LONDON, March 26, 2026, 18:27 GMT
Shares in British Airways owner International Consolidated Airlines Group fell about 2% to roughly 359 pence on Thursday, even after the airline group disclosed a capital reduction tied to the cancellation of 115.5 million treasury shares. The drop left the stock around 23% below the 52-week high it reached on Feb. 27. 1
The filing matters because it retires stock bought under a 1 billion euro repurchase completed in November and keeps alive IAG’s shareholder-return drive. That effort was extended on Feb. 26 with a new 500 million euro buyback whose stated purpose was also to reduce share capital. 2
In its March 24 statement, IAG said it had reduced share capital by 11.553 million euros through the cancellation of 115,531,620 treasury shares — stock the company had bought back and was holding on its own books. It said it still held 89,529,783 treasury shares afterward, leaving 4,522,139,744 shares outstanding. 3
Thursday’s slide was part of a wider selloff rather than a company-only move. Britain’s FTSE 100 closed down 1.3% and the pan-European STOXX 600 fell 1.2% as Middle East tensions kept inflation fears alive and snapped a brief rally in regional equities. 4
The market is still trading off what IAG said on Feb. 27. The group reported 2025 operating profit before exceptional items of 5.02 billion euros, slightly ahead of analyst forecasts, and pledged 1.5 billion euros of shareholder returns over the following 12 months, but the shares still fell 6% that day as investors focused on missing 2026 guidance detail and fuel risk. Chief Executive Luis Gallego said then that “since Q3 we have seen a rebound,” pointing to strong first-quarter bookings and firm premium and corporate demand at British Airways. 5
On fuel, management has tried to hold the line. Reuters reported on March 10 that IAG said it was well hedged in the near term — meaning it had locked in part of its fuel bill in advance — and had no immediate plans to raise fares, even as jet-fuel prices surged to roughly $150-$200 a barrel from about $85-$90 before the latest Middle East shock. 6
That backdrop is not unique to IAG. Reuters reported this month that a sustained 10% rise in jet-fuel prices could cut operating profit by 3% to 10% at IAG, Air France-KLM, Lufthansa and Ryanair, citing J.P. Morgan, while Bank of America’s Nathan Gee said airlines serving more price-sensitive passengers “get squeezed the most in this environment.” 7
There are company-specific risks too. Aer Lingus Chief Executive Lynne Embleton said on Wednesday there was a “serious risk” that the United States could retaliate over Dublin Airport’s passenger cap by restricting Irish carriers’ transatlantic flights, and Morningstar analyst Nicolas Owens has warned that March’s fuel jump will hit airline profitability. For investors, that leaves IAG with a smaller share count, yes, but still a messy list of things to prove. 8
