FRANKFURT/BERLIN, Aug. 4 (Reuters) – Germany’s Lufthansa (LHAG.DE) said on Thursday it expected demand for short-haul flights in Europe to fuel growth at its passenger airlines this year, and predicted a return to the group’s operating profits. for the full year, pushing its shares higher.
Travelers are back in the air following travel restrictions related to the COVID-19 pandemic in 2020 and 2021, allowing airlines such as Lufthansa, Air France-KLM (AIRF.PA) and British Airways owner IAG to return to profits this summer.
Lufthansa said bookings for August to December now averaged 83% of pre-pandemic levels and hoped business travel bookings would reach 70% in the fourth quarter.
Planes of German airline Lufthansa stand parked at Frankfurt Airport in Frankfurt, Germany, June 2, 2020. This may interest you : How to Survive the Travel Armageddon of Summer 2022 – Black Girl Geeks. REUTERS/Kai Pfaffenbach//File Photo
The airline industry, especially in Europe, is struggling to cope with the rapid uptick in demand, with huge queues at many airports due to staff shortages, leading to last minute cancellations and frustration for travelers.
The travel chaos has resulted in airlines cutting capacity, with Lufthansa canceling more than 2,000 flights this summer. It said it was expected to offer about 80% of its pre-crisis capacity in the third quarter, less than previously planned, and 85-90% by 2023.
However, that should help it significantly improve quarterly adjusted earnings before interest and taxes (EBIT) compared to the second quarter, it said.
Lufthansa reported an adjusted EBIT of Euro 393 million for the three months to June on the back of strong demand for air cargo flights, compared to a loss of Euro 827 million a year earlier.
The passenger airline reported an adjusted loss before interest and taxes of 86 million euros in the quarter due to costs related to flight disruptions.
However, Lufthansa still faces uncertainty from possible strikes by its employees. Management was in talks with ground staff on Thursday, whose one-day strike last week forced the airline to cancel more than 1,000 flights.
A day of strike costs Lufthansa 30 to 35 million euros in lost revenue.
The airline will also talk to pilots who have already voted in favor of industrial action.
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