Lufthansa targets higher profit and sales in 2011-12

17th March 2011, Comments 0 comments

The leading German airline, Lufthansa, forecast Thursday improved operating profit and sales for this year and next even though 2011 "will not be a walk in the park."

For 2010, the Lufthansa group reported an operating profit of 876 million euros ($1.2 billion) on sales that reached 27.3 billion.

"The company expects a further increase in revenue and the operating result, and as things currently stand, the conditions for a dividend payout should also be fulfilled for this year," a statement said.

For 2010, the airline plans to pay a dividend of 60 euro cents per share.

But Lufthansa chairman Christoph Franz stressed that "2011 will not be a walk in the park."

Competition is getting tougher on routes in Europe and on those to Asia and the Americas, the company noted.

In addition, a German air traffic tax will hit German and other European airlines, and the carrier has to deal with "record" fuel prices as well as the consequences of political unrest, terrorist attacks and natural disasters.

Group finance director Stephan Gemkow told a press conference that Lufthansa spent almost 5.2 billion euros for fuel last year, an annualised jump of 42 percent owing to higher prices, greater volumes and a rise in the value of the dollar.

He forecast a further jump of 30 percent this year to 6.8 billion euros, which would top the group's 2008 record of 5.4 billion.

The airline released many 2010 results last week, including a net profit of 1.1 billion euros, compared with a loss of 34 million in 2009.

It has benefitted from a rebound in passenger and freight traffic, and a major restructuring programme has also begun to bear fruit.

Most recently the German carrier acquired Austrian Airlines and BMI and is turning around their operations as well.

Lufthansa has restructured regional activities and begun using four Airbus A380 superjumbo jets on intercontinental routes.

It is to take delivery of four more A380s this year, including two this month, and announced late Wednesday an order of 30 Airbus A320 planes and five Boeing 777 cargo jets for a total catalogue price of four billion euros.

© 2011 AFP

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