Asia Pacific weakness hits Lufthansa Cargo profit

The Lufthansa Group’s Logistics segment, whose main component is Lufthansa Cargo, has posted a significant decline in its operating profit due largely to falling demand on routes between Europe and Asia.

Asia Pacific weakness hits Lufthansa Cargo profit

Adjusted EBIT (operating profit) for the first six months of the year was reduced to €15 million compared to €127 million in the same period in 2018, according to a first half-year trading statement. 

Adjusted EBIT for the second quarter (April to June 2019) was in negative territory at €9 million compared to a positive €55 million, a year ago.

Traffic revenue was down by 5 percent “due to pricing and volumes especially on routes between Europe and Asia.”

First half-year Revenue tonne cargo kilometres were down 1 percent in contrast to capacity, measured in available cargo tonne kilometres, which increased by 9 percent.

This resulted in a cargo load factor of 61.1 percent, down 6.1 percentage points on the first half of 2018.

Focusing on the outlook, the statement noted that the Logistics segment, with Lufthansa Cargo, should post a full-year margin of between 3 percent and 5 percent compared to 7 percent to 9 percent previously.

“This is contingent, however, on demand stabilizing in the fourth-quarter period, in which – for seasonal reasons –this business segment tends to generate a substantial part of its earnings.”

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