British Airways’ owner IAG on Friday made a bold bet on Brexit Britain, with boss Willie Walsh ready to invest an average €500 million (£440 million) extra a year in the firm.

The Irishman declared he is not “afraid to make investments” as he upped the firm’s spend for across the business, likely to cover new planes, products and customer services, to €2.6 billion a year for a five-year period.

The chief executive was bullish as he addressed a capital markets day in London, updating the City on new goals for 2019-2023.

Walsh said: “We are in a position to look forward with great confidence to invest.”

IAG expects average seat kilometres, a measure of capacity, to increase by 6% per year.

Aer Lingus and Iberia parent IAG also cheered investors by setting out its aim to boost annual profit to €7.2 billion, up 11% from its previous guidance. Its other key goals were unchanged.

The City piled into IAG, sending the shares to their highest levels since May. The shares, which are approaching 20-year highs, rose 9.6p to 627.6p.

The upbeat update comes despite gloom in the aviation industry, which has been grappling with soaring oil prices, air traffic controller strikes and Brexit uncertainty. A number of smaller European airlines have collapsed.

Liberum analyst Gerald Khoo said it was “positive that the targets have gone up despite a tougher fuel cost environment”.

City Index analyst Fiona Cincotta said IAG is “dancing out of line with the rest of the industry”.

IAG chairman Antonio Vazquez Romero gave the latest update on Brexit. He said the FTSE 100 firm is “confident” it “will be able to operate as normal” once Britain leaves the bloc in March next year.

Romero added the group has contingency plans should the withdrawal occur without a post-Brexit agreement between the UK and the EU.

The capital markets day comes a week after Walsh apologised after it emerged that another 185,000 customers may have had personal details stolen in a cyberattack first reported in September, when it said 380,000 transactions were affected.

However, Walsh was positive last week despite pre-tax profits slipping 0.4% to €1.42 billion in the three months to September, hurt by currency headwinds and higher fuel costs.

IAG had some “marginal benefits” picking up work when smaller airlines, such as Cobalt Air, collapsed.