Lufthansa flies back to black on cargo boom, easing travel curbs

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  • feature. EBIT 17 million euros
  • Expected capacity increase in 2022
  • The shipping business recorded a profit of 301 million euros
  • 6% share

BERLIN (Reuters) – Germany’s Lufthansa said on Wednesday it expects continued high demand for its booming freight business and a recovery in passenger flights next year, after reporting its first core operating profit since the coronavirus crisis. .

The group reported adjusted EBIT of €17 million ($20 million) in the third quarter, versus a loss of €1.262 billion a year earlier, buoyed by strong shipping business and increased demand during the summer season as travel restrictions ease.

“We’ve mastered another milestone on our way out of the crisis: we’re back in the black,” CEO Carsten Spohr said.

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Analysts in a survey provided by the company expected an adjusted EBIT loss of 33 million euros.

Air freight company Lufthansa reported a record adjusted profit of €301 million, as demand and air freight rates soared due to ocean freight bottlenecks and disruption to global supply chains.

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“The favorable gap between supply and demand will continue at least until 2022, but with a high degree of probability beyond that,” Spohr said.

The company’s revenue in the third quarter nearly doubled to 5.2 billion euros, compared to analysts’ expectations of 5.5 billion euros.

Lufthansa planes parked on the tarmac at Frankfurt Airport, Germany, June 25, 2020. (Reuters) / Kai Waffenbach

Lufthansa, which also owns Eurowings, Swiss, Brussels and Austria Airlines, said it expects demand to develop positively, leading to positive EBITDA in the fourth quarter.

It said third-quarter capacity, measured in available seats in kilometres, was 50% of its pre-crisis level. It expects capacity for 2022 to rise to more than 70% from the 2019 level.

“The positive development will continue up to 80% in the second half of the year,” Spohr added.

The airline said new bookings are currently at 80% of 2019 levels, driven by a recovery in business bookings and increased demand for long-haul flights, particularly to the United States, Lufthansa’s most important and profitable market.

With the US opening to travelers from Europe next week, Spohr said bookings across the Atlantic were already about 80% of pre-crisis levels, adding that he expects mainland China to open in mid-2022 rather than early next year.

Lufthansa shares were up 6.1% at 1101 GMT, the second best performer on the German medium-sized index MDAX (.MDAXI).

The group, which last year received a lifeline of 9 billion euros in public funding to stay afloat, said it expects capital expenditures of around 2 billion euros next year and is targeting 2.5 billion euros a year in the long term.

(1 dollar = 0.8634 euros)

(Covering) Ilona Weisenbach and Riham Elkousa Editing by Sherry Jacob Phillips and Mark Potter

Our Standards: Thomson Reuters Trust Principles.

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