How much do airlines make off flights? Latest sales and profits amid NATS air traffic control chaos criticism

Flyers across the UK and Europe are continuing to face delays and flight cancellations after a technical fault crashed air traffic control systems earlier this week.

On Monday (28 August), dodgy flight data sent the UK’s largest airspace operator National Air Traffic Services (NATS) into meltdown. It came just weeks after its CEO Martin Rolfe received a 96% pay rise, despite the part-government-owned company admitting it still uses “ageing systems” and was directly culpable for a significant rise in passenger delays in 2022.

The situation has left some passengers out of pocket. While airlines should be covering costs for at least many of those who have been left stranded, there have been reports of people being forced to sleep on terminal floors. Airlines have also wriggled out of compensation claims due to the fact that the air traffic control failures count as ‘extraordinary’ circumstances beyond their control.

At the same time, carrier trade body, the International Air Transport Association (IATA), has called for a change in the rules so that NATS will have to contribute towards the costs of any delays it is directly at fault for. IATA has projected the debacle will cost its members £100 million in lost revenues.

But how significant is this figure in the context of what the biggest UK airlines earn per year? NationalWorld has looked at the biggest carriers’ balance sheets to find out.

• IAG (owns British Airways, Iberia, Vueling, Aer Lingus)

One of the world’s biggest airline companies, which operates several of Europe’s most well-known brands, recorded a “strong recovery” from the Covid-19 pandemic in its latest full-year results (for the year to 31 December 2022).

Its revenues climbed from €8.5 billion (£7.3 billion) in 2021 to €23.1 billion (£19.8 billion) last year - a 172% rise that has brought the company back in line with its pre-pandemic figures.

This boost also brought about a return to profitability for the business, with operating profits climbing €4.1 billion (£3.5 billion) year-on-year from a €2.8 billion (£2.4 billion) loss to a €1.3 billion (£1.1 billion) profit. It says it does not expect to see a return to pre-Covid profit levels for a “few years”.

However, its financials for 2023 so far suggest it may get close this year. According to its half year report, IAG recorded a “record” operating profit of €1.3 billion (£1.1 billion) over the first six months of the year. Its sales hit €13.6 billion (£11.7 billion) over this period, which means it is also on course to surpass 2022’s performance on this front too.

• Ryanair

The budget carrier has faced criticism for its hidden fees in recent days. But these don’t appear to be harming its performance, with revenues climbing €6 billion (£5.14 billion or 125%) to €10.8 billion (£9.25 billion) over the 12 months to 31 March 2023.

This figure meant it was faring better than it was pre-pandemic and came as a result of Ryanair actually increasing its flight capacity versus pre-Covid times, according to its CEO Michael O’Leary. This despite the spate of strikes and staff shortage-related disruption seen at airports in the summer of 2022.

Pre-tax profits have also recovered and hit their highest level since the 2017/18 financial year. They grew from a €430 million (£368 million) loss last year to a €1.4 billion (£1.2 billion) profit this year.

• EasyJet

A decent performance has also been seen at fellow low-cost carrier EasyJet. In the year to 30 September 2022, it saw total sales soar to £5.8 billion - a 296% leap on the £1.5 billion posted the previous year, but still 10% short of 2019 levels (£6.4 billion).

Despite the improving picture, it still posted a pre-tax loss of £178 million (down from £1.1 billion). In its annual report, it said the loss had come about as a result of the costs of scaling up operations at the same time as struggling with a tight labour market and the impact of the Russia-Ukraine war on fuel prices (something which has been more hidden in the balance sheets of the other carriers as a result of when they end their financial years).

The good news for EasyJet has been that 2023 looks set to be a lucrative year. Revenues over the first six months of its financial year (up to 31 March 2023), have grown 80% to £2.7 billion, with the airline expecting a return to profitability by the time of its full-year results. The turnaround has come as a result of a boost in bookings and capacity following a “successful” recruitment drive, with EasyJet also banking on the cost of living crisis fitting with its low-cost business model.

• Jet2

Like Ryanair, Jet2 has emerged from the pandemic with better sales than it had beforehand. Revenues jumped 317% from £1.2 billion to £5 billion in the year to 31 March 2023. This figure was 62% higher than 2019’s £3.1 billion.

Pre-tax profits more than doubled from £178 million in 2019 to £371 million over the last year, with a loss of £389 million recorded in 2022. Also like Ryanair, it operated above its 2019 capacity.

• Virgin Atlantic

The picture at Virgin Atlantic appears to be a little less cheery than at its competitors. While revenues almost recovered to pre-pandemic levels in the year to 31 December 2022 (£2.85 billion compared to 2019’s £2.92 billion) profitability remained elusive.

Losses grew from £55 million four years ago to £342 million last year - although this marked a large improvement on previous annual losses of £864 million (2020) and £486 million (2021). After a “year of recovery” in 2022, CEO Shai Weiss promised a “year of delivery” in 2023.

• TUI

Given its business includes cruises, hotels and resorts, it is harder to compare TUI’s performance with those of its competitors.

Based purely on airline revenues, TUI’s performance made up most of its lost ground from Covid-19 in the year to 30 September 2022. Flight revenues hit €14.8 billion (£12.7 billion) - up from €4.1 billion (£3.51 billion) in 2021. Compared to 2019’s tally of €16 billion (£13.7 billion), sales were 8% down