IAG SA raised earnings targets covering the next five years and appointed Alex Cruz, head of its low-cost Vueling unit, as chief executive officer at the main British Airways brand.
Europe’s third-biggest airline is targeting an operating profit equivalent to 12 to 15 percent of sales for the 2016-2020 period, up from a previous range of 10 to 14 percent, it said in a statement today. Cruz replaces Keith Williams as BA chief, with Steve Gunning, head of IAG Cargo, taking over from Nick Swift as the unit’s finance chief.
IAG, as International Consolidated Airlines Group SA is known, has swelled to four brands with the 1.4 billion-euro ($1.6 billion) takeover of Aer Lingus Group Plc, and also includes Spanish market leader Iberia. Barcelona-based Vueling helped make Cruz’s reputation by fending off Ryanair Holdings Plc and EasyJet Plc, Europe’s biggest discounters.
“Vueling has become a dynamic, innovative and cost-effective airline and Alex will bring new experience and insight to British Airways,” IAG CEO Willie Walsh said in the statement. Gunning “has been highly effective in setting up IAG’s first ever single business unit at IAG Cargo,” the executive added.
IAG also will also target a return on invested capital of 15 percent over the next five years, compared with a previous target of 12 percent. It also lifted the target for earnings per share by two percentage points to 12 percent.
This article was written by Kari Lundgren from Bloomberg and was legally licensed through the NewsCred publisher network.