BA bank holiday IT meltdown cost carrier €65m

BA bank holiday IT meltdown cost carrier €65m

Compensation fees and baggage claims related the British Airways power failure over the second May bank holiday weekend cost €65 million.

The bill for the operational disruption, which led to hundreds of flights being cancelled, was disclosed today in half-year results announced by parent company International Airlines Group.

IAG’s overall operating profit before exceptional items for the six months to June 30 rose by more than 37% to €975 million, including an adverse foreign exchange impact of €44 million

BA made a profit of €741 million before exceptional items, up from €631 million in the same period in 2016.

Iberia moved into the black with a profit of €84 million against a year-on-year loss of €6 million.

Aer Lingus profit rose to €59 million from €42 million and Spanish low-cost carrier Vueling cut its loss from €54 million to €6 million.

The group’s half year profit after tax edged up by 2.3% to €567 million.

IAG expects its operating profit for 2017 to show a double-digit percentage improvement year-on-year at current fuel prices and exchange rates.

Chief executive Willie Walsh said: “The underlying trend in unit revenue improved, benefitting partially from Easter and a weak base last year.

“Non-fuel unit costs before exceptional items are up, at constant currency. These costs include the financial impact of the power failure which affected British Airways’ customers.”

Sales for new Barcelona-based low cost, long-haul arm Level  continue to be “well ahead of our expectations,” he added.

The airline started operating in June with flights to four destinations.

“We’ve ordered three additional aircraft and are considering other European bases for the operation,” Walsh said.

Walsh denied that BA had “lost the plot” in terms of customer service.

He told the BBC this morning: “I know we have had some individual issues and we clearly need to address those and apologise to our customers who were disrupted.

“But the truth is BA’s underlying performance is actually very good, as are the performances of the other airlines within the group, so this is a very strong set of results and reflects a focus that IAG has on providing customer service at prices that customers are willing to pay.”

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