Lufthansa Group has said it will reduce its planned capacity growth in 2019 after reporting a 7.7 per cent decrease in earnings before interest and taxes (EBIT).
The group saw an adjusted EBIT of €2.4 billion in the first nine months of 2018 and has attributed the fall to higher fuel costs, extra expenses incurred from delays and cancellations, and ‘integration costs’ at Eurowings.
Total earnings increased 6 per cent to €26.9 billion across the group, while traffic revenues were up 7 per cent.
Although Lufthansa Group hasn’t adjusted its full-year earnings projection, it does warn that it will reduce its capacity growth to “a more modest 8 per cent” for the 2018/19 winter season and to just 3.8 per cent for the summer 2019 schedule.
Carsten Spohr, chairman of the executive board and CEO of Lufthansa, said the results are the “second-best nine-month result” in the group’s history.
However, he said: “And had it not been for the losses at Eurowings, we would have posted another record earnings result. This is a clear testament to our sustainable financial strength – a strength that we have demonstrated even under challenging conditions this year.”
Spohr also issued a word of warning, adding: “Future growth in the air transport sector will need to pay far more regard to the capacities of the infrastructure in the air and on the ground. At the same time, we aim to secure the profitability of our airlines through capacity discipline. We also expect the substantial rises in fuel costs to lead to higher ticket prices from 2019 at the latest.”
lufthansagroup.com