Aviation Company Profile: Deutsche Lufthansa

Aviation Company Profile: Deutsche Lufthansa

  • Submitted By: Mick123
  • Date Submitted: 11/29/2008 8:50 AM
  • Category: Technology
  • Words: 365
  • Page: 2
  • Views: 584

FRANKFURT (Reuters) - Deutsche Lufthansa (LHAG.DE: Quote, Profile, Research, Stock Buzz) expects operating profit to rise again this year and next as lucrative business travelers keep flying despite stuttering financial markets and as fuel prices hover at record levels.

"The perspectives for the aviation industry are full of promise," Chief Executive Wolfgang Mayrhuber told a news conference on Wednesday.

"In spite of the current uncertainty in the financial markets, the economic conditions remain good for Lufthansa. There have been no ground-breaking changes in terms of the fundamental conditions or the need for mobility."

Shares in Lufthansa gained 3.6 percent to 15.56 euros by 1230 GMT, giving it a market value of around 6.9 billion euros ($10.60 billion) and outperforming a 1 percent gain for the German blue-chip DAX index .GDAXI.

Lufthansa sees growth at its main passenger airline of around 6 percent on intercontinental flights and 4 percent on European services in the years ahead, with increased focus on fast-growing markets such as China, India and Russia.

High-margin business travelers now account for more than half of sales on intercontinental flights.

Cheuvreux analysts wrote: "Passenger growth remains strong...we see no sign of operational weakness, and Lufthansa's market value is still below the book value of its fleet."

Mayrhuber's optimism for 2008 contrasted with a warning issued last Thursday by rival British Airways (BAY.L: Quote, Profile, Research, Stock Buzz), with its greater dependence on routes to and from North America, that airlines were entering a downward cycle due to global economic weakness, though smaller German rival Air Berlin (AB1.DE: Quote, Profile, Research, Stock Buzz) said on Wednesday it had "cause for optimism".

Lufthansa said a condition for raising the operating result in 2008 from the record 1.38 billion euros -- a 63 percent rise -- achieved last year was continuing to compensate for high fuel...

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