ROYAL DECREE 1362/2007 OF
19 OCTOBER (REAL DECRETO 1362/2007).
At a meeting held on February 26, 2015, the Directors of
International Consolidated Airlines Group, S.A. confirmed that to
the best of their knowledge the Condensed Consolidated Financial
Statements for the year to December 31, 2014 were prepared in
accordance with IAS 34 as adopted by the European Union, offer a
true and fair view of the assets, liabilities, financial situation,
cash flows and the results of International Consolidated Airlines
Group, S.A. and of the companies that fall within the consolidated
group taken as a whole, and the Condensed Consolidated Management
Report includes an accurate analysis of the required information
also in accordance with the Financial Conduct Authority's DTR
4.2.7R and DTR 4.2.8R (English regulation) including an indication
of important events in the year, a description of the principal
risks and uncertainties and a list of material related party
transactions.
February 26, 2015
Antonio Vázquez Romero Martin Faulkner Broughton
Chairman Deputy Chairman
William Matthew Walsh César Alierta Izuel
Chief Executive Officer
Patrick Jean Pierre Cescau Enrique Dupuy de Lôme Chávarri
Denise Patricia Kingsmill James Arthur Lawrence
MarÃa Fernanda MejÃa Campuzano José Pedro Pérez-Llorca y Rodrigo
Kieran Charles Poynter Marjorie Morris Scardino
Alberto Terol Esteban
AIRCRAFT FLEET
Number in service with Group companies
Total Total Changes since
December 31, December 31, December 31,
Off balance
On balance sheet
sheet fixed operating Future
assets leases 2014 2013 2013 deliveries Options
Airbus A318 2 - 2 2 - - -
Airbus A319 34 27 61 61 - 1 -
Airbus A320 49 123 172 140 32 75 182
Airbus A321 25 11 36 35 1 17 -
Airbus A330 - 8 8 5 3 8 14
Airbus
A340-300 7 - 7 7 - - -
Airbus
A340-600 4 13 17 17 - - -
Airbus A350 - - - - - 26 60
Airbus A380 8 - 8 3 5 4 7
Boeing 737-400 5 - 5 15 (10) - -
Boeing 747-400 43 - 43 51 (8) - -
Boeing 757-200 1 2 3 3 - - -
Boeing 767-300 14 - 14 20 (6) - -
Boeing 777-200 41 5 46 46 - - -
Boeing 777-300 9 3 12 8 4 - -
Boeing 787 8 - 8 4 4 34 28
Embraer E170 6 - 6 6 - - -
Embraer E190 9 2 11 8 3 - 15
Group total 265 194 459 431 28 165 306
As well as those aircraft in service the Group also holds 20 aircraft (2013: 36) not in service.
This information is provided by RNS
The company news service from the London Stock Exchange
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