Lufthansa swings to 2Q profit

Lufthansa swings to 2Q profit

Lufthansa, Europe's third-largest airline, on Wednesday said it had an operating profit of 65 million euros ($73.4 million) in the second quarter against a loss of $469 million in the first quarter but repeated its earlier forecast of a fully-year loss for 2003.

"It now looks like we have come through the worst," said Lufthansa Chief Executive Wolfgang Mayrhuber who attributed the turnaround to cost cutting and reductions in capacity.

Lufthansa booked a net loss of $38 million in the second quarter compared with a year-earlier profit of $179.6 million, widening the first half loss to $439 million from a $30.2 million deficit in the first six months of 2002.

First half group revenues slid 7.4 percent to $8.48 billion from $9.16 billion a year ago.

Lufthansa has grounded planes, slashed investment by $225 million, frozen recruitment and cut the working hours of its 52,000 employees to align costs with tumbling revenues amid a historic slump in global air travel. But the carrier warned that "the current booking figures indicate that no marked improvement can be expected in the second half" and said it does not anticipate a positive result for 2003 as a whole.

Lufthansa didn't give separate figures for wholly owned Lufthansa Cargo, but Europe's largest scheduled air cargo carrier is thought to be outperforming the passenger division.