Friday, July 12, 2024
Cargo demand and cost cutting help Lufthansa Cargo return to profit

Cargo demand and cost cutting help Lufthansa Cargo return to profit

Lufthansa Cargo has returned to profit in the first quarter due to recovery in cargo demand and its cost reduction program.

The Logistics division, which includes Lufthansa Cargo, made an earnings before interest and tax (EBIT) profit of €33 million ($36 million) compared to a loss of €19 million between January and March 2016. Lufthansa Cargo made an EBIT loss of €50 million in 2016.

Lufthansa Cargo started its partnership with Cathay Pacific Cargo and started expanding the Lufthansa Cargo Cool Center in the period.

Revenue grew 18.5 per cent to €569 million due to volumes increasing and pricing, with revenue cargo tonne kilometres up 6.3 per cent to two billion due to strong growth in all regions of the world except Middle East/Africa, which declined 7.8 per cent.

Capacity grew by 2.8 per cent to 2.9 billion available cargo tonne kilometres, with reductions in Europe and Middle East/Africa, and load factors increased 2.3 percentage points to 70.1 per cent.

Deutsche Lufthansa chief financial officer, Ulrik Svensson says: “For a period that is traditionally difficult for the airline industry, we have posted our first positive earnings result since 2008. This is mainly attributable to favourable trends at Lufthansa Cargo and strong growth at Lufthansa Technik. This demonstrates the strength of our broad setup as aviation group.”

Total revenue for the Lufthansa Group was up 11.2 per cent to €7.7 billion and adjusted EBIT was €25 million compared to €53 million in 2016. Net loss for the period increased to €68 million compared to €8 million last year.

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