Austrian Airlines reported a pre-tax loss of €9.4m for the third quarter and a net loss of €65.1m for the first nine months of this year.
The results were announced as the airline said it was extending by two months the deadline date for bidders to buy the government's 42% stake in the carrier.
Alfred Oetsch, Austrian's ceo, reporting the results, said the "difficult business environment encountered in the first half-year 2008 once again deteriorated."
The high level of economic uncertainty as well as the financial and banking crisis are intensifying the incipient economic downturn.
Along with the price of fuel and the fall in demand, these factors had stopped the airline matching its performance in 2007.
Mr Oetsch said pre-tax earnings for the third quarter showed a loss of €9.1m compared with a surplus for the same period in 2007 of €42.7m.
The net result for the first three quarters of 2008 was a loss of €65.1m.
He said he expected the fourth quarter to show "an abrupt slump in demand, negative effects from fuel hedging and an increase in value of the US dollar."
He said a net loss of between €100m and €125m could be expected for 2008.
Mr Oetsch also confirmed the deadline for the privatisation of the airline including the sale of the 42% stake, officially held by ÖIAG, a state holding company, had been extended.
The original deadline was yesterday (October 27) but only two bidders, Lufthansa and S7 Airlines emerged with Air France KLM reportedly pulling out.
It has now been extended fro two months with Mr Oetsch "confident" the privatisation will go through.
Reuters reported that Lufthansa had bid only a "nominal" amount for ÖIAG's stake and also demanded that it also assume half of Austrian's debt of $1.1bn.
ÖIAG said in a statement: "The bids contain the demand for a subsidy to strengthen AUA's financial basis, which ÖIAG cannot fulfil for lack of a legal basis.
"ÖIAG's supervisory board therefore asks the Austrian government to extend the privatization mandate to create the necessary legal framework."
Peter Michaelis, ÖIAG's ceo, said he wanted to close the deal as quickly as possible.
Austrian also announced today that it was ending it services to Mumbai.
The airline said: "As a result of drastic overcapacity between European airports and the city in southwestern India, the weakening Indian economy and the consequences of the crisis in European financial markets, it is no longer possible to operate this route profitably in the medium term."
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