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IAG share price heads south as strikes weigh on group’s performance

Shares in International Consolidated Airlines (LON:IAG) have fallen deep into the red in today’s session as the British Airways and Iberia parent revealed that the French air control strikes weighed on its performance in the first half of the year. IAG’s boss meanwhile has signalled that the company, which also owns Aer Lingus as low-cost airlines Vueling and Level, is still interested in buying budget carrier Norwegian Air Shuttle, Reuters reports.

As of 09:20 BST, IAG’s share price had given up 3.85 percent to 658.60p, underperforming the broader UK market, with the benchmark FTSE 100 index having climbed into positive territory and currently standing 0.44 percent higher at 7,609.55 points. The group’s shares have added more than eight percent to their value over the past year, as compared with about a 1.8-percent gain in the Footsie.

IAG updates market on interim performance

IAG said in a statement this morning that its second-quarter operating profit before exceptional items had climbed to €835 million, up from €790 million. The group’s passenger  unit revenue for the quarter meanwhile dipped 1.9 percent, while rising 2.3 percent at constant currency.

IAG’s chief executive Willie Walsh said in the statement that the  French Air Traffic Control strikes had continued to challenge the group’s airlines, with Spanish low-cost carrier Vueling  particularly affected, incurring an additional €20 million of disruption costs in the quarter.

“These strikes are also having a significant negative impact on the Spanish economy and tourism,” Walsh pointed out. IAG, however, reassured investors that it still  expects its full-year operating profit to show an increase year-on-year. 

Group still interested in Norwegian Air deal

Reuters meanwhile reports that Walsh had told BBC radio today that IAG remained interested in Norwegian after the two held talks earlier this year.

“We’re not in any active discussions with them at the moment,” he pointed out, adding, however, that the group continued to look at Norwegian and continued “to have some interest in it”.

As of 10:06 BST, Friday, 03 August, International Consolidated Airlines Grp share price is 659.51p.

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