(Corrects to show revenue per passenger (not revenue) up 1%; fuel unit costs (not unit costs including fuel) up 6.3%, paragraph 6)
* Profit beats forecast by 5%
* On course for FY profit target
* No bookings impact from Brexit
* CEO not worried about overcapacity
* Shares up 4.2% at 0715 GMT
By Conor Humphries
DUBLIN, Aug 2 (Reuters) - British Airways owner IAG gave an optimistic outlook for the year, lifting its shares on Friday, as it exceeded profit forecasts for the first half of its key summer period with growing revenues and easing fuel cost growth.
And IAG Chief Executive Willie Walsh said he “would like to hope” that British Airways could reach a deal with its pilots, who last month overwhelmingly voted for strike action in a dispute over pay. They have not yet served notice.
“Despite fuel cost headwinds, we delivered a good performance,” Walsh said in a statement, adding that unit revenue and non-fuel costs would improve for the rest of 2019.
IAG shares were up 4.2% at 0715 GMT and were the top gainer in Europe’s STOXX 600 index, which was down 1.6%, after the owner of Iberia, Aer Lingus and Vueling, said second-quarter operating profit had risen to 960 million euros ($1.1 billion).
This was 5% ahead of the 914 million forecast by a company poll of analysts, and up from 900 million last year.
IAG said its revenue per passenger was up 1% and growth in fuel unit costs came in better than expected at 6.3% on a constant currency basis.
“Given all the uncertainties over global growth and Brexit, this looks to be a very strong statement by the company and implies that forward bookings are trending well,” Goodbody analyst Mark Simpson said in a note.
Days after rival Lufthansa cited intense short-haul competition in Europe for pushing profits down 25%, Walsh said he was not too concerned about oversupply.
“We think the supply environment is going to be OK, certainly in the fourth quarter and going into the first quarter of next year,” he told journalists in a conference call, saying he planned to taper growth in the last three months of the year.
“The economic environment is clearly softening, but it is still reasonably good,” he added.
While Walsh said he was worried about the economic impact of Britain’s plan to leave the European Union on Oct. 31, he had not yet seen any impact on bookings. ($1 = 0.9022 euros) (Reporting by Conor Humphries; editing by David Evans and Alexander Smith)