Deutsche Lufthansa AG forecast rising profit through year-end with demand for air travel remaining high despite an inflationary squeeze on consumer spending power.
Europe’s biggest airline group expects third quarter earnings above the pre-pandemic level of €1.3 billion ($1.42 billion), propelling full-year earnings to above €2.6 billion, in line with current analyst expectations.
Strong demand this summer helped the airline to almost triple adjusted earnings before interest and taxes to €1.1 billion in the second quarter, it said in a statement Thursday, in line with analysts’ estimates. Revenue was up 17% from a year earlier.
Lufthansa expects demand for flying to remain high for the remainder of the year with bookings for the late summer and early winter seasons at 90% of pre-pandemic levels.
The company plans to offer 88% of its pre-crisis capacity in the final quarter, helped by a continued recovery in leisure travel demand. Business travel, while improving, is expected to remain substantially below 2019 levels through the end of the year, Lufthansa said.
Lufthansa aims to get as close to an 8% earnings margin it’s targeting for 2024 by the end of this year, Chief Financial Officer Remco Steenbergen said in the statement. That would help the company pay down debt incurred during the coronavirus pandemic.
