Lufthansa sees group profits slump in first quarter
Monday, 05 May, 2010
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Lufthansa dropped deeper into the red in the first quarter of the year as the group suffered from extreme winter weather, a pilots strike and price pressures.
Lufthansa Group posted a net loss of 298 million euros for the first quarter of 2010 against a loss of 267 million euros for the same period a year earlier.
The German group had an operating loss of 330 million euros against a loss of 44 million euros in the equivalent January to March period in 2009.
The Passenger Airline Group business segment saw an increasing rise in traffic revenues during the first three months of the year.
But due to “crisis-related” lower prices, an extreme winter and the pilots union’s strike at Lufthansa and Germanwings in February, the division recorded a heavy operating loss of 373 million euros.
Lufthansa Passenger Airlines contributed a loss of 236 million euros to the negative operating result with Bmi recording a loss of 45 million euros and Germanwings a loss of 34 million euros.
Austrian Airlines contributed 66 million euros and Swiss one million euros
“After a crisis-related decline in demand in 2009, combined with a major slump in prices, the Passenger Airline Group and Logistics business segment were able to significantly improve traffic performance in the traditionally weak first quarter,” Lufthansa said.
“However, the slump in prices continues to place a burden on the result of the Passenger Airline Group. An extreme winter, as well as the strike and the threat of further industrial action by the pilots’ union led to additional revenue losses and follow-up costs.
“All of the airlines in the Passenger Airline Group continue to implement measures to safeguard earnings in an attempt to adjust to the structural changes in the market.”
Lufthansa executive board member and chief financial officer Stephan Gemkow said: “A recovery in demand is not enough to secure a good result, cost efficiency and increasing revenues even further are also absolute musts.
“We have laid the foundations in all business segments and introduced the corresponding measures to safeguard earnings. We remain convinced that Lufthansa shall emerge from the crisis a stronger group.”
by Phil Davies
Phil Davies
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