British Airways shareholders set to land a bumper payout
BRITISH AIRWAYS’ owner International Airlines Group could step up its cost‑cutting plans and return even more money to shareholders, according to one of its largest investors.
British Airways chief executive apologises for disruptions
Old Mutual Global Investors (OMGI), a top-10 shareholder in IAG, said that despite the cost-cutting already carried out by chief executive Willie Walsh, there were “significant” savings to come.
With BA set to make further cuts and grow its sales, OMGI says investors would expect IAG to boost its payouts, in the absence of any acquisitions or investments.
IAG plans to hand €500million (£436.4million) back to investors this year through share buybacks, in addition to its regular dividends, which totalled £434million last year.
British Airways could step up its cost‑cutting plans and return even more money to shareholders
IAG plans to hand €500million (£436.4million) back to investors this year through share buybacks, in addition to its regular dividends, which totalled £434million last year.
It is generating so much cash at the moment, the question is not if shareholders get a special return, but if it becomes a regular thing
Kunal Kothari, UK all cap equities analyst at OMGI, said: “The cost base at BA is very high. You cannot grow when your costs are double those of your competitors.
“It is generating so much cash at the moment, the question is not if shareholders get a special return, but if it becomes a regular thing.
BA is still dealing with the fallout from the technical issues that grounded its flights
"We expect it to be returned to investors.”
BA is still dealing with the fallout from the technical issues that grounded its flights last weekend.
It also faces more cabin crew strikes over pay and benefits.