Lufthansa cuts losses, but reports ‘slump’ in fares

Lufthansa reported an operating loss of €330 million (£282 million) for the first three months of 2010, almost half its losses of a year earlier, suggesting a recovery in air traffic is underway.

However, Europe’s biggest airline group said a “slump in prices” continued to make life difficult, with average fares not covering the increasing price of oil. This was despite a 14.8% increase in revenue year on year.

A €330 million rise in quarterly fuel costs exactly matched the operating losses.

A quarterly loss of €45 million at BMI, which Lufthansa took over last year, added to losses in Germany and at subsidiary carriers Austrian Airlines and Germanwings, in what is traditionally a loss-making three months for European carriers.

Swiss was the only part of Lufthansa’s passenger airline group to report a quarterly operating profit – of €1 million. However, the group’s cargo business also reported a profit and Lufthansa forecast an overall return to profit this year.

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