British Airways owner IAG set to rebound to profit

It comes amid early positivity in the sector, which has helped support a 30 per cent improvement in IAG shares since the start of 2023, amid indications that holiday and travel spending is holding up better than many expected during the cost-of-living crisis.

Heathrow - British Airways' main base - revealed earlier this week that has posted its busiest start to the year since before the coronavirus pandemic.

The UK's busiest airport revealed more than 5.4 million passengers travelled through Heathrow in January, reaching levels not seen since the start of 2020, prompting hopes for bumper returns for airliners.

Market analysts have predicted that IAG will report operating profits of 1.2 billion euro (£1.07bn) for 2022 in its new update.

It will represent a major improvement after the group recorded a 2.8 billion euro (£2.45bn) operating loss in 2021 as travel restrictions still held the business back.

Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said: "While their clientele might be different, we're cautiously encouraged by what IAG will have to say judging by the impressive boosts to passenger numbers Tui has recently reported.”