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BA owner IAG hit by Brexit, terror attacks and air traffic control strikes

Published 29/07/2016

British Airways said it was experiencing lower demand for flights
British Airways said it was experiencing lower demand for flights

A weak pound triggered by the Brexit vote, terror attacks and air traffic control strikes took their toll on British Airways owner IAG in the first six months of the year, with the group poised to cut capacity and review investments as a result.

Last month the airline was forced to issue a profit warning following the referendum result, and on Friday the firm said it was experiencing lower demand for flights.

Chief executive Willie Walsh said: "Our performance this quarter saw a negative currency impact of 148 million euros (£124.4 million), primarily due to the weak pound. Numerous external factors affected our airlines, including the impact of terrorism, uncertainty around the UK's EU referendum and Spain's political situation.

"This led to a softer-than-expected trading environment, especially in June. In addition, the airlines' operations have been considerably disrupted by 22 air traffic control strikes in Europe so far this year."

IAG added that plans to increase capacity would be scaled back and its investment pipeline for next year is "under review".

The airline, which also owns Aer Lingus and Iberia, reported a 4.1% increase in sales to 10.8 billion euros (£9.1 billion) while pre-tax profits rose 48% to 609 million euros (£512 million).

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