Lufthansa profits soar, says crisis over

28th October 2010, Comments 0 comments

German flag carrier Lufhansa said Thursday it tripled its net profit in the third quarter, easily beating market expectations on the back of a robust economic recovery.

The airline said third quarter net profit came in at 628 million euros (868 million dollars), far higher than the 390 million euros forecast by analysts polled by Dow Jones Newswires.

Operating profit soared to 783 million euros, more than 500 million euros higher than during the same period last year, Lufthansa said in a statement.

"The good result is the consequence of the increasingly positive development of demand in passenger and freight traffic," it said, adding that in-house cost-cutting and synergy within its group of airlines had also driven profits.

"The Lufthansa Group has successfully flown through the economic and financial crisis."

The group also owns Austrian Airlines, Swiss, Britain's BMI as well as Germanwings.

In 2009, the company launched a drive to slash one billion euros in spending by the end of 2011, sparking tensions with staff including pilots, who went on strike in February.

But following that turbulence in the first quarter and major disruptions in the second due to the Icelandic ash cloud, the third quarter marked a resounding improvement.

Lufthansa gave a sunny outlook for the remainder of the year -- barring an economic slowdown or a major hike in fuel prices.

The company now expects operating profit to exceed 800 million euros this year, driven mainly by a strong rebound in long-haul passenger and freight traffic as well as reduced costs.

It criticised government plans to introduce a new tax on flights of eight, 25 or 45 euros, payable by passengers depending on the length, saying it could drive business to foreign airports.

© 2010 AFP

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