International Airlines Regulatory News (IAG)

JUNE 2013 - IAG GROUP TRAFFIC AND CAPACITY STATISTICS

§ In June 2013, Group traffic measured in Revenue Passenger Kilometres increased by 8.2 per cent versus June 2012 (up 0.1 per cent on a pro-forma basis); Group capacity measured in Available Seat Kilometres rose by 7.4 per cent (down 1.5 per cent on a pro-forma basis).

§ Group premium traffic for the month of June increased by 1.9 per cent compared to the previous year.

§ Underlying market conditions remain unchanged from those described at the publication of Quarter One results on 10th May.

3 July 2013

STRATEGIC DEVELOPMENTS

On 26 June, IAG announced the successful launched by British Airways of a $927 million publicly-traded bond, using aircraft as collateral. These bonds are known as EETCs (Enhanced Equipment Trust Certificates) and are a form of aircraft financing commonly used by US airlines. The transaction included Class A and Class B Certificates, with an annual coupon of 4.625% and 5.625%, respectively. The underlying collateral pool is made up of six new B787-8 aircraft, two new B777-300 ER aircraft and six new A320-200 aircraft, due for delivery within the next 12 months. This is the first time that British Airways has used EETCs and the first time this form of financing has been used in the UK.

On 27 June, Vueling Airlines, of which IAG owns 90.51 per cent, agreed at a general shareholders meeting to delist the remaining 9.49 per cent of shares from the Barcelona, Bilbao, Madrid and Valencia Stock Exchanges.

British Airways has received the first two of its 24 strong order of Boeing 787 Dreamliners. The two aircraft will begin commercial long-haul flying later this year with services to Toronto due to start from September 1 and Newark from October 1, subject to regulatory approval.

In June, Iberia began its seasonal operations to Dubrovnik and Zagreb in Croatia until mid September. The airline offers up to four services per week to Dubrovnik and two flights per week to Zagreb.

Certain information included in these statements is forward-looking and involves risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements. Forward-looking statements include, without limitation, projections relating to results of operations and financial conditions and the Company's plans and objectives for future operations, including, without limitation, discussions of the Company's Business Plan, expected future revenues, financing plans and expected expenditures and divestments. All forward-looking statements in this report are based upon information known to the Company on the date of this report. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

It is not reasonably possible to itemise all of the many factors and specific events that could cause the Company's forward-looking statements to be incorrect or that could otherwise have a material adverse effect on the future operations or results of an airline operating in the global economy. Further information on the primary risks to the Company and its risk management process is given in the Annual Report and Accounts 2012; this document is available on www.iagshares.com.

1 Group performance comprises British Airways, Iberia (including Iberia Express) and Vueling. Year to Date 2013 includes Vueling from May 2013. Vueling traffic is currently accounted as non-premium traffic.

2 Monthly pro-forma includes Vueling in the baseline.

3For Year to Date pro-forma, Vueling data is only included from May 2012/13.