Germany's Deutsche Lufthansa said it was sticking to its full-year earnings forecast despite a challenging business environment including the impact of record oil prices.
"Despite the higher fuel cost ... the executive board confirms its outlook that the group's operating result for the full year 2008 will follow up on the previous year's record level," Lufthansa said today.
Lufthansa had said after reporting first-quarter results that beat expectations in April that it wanted to match last year's operating result of €1.38 billion and increase it if possible provided conditions did not worsen.
"Overall Lufthansa remains confident that the demand for mobility will continue to increase and that despite fluctuations air traffic will carry on growing," Lufthansa said in a statement. "The current environment, particularly the high kerosene prices, does however represent a considerable challenge for the airline industry."
Lufthansa said it was expecting full-year fuel costs of around €5.63 billion, up from €3.9 billion in 2007. The carrier had raised its estimate earlier this month to €5.7 billion euros from €5.26 billion.
The bill could range from as much as €5.89 billion with oil at $154.5 a barrel to €5.39 billion with oil at $103 a barrel, Lufthansa finance chief Stephan Gemkow illustrated on the company's website.
Lufthansa was hedged for 85 per cent of its 2008 fuel needs and would see benefits with the price above $74 a barrel. The carrier said it would compensate for higher costs through efficiency gains, cost savings and fuel surcharges imposed on passengers.
Meanwhile, the airline was due to receive almost 150 new aircraft in the next seven years, it said.