The owner of British Airways, International Airlines Group (IAG), is set to launch a share buyback program amid a robust recovery from the financial impacts of the pandemic.

The company will initiate a €350 million share repurchase, a strategy utilized by firms with surplus cash to enhance their stock value, in addition to resuming dividend payments to investors.

Following a stagnant period over the past three years, IAG shares surged after the dividend report in August, marking their highest trading values since the market downturn caused by Covid-19 in early 2020.

Recently, IAG shares have experienced a 45 percent surge over the last quarter, with a rise of 15p, or 7.2 percent, on Friday, culminating in a closing price of 234½p.

International Consolidated Airlines Group operates major airlines from Heathrow, Madrid-Barajas, and Dublin airports, including British Airways, Iberia, Aer Lingus, and Vueling, a popular short-haul airline in Spain. The organization primarily serves routes across the North and South Atlantic to the US and Latin America, as well as intra-European flights.

In the third quarter, coinciding with the peak summer travel season, IAG reported an operating profit increase of 15 percent, exceeding €2 billion, with revenues climbing nearly 8 percent to €9.3 billion. The company achieved profit margins reaching 21.6 percent in this quarter, a coveted figure in the airline sector that is infrequently realized.

For the initial nine months of the year, IAG reported pre-tax profits of €2.34 billion, an increase of nearly 9 percent.

In contrast, Ryanair, the largest airline in Europe, reported an 18 percent decline in profits this week, attributed to passenger decreases due to rising fares.

However, IAG did not encounter similar challenges, celebrating a 1.2 percent increase in revenue per passenger per kilometer flown.

The airline highlighted strong demand within its European network, a growing market in Latin America, and a robust performance in the North Atlantic region. British Airways, well-known for its lucrative London-New York flights, continues to be a key revenue driver.

As the airline experiences a cash influx, it has successfully reduced its net debt by over €3 billion, now standing at less than €6.2 billion, a significant improvement from its peak net debt of over €12 billion during the pandemic.

Chief Executive Luis Gallego, who led the company through turbulent times, stated, “We achieved a very strong financial performance in the third quarter. Demand across our airlines remains robust, and we anticipate a favorable financial outcome for the final quarter of 2024.”

British Airways reported impressive results, notably in premium economy, which is attracting passengers willing to pay significantly more than economy class fares, even if business and first-class occupancy has not fully recovered.

BA generated operating earnings of €830 million in the summer quarter, marking a 43 percent increase from the previous year. Over the first nine months, operating profits have surged by 28 percent year-on-year, approaching €1.4 billion, significantly outpacing other group airlines.

This surge countered a substantial decline in profits for Aer Lingus, which faced challenges due to a pilot strike over compensation issues.

British Airways’ rebound has occurred despite not having fully reinstated its Eastern routes. CEO Sean Doyle noted that the airline will continue to concentrate on the North Atlantic routes until it can reestablish its presence in the competitive Europe-Asia market once new aircraft join the fleet.