HE Holding company International Consolidated Airlines Group (IAG) the stock market has fallen more than 6% this year After learning the results for 2022, which turned a profit on Friday. In the first minutes of listing, the stock is already down as much as 3% to 1,819 euros. The drop came after the announcement on the last day that it had reached an agreement with Globalia to purchase the remaining 80% of Air Europa’s issued capital for 400 million Euros.
Accordingly, autumn Ignacio CantosDirector of Investments at atl Capital, “the company’s initial valuation stems from the fact that: 1,000 euros and eventually closed at 400 millionreflects the state of airlines”. He adds that the results presented recently are “pretty good,” but that these are already reflected in the share price, while investors are still waiting for the outcome of the adjustments.
“Since before the pandemic Lost 60% of its value in the stock marketWhile it is true that he has made a very large capital increase,” he explains. Ignacio Cantos. Regarding the future of the company’s route, it shows that the price of fuel has increased, but this is offset by the increase in ticket prices, which increases margins.
IAG is abandoning losses from the pandemic after closing 2022 with a net profit of 431 million euros, as opposed to a negative 2,933 million euros in 2021. In the results presentation, he stated that it is expected to increase the operating capacity (average). seats-kilometers offered) up to 98% compared to pre-pandemic. In 2022, the average was 78%.
Iberia, in particular, Recorded an operating profit of 382 million euros in 2022The IAG group is the airline with the best operating result ahead of exceptional items this year, surpassing a loss of €234 million in 2021, 23.1% less than in 2012, followed by British Airways, Vueling and Aer Lingus. as reported to the National Securities Market Commission (CNMV) this Friday.
Improvement in market positioning
The Air Europa acquisition operation closed after it took over the remaining 20% stake last August, which had been stagnant for three years. Experts consider purchasing a improvement in market position and strengthening its strategy for the future.
After obtaining approval from the competition authorities, the first €200 million will be paid in two tranches: €100 million in IAG common stock and €100 million in cash. In the second and third years after the approval date, an additional 100 million euros will be paid each year.
“The acquisition enables Air Europa to strengthen its market position between Europe and Latin America. “There were countries where Iberia didn’t have as much access as Brazil, where Air Europa allowed it to expand its capillary,” he explains. Father SuauProfessor of economics and business studies and air transport specialist at UOC.
It also underlines that: Able to compete with centers in Northern Europe: “There are other companies working to compete with Iberia, such as Air France or KLM, and connecting through hubs in northern Europe in collaboration with Latam.” And he highlights the possibility that the group will now make the Madrid-Barajas airport “the great gateway from Europe to Latin America”.
According to both airlines, it can take up to 18 months to obtain regulatory approvals. In fact, the deal is subject to the approval of the Competition authorities as well as the SEPI and ICO. The professor points out that it will be interesting to see what the regulator has to say about these markets, as “competition will drop” and there is already a significant loss of competitiveness on some routes. It also clarifies that the purchase should help. industry consolidation process“The recent years have been seen with various mergers that have made companies resilient to shocks like the pandemic.”