BERLIN: Lufthansa on Thursday reported quarterly profits slightly above analysts’ consensus on the back of robust travel demand this summer and said bookings remained strong ahead of the busy Christmas holiday season.
Europe’s airlines have reported record quarterly profits as consumers have kept travelling despite a cost of living crisis, but the outlook has been clouded by rising oil prices due to conflict in the Middle East and risks of recession, hitting share prices.
Lufthansa reported third-quarter adjusted earnings before interest and tax (EBIT) of 1.47 billion euros ($1.56 billion), up 31% year-on-year and slightly above average expectations for 1.43 billion in an analyst consensus published on the company’s website.
“Even though the geopolitical situation remains challenging, our booking outlook gives us reason to be positive - not only for a very good group result this year, but also beyond,” Chief Executive Carsten Spohr said.
Lufthansa said bookings for the fourth quarter were up by double-digit percentages year-on-year.
Demand for both short-haul and long-haul flights remained high, especially among leisure travellers, it said, and the trend towards more bookings in pricey premium classes continued.
Costs were 0.9% lower than the same quarter last year despite rising inflation, while net profits were at 1.2 billion euros.
Because of the falling costs and higher flight demand, the group expects to post a positive operating result for the fourth quarter, helping it achieve its aim of an adjusted group EBIT of more than 2.6 billion euros for the full year 2023.
Next year, Lufthansa expects the amount of seating capacity available to fliers to increase further to around 95% of pre-pandemic levels.
Capacity will increase to 91% of pre-pandemic levels in the fourth quarter, they said.
“We continue to see a more cautious pace of capacity restoration at Lufthansa vs other European peers … likely a sensible move given the increasingly permanent-looking impairment in the key corporate segment,” said Bernstein analyst Alex Irving in a note.
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