Lufthansa lifts nine-month operating result to 471 million euros


FRANKFURT (Lufthansa) - "Lufthansa is holding course, even in turbulent times. Despite soaring oil prices, we have utilised our market potential and grown profitably. The strategy is right. We have turned opportunities into success," said Lufthansa Chairman and CEO Wolfgang Mayrhuber at today's presentation of Group results.

In the first nine months of the year, the Lufthansa Group lifted operating profits by 220 million to 471 million euros. Profits after tax rose sharply in parallel to 416 million euros. The Executive Board has again raised its full-year forecast and is now anticipating an operating profit of significantly over 400 million euros.

Pointing to the strengths driving the Group's performance, Wolfgang Mayrhuber said: "We have further invested in products and quality, customer satisfaction is at an all-time high. Simultaneously, we have continued with our fitness drill. We are now more dynamic and more flexible." The Group has built further on its financial strength. Lufthansa commands liquid funds of more than four billion euros and is practically debt-free.

All six of the Group's business segments developed well in the nine-month-term and improved their operating result - an exemplary team effort by all the staff. "Thomas Cook has recovered. The leisure travel subsidiary will be posting profits again for the first time in four years", said Mayrhuber. Restructuring at LSG is making headway, the first signs of success are in sight. The inflight catering arm is well on the road towards profitability, although business in the US is still problematical.

The Lufthansa Chairman and CEO reaffirmed the Group's strategy of focusing and product development. The airlines in the Group stand for mobility à la carte with quality products in all segments, including bargain fares. The integration of SWISS is right on schedule, he said. Customers of both airlines are already profiting from a variety of advantages. Another strategic step is Lufthansa's acquisition of a stake in Fraport. Competition in air traffic is no longer only between airlines or airline alliances but between entire air traffic systems, encompassing airports, air traffic control and airlines. "Our stake in the Frankfurt Airport operating company will improve cooperation within the air traffic system. A strong air traffic system in Germany will stand up in competition against London, Paris or Amsterdam."

Wolfgang Mayrhuber also dwelt on the difficult situation still confronting the airline business. Cost-cutting still tops the list of priorities, he emphasised. "Our Action Plan aimed at reducing costs and raising efficiency will be implemented. We are set on improving results by 1.2 billion euros by year-end 2006 and we will realise that target." We have already saved 708 million of the 780 million euros targeted for this year. But even afterwards, the Group must continue seeking new ways of driving down costs. "We will not let up. Costs must go down, flexibility must increase." The Lufthansa Group is strongly poised for future challenges: "A good staff and reliable management stand for progress and security for our investors."

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