- Passenger numbers: 3.1 million, +10.3% year-on-year;
- Cargo volume: 78,700 tonnes, +3.8%;
- Aircraft movements: 24,800, +10.5%.
Shenzhen Airport pax up 10%, cargo up 4% in Jul-2014
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Lufthansa: 2015 outlook lowered again as 3Q2014 results show ongoing unit revenue weakness
According to Lufthansa Group CEO Carsten Spohr, 3Q2014 "was no walk in the park". The group's business was affected by weak revenue conditions, external events such as Ebola and the Ukraine crisis - and more strikes by Lufthansa pilots.
In spite of this, Lufthansa remains on course to meet its 2014 operating profit target of EUR1 billion (although this was lowered at the half year point and is lower than the 2013 result on a like for like basis). However, Lufthansa has abandoned its 2015 operating profit target of EUR2 billion (which was cut from EUR2.65 billion in mid 2014), citing a "darkening economic outlook".
Mr Spohr's agenda continues to be very full. He must seek further cost reduction in the network airline business, while continuing to position as a premium product; repair relations with Lufthansa's pilots; develop and grow new lower cost point to point airline platforms; and capture growth in the more stable aviation services markets. And he must return Lufthansa to a profit growth trajectory after years on a falling trend.
Air France-KLM 3Q operating profit tumbles due to pilot strike, but underlying trend is also down
The fall in Air France-KLM's 3Q2014 operating profit more than offset improvements recorded in 1H2014. This deterioration in 3Q2014 was largely as a result of the 14 day pilot strike in Sep-2014, which hit the operating result by EUR330 million. Nevertheless, even without the strike effect, unit revenue weakness weighed on the underlying performance of the group and lowered the like for like operating result.
Air France-KLM expects passenger capacity growth in long-haul markets from Europe to slow a little from 6.3% in 3Q2014 to 5.5% in 4Q2014. It plans to keep its own passenger capacity flat, with significant cuts in point to point capacity, but these price pressures look unlikely to dissipate quickly.
The company says that its Transform 2015 programme, which mainly focused on cost and debt reduction, is on track and it is already implementing key initiatives under its new Perform 2020 plan. The ratification by pilot union membership of the recent draft agreement over the growth of Transavia would provide an important psychological boost.