International Consolidated Airlines in confident mood

Spending €202m on restructuring at Iberia and writing down the value of the Spanish airline's assets by €343m scarred the bottom line. Still, strip that out and the operating loss was just €68m - or €23m after ignoring other one-offs - compared with guidance in November for a €120m shortfall. A €347m profit at British Airways was more than expected and compensated for a €351m loss at Iberia, also slightly better than feared. So was a fourth quarter underlying loss of just €40m - thanks to the speedy integration of bmi, which made up for struggling Iberia.

Cost savings of €313m were well above the €225m target, too, but chief executive Willie Walsh admits the outcome for 2013 depends largely on fixing Iberia. Workers there have started a series of five-day strikes in protest, yet IAG has already started the process of sacking more than 3,800 workers and cutting pay for the rest. It plans to reduce capacity by 15 per cent and begin a €600m turnaround in profits there. Of course, industrial action is costly, but Mr Walsh still thinks this year's underlying operating profit will top the €485m it made in 2011. Investec Securities believes it could be as much as €505.4m.