British Airways owner International Consolidated Airlines Group SA (LSE:IAG) put out "surprisingly strong" quarterly numbers, according to analysts.
IAG beat expectations as it posted its first quarterly profit since the pandemic in what is seasonally its weakest quarter.
An operating profit of €9mln compared to a huge €741mln loss a year earlier, guidance for around a €200mln loss and a consensus forecast for a €179mln loss.
The outlook remains positive, led by strong leisure demand, he said, with management seeing full-year operating profit above the previous guidance range of €1.8-2.3bn and net debt expected to fall.
"IAG benefitted from both a strong unit revenue environment and lower fuel prices," said Liberum analyst Gerald Khoo, adding that the numbers were "surprisingly strong"
"We anticipate upward pressure on consensus estimates," said Khoo.
UBS analysts said: "In a flat market we expect the shares to be stronger."
Analysts at Barclays said the guidance was encouraging and they interpreted there would be a €300-400mln net debt reduction.
They noted that fuel costs for the full year were also guided to be lower, as €7.5bn compared to the previous €8.1bn, with 62% hedged in the range of $830-$810/MT from 56% hedged at the end of the last year in $1000-$910/MT.