British Airways Stutters as Sister Units Power IAG Traffic Gain

(Bloomberg) -- British Airways owner IAG SA's Irish and Spanish businesses spurred gains in passenger traffic at the company last year as expansion at the U.K. arm slowed.

Dublin-based Aer Lingus, purchased by IAG in 2015, posted a 12 percent traffic increase, while the advance at Madrid-based Iberia accelerated to 7.6 percent, according to a statement from the group Thursday.

London-based IAG, as International Consolidated Airlines Group SA is known, has been pouring resources into a turnaround of Iberia and Aer Lingus, historically two of Europe's worst-performing carriers.

BA's traffic growth slipped to 1.5 percent as it almost froze capacity to combat a glut in seats and bolster fares. The unit's earnings have begun to recover from 2016's Brexit vote, which triggered a slump in the pound, reducing the value of sales converted into euros, IAG's reporting currency.

Expansion also slowed at Barcelona-based discount carrier Vueling, which reported a 3.8 percent increase in traffic, a measure of passengers carried times the distance flown that's a standard airline-performance indicator.

IAG's overall traffic also rose 3.8 percent, slowing from a 4.5 percent gain in 2016, while the passenger tally was up 4.1 percent to almost 105 million.

The company didn't break out figures for its Level unit, a low-cost, long-haul operation that has begun flying from Barcelona and plans to add services from Paris this year. The unit's traffic is currently included with Iberia's numbers.

--With assistance from Richard Weiss

To contact the reporter on this story: Christopher Jasper in London at cjasper@bloomberg.net.

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net, Tom Lavell

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