Lufthansa nosedives into the red
AFP · 28 Oct 2009, 17:36
Published: 28 Oct 2009 17:36 GMT+01:00
Lufthansa reported a net loss of €32 million ($47 million) from a profit of €529 million over the same period last year, a result that was better than expected but still sent the airline's shares plunging.
Analysts polled by Dow Jones Newswires had forecast a much larger nine-month net loss of €231 million.
Lufthansa's "positive outlook for the year remains subject to very considerable risks," a statement from the airline said.
It added that it expected "negative earnings contributions from the new companies in the airline group over the months ahead."
Lufthansa's sales in the first nine months of the year fell by 13.2 percent to 16.2 billion euros, while operating profit plummeted by 76.3 percent to €226 million, it said in a brief statement to the financial markets.
Full third-quarter results from the airline are to be released on Thursday. The carrier said it was operating "against the background of a persistently difficult environment characterised by continuing demand and price weakness."
An additional risk was posed by a renewed increase in oil prices.
"A sharp drop in revenue and continued pressure on earnings is therefore expected for the full year," the statement said.
With the possibility that Austrian Airlines and British Midland would weigh on the results in the fourth quarter, Lufthansa said its business performance would be a decisive factor in whether "the goal of a positive operating result for the now expanded group can still be achieved."
UniCredit analyst Uwe Weinreich commented that "the fourth quarter would have to be very bad indeed if the 226 million euros operating profit after nine months were to be eaten up completely."
The warning from Lufthansa spooked investors and shares in the airline fell by 4.69 percent to €10.45 in afternoon trading, while the Frankfurt DAX index of leading shares was 1.98 percent lower overall.
The German carrier has struggled to deal with effects from a global slowdown in airline travel, even though the summer holidays boosted its numbers in recent months.
In mid July it announced additional cost cuts, in part by shedding office staff, to save €1 billion per year from 2011.