Last Friday, February 24th, IAG cargo released their 2016 full year financial results.
The past year’s revenues dropped by 6.6% down to euros 1.02 billion. The statement by IAG notes that when adjusting the prior year’s revenues in order to reflect a directly comparable operation, that the actual commercial revenue decrease was in effect 8% compared to 2015.
Tonnages up - Yields down
Yields for 2016 fell by 9.3% and according to IAG, reflect the continued competitive trading environment which the company also faced during 2015.
Cargo volumes moved actually rose by 3% and capacity on offer went up by 10.5%. The latter is put down to the inclusion for the first time of the IAG partner Are Lingus integration into IAG’s network.
IAG Cargo had a good start during the first quarter of last year but this was hampered by less demand for cargo space during the second and third quarters which led to a further pressure on yields on many sectors.
The end-of-year peak season was good to IAG Cargo but could not make up for the losses incurred earlier in the year.
Management stands behind its strategy for the future
Drew Crawley, IAG Cargo’s CEO was surely not overly happy with the annual results.
He commented that; “Despite a difficult year for the industry, we have delivered a resilient performance. We will continue to bring further benefits to our customers by understanding their needs and investing in all areas of our business through infrastructure improvements, network expansion, new partnerships and technology advances. We remain confident, he said, in our strategy for 2017 and beyond.”
IAG Cargo had a busy year
Despite 2016 results not where the management would have liked to see them, the IAG Cargo team have had quite a busy year in adding new destinations and enhancing product segments.
New destinations on offer were Lima, San Juan, both San Jose California and Costa Rica as well as Tehran, New Orleans, Oakland California and Florida’s Fort Lauderdale.
Aer Lingus cargo movements came into the IAG Cargo fold with the integration of the Irish national carrier into IAG during 2016.
2017 seems to have got off to a good start, so it will be interesting to see whether yields and revenues can pick up again at IAG Cargo during the coming months.
John Mc Donagh