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Lufthansa Group First Half-year Revenues Up by 5.2%

Photo Source: @Lufthansa

Lufthansa Group boosted revenues in the first half of 2018 by 5.2 percent driven by stronger passenger, flight and seat load, the company said on Tuesday.

Europe’s largest carrier reported that first half-year revenues came to 16.9 billion euros, roughly in line with last year with adjusted EBIT at 1,008 million euros only just below the prior-year period while net income remained stable at 677 million euros compared to 672 million euros in the same period last year.

It said it had carried 67 million passengers, a new record for the period.

On the down side, rising costs due to air traffic control strikes, staffing issues, and bad weather had a negative impact on first half-year earnings.

Lufthansa said it expected a slightly weaker capacity growth this year to 8 percent from the initially forecast 8.5 percent, due to Eurowings, citing a delay in bringing 77 Air Berlin planes up to Lufthansa’s standards and 120 million euros in integration costs in the first half of the year, with an additional 50 million euros expected in the third quarter.

Eurowings, which raised its total first half-year revenues to 1.9 billion euros, up by 9.2 percent on the prior-year period, is aiming to return to profit next year.

The Cologne-based airline, Germany’s largest, also raised ticket rate forecasts for the rest of the year, due to growing demand on German and North Atlantic routes following the exit of rival Air Berlin.

“The prime features of Lufthansa Group’s development in the first half of 2018 were strong growth and a simultaneous improvement in our unit revenues. Achieving both simultaneously is a significant success,” said CFO Deutsche Lufthansa AG Ulrik Svensson.

On the announcement of the first-half results, Lufthansa shares shot up by nearly 7 percent, the largest jump in 1.5 years.

“With continuing strong demand, we are confident that, despite a challenging prior-year basis for comparison, we will be able to report solid revenue trends for the second half of 2018, too,” said Svensson.

In relative news, Lufthansa Group appears to still be interested in adding Alitalia to its roster of airlines, travel industry platform Skift reports. Italy’s flag carrier launched insolvency proceedings last year. Lufthansa submitted a bid for the carrier in April, along with EasyJet.

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