(Frankfurt) Europe’s largest airline group Lufthansa on Friday revised downwards its 2024 profit forecast and announced a “recovery” plan for its passenger transport business due to a risk of losses at the end of the financial year.
The group as a whole now expects an annual adjusted operating profit of between 1.4 and 1.8 billion euros, against around 2.2 billion previously, following a disappointing first half.
Furthermore, in the passenger transport business alone, the group’s core business, “it is becoming increasingly difficult for Lufthansa Airlines to achieve break-even for the full year,” the group explained in a statement.
“Lufthansa Airlines is particularly affected by the challenges posed by the negative market developments and by inefficiencies in Lufthansa and Cityline flight operations, also due to aircraft delivery delays,” the statement added.
To address this, a “vast recovery program is being launched,” the group said, without giving further details.
In the second quarter, the Lufthansa Group achieved an operating result of 686 million euros, compared to 1.1 billion euros in the comparable quarter of the previous year.
This decline of almost 40% is explained by the “decline in average turnover” per passenger in all regions, “particularly in Asia”, according to the company.
The flagship passenger transport business – alongside Lufthansa, Austrian, Swiss, Eurowing and Brussels Airlines – achieved an operating profit of 213 million euros in the second quarter, around 300 million euros less than in the same period in 2023.
This result did not compensate for the loss in the first quarter of 2024, suffered due to strikes called by employees within the group and by air traffic controllers at airports.
Overall, in the first six months of the year, the passenger sector reported an operating loss of 427 million euros, which contrasts with the profit of 149 million euros achieved in the first half of 2023, when the aviation sector had recovered after the period of the health crisis.
Lufthansa’s share price was down 1.59 percent at around 9:40 a.m. (Eastern time) on the Frankfurt Stock Exchange.
These announcements come as the Air France-KLM group anticipated a difficult summer at the beginning of July due to an “avoidance” of Paris by international customers during the Olympic Games.
The Franco-Dutch group also suffered a heavy loss in the first quarter caused by rising costs and geopolitical tensions, despite more passengers paying more for their tickets. It has therefore launched a savings plan.