Shares in German national carrier Lufthansa dived today after posting first-quarter operating profits well below estimates.
The airline, also dogged by an escalating pay dispute with its pilots, said that operating profit fell to euro five million euros from euro 99 millionin the same quarter a year earlier and versus the average analyst forecast of euro 89 million.
Lufthansa stock dived six per cent to euro 19.60, just shy of year lows of euro 18.91.
Besides additional expenditure due to rising fuel costs, the decline in earnings was mainly due to up-front payments for the Group's e-business initiatives, Lufthansa said.
Germany's pilot's union halted a fourth round of talks at the beginning of the month, after rejecting Lufthansa's offer to raise salaries for cockpit crew by between 10 per cent and 16.7 per cent this year, including profit sharing.
The union is demanding average pay rises of more than 30 per cent, and profit sharing, and is holding a ballot on whether to call an all-out strike.