International Consolidated Airlines Group (IAG) has issued a profit warning after weak sterling values weighed on its balance sheet.

The group's operating profit fell by 3.6% in the company's third quarter.

During the three months it came to €1.21m - it reports that the sterling fall had a €162m impact on its bottom line. Its results are reported in euro - while its UK-based operation, British Airways sells tickets in pounds.

IAG now expects to return a €2.5bn full year profit - that's down from a €3.2bn profit forecast in January.

Chief Executive Willie Walsh said, "While strong, these results were affected by a tough operating environment with a very significant negative currency impact."

The group will pay an interim dividend of €0.11 per share.

A British Airways agreement will see the company contribute more to the company's pension scheme.