Lufthansa (FRA:LHA)

QUOTE AND NEWS
Flightglobal  7 hrs ago  Comment 
Lufthansa is trialling use of a kerosene additive to remove water from fuel tanks on board aircraft.
Financial Times  Jul 31  Comment 
Provident Financial rebounds as interim results reassure
Financial Times  Jul 31  Comment 
German airline’s earnings beat expectations and send shares higher
Flightglobal  Jul 31  Comment 
Lufthansa is "well prepared" for the arrival of additional competition at Vienna airport, argues the airline group's finance chief Ulrik Svensson.
Flightglobal  Jul 31  Comment 
Lufthansa Group has reported an operating profit down 3.2% at 983 million ($1.15 billion) for the second quarter, citing a "stressful period" for Eurowing.
The Economic Times  Jul 29  Comment 
Munich airport’s terminal 2 was shut down on Saturday morning after a woman entered the security zone without going through security and passport controls.
Reuters  Jul 20  Comment 
A court in Britain will start proceedings on Nov. 19 in a case between Lufthansa and Laudamotion over leasing contracts, Lufthansa said on Friday.
Channel News Asia  Jul 16  Comment 
Austrian leisure airline Laudamotion said on Monday it had always paid its bills for planes leased from Lufthansa in full and on time, rejecting allegations made by the German rival.
Reuters  Jul 13  Comment 
Lufthansa plans to end an agreement to lease planes to Laudamotion, saying the Austrian holiday airline has failed to meet payments, leading to a dispute with its backer Ryanair.




 

Deutsche Lufthansa AG (FRA:LHA) is a German airline with five business segments: scheduled passenger air traffic, scheduled airfreight services, maintenance, repair and overhaul (MRO), information technology, and catering.

Lufthansa operates the following airlines: Deutsche Lufthansa AG, Lufthansa CityLine GmbH, Swiss International Airlines AG, Austrian Airlines AG, British Midland Ltd., Air Dolomiti S.p.A., Eurowings Luftverkehrs AG, and Germanwings GmbH.

Business Growth

Lufthansa's operating profit came to €876 million in 2010, more than five times higher than in 2009. Lufthansa's net profit for 2010 was €1.1 billion.[1] Lufthansa's sharp increase in profitability is due to the combination of strong sales in international passenger traffic and cargo and cost-cutting measures.

Trends and Forces

Rising German exports help Lufthansa's logistics business

Lufthansa logistics and cargo segment benefited from the global economic recovery and the recovery of German exports. Lufthansa's logistics business segment reported an increase in revenue of 43% to €2.795 billion in 2010.

German exports surged in March 2011 to the highest monthly value ever recorded.[2] Exports jumped 7.3 percent from February 2011, when they gained 2.8 percent. Exports were worth €98.3 billion ($141.4 billion) in March.[2]

Germany’s economic recovery is broadening as companies boost investment and hiring to meet booming export demand from Asia.[2] The recovering German economies is boosting demand for Lufthansa's cargo services, which allow exporters to ship freight by air.

German air travel tax cuts into Lufthansa's revenues

The German government has levied a €1 billion ($1.3 billion) per year tax on the air travel industry in Germany as part of a package of budget cuts and taxes.[3] The air travel tax is expected to raise airfares by €8-16 per ticket. German airports body ADV has predicted that air traffic in Germany could drop by as much as 3% as passengers seek cheaper tickets in France, Belgium, Poland, and Germany's other neighbors.[3] Lufthansa's CEO has said that the entire tax cannot be passed onto the consumer, which has increased its costs while also reducing its revenues due to the increase in airfares.

Competition

Lufthansa competes with both European airlines that offer many flights throughout continental Europe, such as Air France ADS (AKH), as well as with international airlines outside of Europe offering flights to Germany, such as American Airlines (AMR) and Delta Air Lines Inc. (DAL).

References

  1. Lufthansa Annual Report 2010
  2. 2.0 2.1 2.2 Bloomberg: "German Exports Surged to Record $141.4 Billion in March, Boosting Growth" May 9, 2011
  3. 3.0 3.1 Reuters: "German air travel tax overshadows IATA meeting" June 8, 2010
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