Lufthansa misses quarterly profit estimates as fuel costs weigh
German airline expects to expand capacity by 8% in winter and raise prices next year
The German flagship carrier expects €900 million in extra expenses for fuel next year
Germany’s biggest carrier Lufthansa said it would raise its number of flights more modestly than peers this season after missing profit estimates for the third quarter this year.
The company on Tuesday reported adjusted earnings before interest and taxes (ebit) of €1.35 billion, against expectations of €1.41 billion in the July-September period.
“We expect to see our full-year costs increase by more than €1 billion in 2018 due to fuel costs and the extra expenses incurred from delays and cancellations alone,” chief executive Carsten Spohr said in a statement.
Lufthansa said it expects to expand capacity by 8 per cent in winter versus an anticipated 10 per cent at peers and to grow capacity by 3.8 percent for the 2019 summer timetable.
Altogether, Lufthansa expects to hike 2019 capacity by significantly less than the 8 per cent seen this year, when it benefited from the insolvency of German carrier Airberlin.
“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,” Mr Spohr said.
The German flagship carrier expects €900 million in extra expenses for fuel next year, after seeing a spike by €850 this year.
On that back of that, ticket prices would rise next year, Lufthansa said, after having said in summer that it would raise ticket prices for the rest of 2018.
The company maintained its guidance for adjusted earnings before interest and tax to fall slightly from 2017’s record level of €2.97 billion.