IAG SA sets sights on dividend resumption amid travel surge

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IAG SA sets sights on dividend resumption amid travel surge
Credit: © Reuters.

LONDON - International Consolidated Airlines Group (LON: ICAG ) (IAG), the owner of British Airways and Iberia, is charting a course toward financial stability with plans to reinstate dividends, paused since the pandemic's onset in 2019. The group, which had to scrap its planned 2020 payout due to the global health crisis, now sees a resurgence in travel demand bolstering its balance sheet.

At an investor briefing today, IAG outlined ambitious financial targets, aiming for an operating margin between 12% and 15% and a return on invested capital of 13% to 16%. This strategic financial planning follows in the wake of Ryanair's recent announcement of a €400 million (EUR1 = USD1.0945) dividend, signaling a broader recovery trend within the airline industry.

The London and Madrid-traded conglomerate emphasized that the revival of shareholder dividends is contingent upon maintaining this newfound financial stability. The airline industry, hit hard by the pandemic, is now witnessing a robust rebound as travel restrictions ease and passenger confidence returns.

IAG's focus on solid investment plans and prudent financial management aims to ensure that the group can sustainably support dividend payments moving forward. Investors and stakeholders alike are monitoring these developments closely as IAG works towards achieving its medium-term financial objectives.

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