Lufthansa has reported strong results for the three months to June, with a quarterly profit of €881 million despite passenger numbers remaining 16% below the 2019 level due to restraints on capacity.
Carsten Spohr, Lufthansa Group chief executive, hailed “the financially best second quarter in our history” and said: “We were able to avoid a situation like last summer and offer our customers a more stable operation.”
The group, comprising Lufthansa, Swiss, Austrian Airlines, Brussels Airlines and Eurowings, reported a €414 million profit for the first half of the year amid “continued strong demand and high yields”.
All the group’s airlines made a profit, with “high global demand for air travel” leading to “a significant increase in passenger numbers” to 55 million in the six months, 30% up on 2022.
More than 33 million passengers flew with the group in the three months to June, 84% of the 2019 level.
Capacity across the group was 19% above the level of 2022 but remained 21% below pre-pandemic levels across the half year although it rose to 83% of the 2019 level in the second quarter.
Lufthansa noted: “Capacity was planned conservatively due to bottlenecks, particularly with [ground] handling service providers and air traffic control.”
But it reported: “Persistently high demand, especially in the premium classes, coupled with restricted capacity led to a 13% increase in yields for the passenger airlines compared with the previous year.”
That compared to a 7% rise in unit costs year on year.
The group took €9.4 billion in revenue in the quarter to June, 17% up year on year and reported an operating profit of €1.1 billion. Revenues in the first half of the year were €16.4 billion.
Lufthansa’s net debt fell to €5.9 billion at the end of June, down from €6.9 billion at the end of December and below the pre-pandemic level.
Spohr noted “three significant transactions” in the April to June quarter with the acquisition of a 41% stake in Italian airline ITA Airways in May, the sale of the group’s remaining catering business to a private equity company in April and the sale of payment services provider AirPlus in June.
The ITA deal allows Lufthansa to acquire the remaining shares in the Italian carrier in future, although the acquisition remains subject to regulatory approval.
The group reported hiring 9,000 new employees so far this year, more than 1,000 a month.
It forecast demand for flights would remain high for the rest of the year “especially in premium classes, mainly driven by leisure travellers”, leading to a further “slight increase” in yields.
However, capacity will remain restrained “due to persisting bottlenecks in the European air traffic system”, with Lufthansa planning to operate 88% of its pre-pandemic capacity in the three months to September.
The group noted demand for business travel is increasing but it expects corporate demand to recover only to 70% of the 2019 level by the end of the year.
Spohr forecast Lufthansa’s full-year results would be among “the three best in the history of the group”.