German airline Deutsche Lufthansa reported an improved operating result in all its divisions in the first half of 2005, despite rising fuel costs.
Lufthansa's core passenger airline business posted a 78 per cent rise in first-half operating profit to €103 million as passenger yields improved and traffic grew 4 per cent, the airline said today. Yields, or average revenue per passenger carried and kilometre flown, rose 1.6 per cent in the second quarter from a year earlier, helping first-half yields improve slightly by 0.1 per cent.
The news boosted shares in the airline by almost 3 per cent this morning.
Lufthansa's cargo division posted a €20 million first-half operating profit, reversing a year-earlier loss of €3 million.
Fuel costs rose 42 per cent to a record €1.1 billion in the first half, though hedging helped the group cut the bill by €111 million.
"All of our business segments improved their result," said chief executive Wolfgang Mayrhuber in a statement. "We have strengthened our sound financial base."
Lufthansa surprised analysts late yesterday when it reported first-half group operating profit that beat average estimates. The company raised its 2005 operating profit forecast to more than €400 million. It had said it expected profit to remain at last year's level of €383 million.
The company said it has implemented savings measures worth €606 million so far this year, compared with a target for 2005 of €780 million.
