Renta 4 | Reservations for the January / April period are + 1% higher than those of a year ago. This means positive news for the sector and mainly for European companies
Banc Sabadell | IAG’s Capital Markets Day focused on cash generation. The reduction of some operational objectives (AKO’s 2020/23 growth from + 6% to + 3.4% per year; annual BPA growth from + 12% to + 10%), is in line with market forecasts and BS (e) .
BOfAML | We modestly update our forecasts reflecting fuel prices and monthly traffic data reports. European airlines in our coverage have reported 6.5% ASK growth on average in 3Q19 and we look for 3.8% in 4Q19. We expect RASK recovery with flat unit revenues in 3Q19 on average and 1.7% yoy improvement in 4Q19.
Banc Sabadell | IAG results in Q119 in line with expectations in EBIT and better in financing post tax profits: Sales: 5.318 Bn€ (+5.9%); EBIT: 135 M€ (-51.8%); post tax profits: 70 M€ (-66%). Sales evolved slightly below expectations (-0.7% vs BS expected) affected by unitary passenger income after currency change which fell -1.4% (vs -1% BS expected). Thus was compensated by unitary non-fuel costs which fell -0.6% at constant exchange rates (vs 0% BS expected). This poor income performance contributes a certain negative trend.
Renta4 | IAG has published the March air traffic data, which show a beginning to the year similar to the company’s capacity (supply) target for Q119, with demand growing slightly more than supply, and in line with the target for the year of 5.9%.
IAG has decided that any non-EU investor which buys shares from today onwards will have their voting rights suspended and will have to sell them within 10 days. If they do not, IAG itself will buy these shares for repayment at the lowest price.
IAG has bought 4.61% of Norwegian Air. And according to Bloomberg, the Spanish airline could be considering making a bid for the whole company. IAG’s interest in the low cost long-distance segment (where Norwegian operates) is clear, given that it created an airline last year with these characteristics called Level.
Sonia Ruiz de Garibay (GVCGaesco) | Although a simultaneous investment recommendation for oil and airline stocks might seem a contradiction in terms, the fact they are both heavily influenced by oil prices gives them a very important element in common. Oil is an earning driver for the oil industry, while for the airlines sector it is an important costs’ element, accounting for over 20% of the total. Repsol and IAG are currently good bets.
Air Europa and Ryanair have formed an alliance under the terms of which the former will supply the latter’s long haul flights. Following the agreement, Ryanair’s website will sell the flights the Spanish airline offers from Madrid to 20 destinations in 16 countries in America. This is a market where Iberia is the traditional leader.
By Sean Duffy | MADRID | The announcement on Friday of the Qatar Investment Authority’s purchase of 9.99% of IAG is the latest flexing of financial muscle from the Gulf state. QIA continues to grow its portfolio in Europe, having already invested over €13bn in Spanish companies since the beginning of the crisis.