International Airlines Group made a profit before tax of €39 million in the first six months of 2011.
The figure is a turnaround from 2010, when the group, made up of British Airways and Iberia, recorded a loss before tax of €419 million.
A strong premium sector and stable long-haul business contributed to the positive results, while the short-haul European market remains “highly competitive”.
IAG said it had already made cost savings since the merger was completed, through joint procurement in areas such as insurance and airport handling.
Willie Walsh, IAG’s CEO, said the firm is “on target to deliver its year one synergies”.
While IAG has managed to cut non-fuel related costs by 5.6% during H1 2011, compared to the same period in 2010, fuel costs have risen by €630 million to €2,439 million, a hike of 35%.
Walsh warned the price of fuel is “still a significant issue”, with the airline group expecting to spend €5.2 billion on fuel by the end of the year.
The recovery of the cost of fuel will become “progressively harder” through the year, he added.