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Lifted by cheap fuel, Lufthansa triples profit

German airline Lufthansa, still reeling from the crash of one of its Germanwings planes in March over the French Alps, said on Thursday it tripled net profit in the second quarter, helped by cheap fuel.

Lifted by cheap fuel, Lufthansa triples profit
Photo: DPA

The company posted “solid results” in the April-to-June period, although earnings “were strongly impacted by external effects”, chief financial officer Simone Menne told a telephone conference.

Net profit soared to €529 million ($580 million) during the second quarter, up from €173 million one year ago.

The report beat the expectations of analysts polled by financial services company Factset, whose average forecast was €279 million.

Among the fortuitous factors for the company were low fuel prices and a rise in interest rates which automatically eased pressure on the airline to top up guaranteed pension levels.

Such effects outweighed the weakness of the euro against the US dollar, which put pressure on earnings, costing €158 million during the first half.

Turnover climbed by nearly nine percent to €8.4 billion during the second quarter despite a decline in per-passenger income of nearly six percent due to ferocious competition in the sector driving down prices.

During the first half, when the airline was hit by crippling pilot strikes which cost €100 million, net profit reached €954 million compared to a net loss of €79 million during the same period in 2014.

Menne said the second half would be “more demanding”.

“The pressure on income per passenger will continue and we will no longer have some of the positive effects seen in the first half,” she said.

Lufthansa confirmed its forecast of adjusted earnings before interest and taxes for the year of more than €1.5 billion.

The airline has been in the headlines constantly over the Germanwings crash in the French Alps on March 24th that killed 150 people, which has been blamed on a suicidal co-pilot.

Lufthansa was forced this month to defend its treatment of families of victims, saying a settlement offer it made had gone “well beyond” what was required by law.

Relatives of German victims have turned down the parent company's compensation offer and accused it of ignoring their suffering.

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MALLORCA

Lufthansa fires up ‘jumbo jet’ for surge in German tourists bound for Mallorca

German airline Lufthansa said Friday it was taking "extraordinary measures" to meet surging bookings for the Spanish holiday island of Mallorca, deploying a jumbo jet to ferry passengers from Frankfurt.

Lufthansa fires up 'jumbo jet' for surge in German tourists bound for Mallorca
Tourists enjoy the first days of summer on the island of Mallorca. Photo: picture alliance/dpa/AP | Francisco Ubilla

The group said it had seen a jump in reservations from German sunseekers in recent weeks, as concerns about the pandemic ease thanks to falling infection numbers and vaccination progress across Europe.

To meet demand, Lufthansa said it would swap the 215-seat Airbus A321 that usually plies the Frankfurt-Mallorca route for its Boeing 747-8 “jumbo jet”.The 747, also known as the “Queen of the Skies”, can carry 364 people and is the largest plane in Lufthansa’s fleet.

The super-large planes normally fly transatlantic routes but have been
mostly grounded since the pandemic upended air travel.

READ ALSO: ‘I really needed a break’: Pandemic-weary Germans find freedom on Mallorca

“Lufthansa is taking extraordinary measures in order to respond to a significant increase in booking demand for flights to Palma de Mallorca,” the airline said in a statement.

The jumbo jet will be used for four weekends over July and August, it added, Europe’s key summer travel season.

Mallorca is one of the most popular tourist destinations for Germans and is sometimes affectionately referred to as Germany’s “17th state”.

Before the pandemic, around five million German tourists visited the island
each year.

READ ALSO: ‘Germans are coming back’: Spaniards sceptical over return of tourists

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