Lufthansa sees major profit increase

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28 Jul, 2011 Updated Thu 28 Jul 2011 11:29 CEST
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Lufthansa on Thursday posted second quarter net profits of more than €300 million, a 55.2 percent rise on the same period last year when Iceland's volcanic eruption hit the industry.

Lufthansa reported a net profit of €301 million ($432 million) for the three months from April through June, a company statement said.

Operating profit was 44.7 percent higher at €230 million, a sum that nonetheless fell well below an average analyst forecast compiled by Dow Jones Newswires of €318 million.

Obstacles faced this year included the Japanese earthquake, tsunami and nuclear disaster, and political unrest in North Africa, the airline noted.

Shares in Lufthansa plunged in early Frankfurt trading, showing a loss of 2.83 percent to €14.065, while the DAX index on which they are listed was 1.07 percent lower overall.

"Lufthansa remains among the profitable airlines in the world even after six months of strong headwinds," finance director Stephan Gemkow was quoted as saying.

The airline expects the situation in Japan to improve but saw additional challenges in high oil prices and "competitive pressure in certain markets."

Charges related to hedging its fuel costs had forced Lufthansa to post a net loss of €507 million in the first quarter of the year.

It reiterated Thursday however its full-year forecast for higher sales and operating profit than in 2010, citing "the prospect of a positive development of business during the coming six months."

On Wednesday Lufthansa had reported a net loss of €206 million for the first half of 2011 but said it did manage to turn a small operating profit of €3 million over the period.

The group, which also includes Swiss, Austrian Airlines and BMI, had posted a net loss of €104 million in the corresponding period in 2010.

The company's €3 million operating profit in the first half stood in contrast to an operating loss of €174 million a year earlier.

Sales were €14.1 billion over the same period, a gain of 11.4 percent.

The Local/AFP



2011/07/28 11:29

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