Lufthansa posts record profits as ticket prices soar

Lufthansa has forecast continuing post-pandemic travel demand and high ticket prices for the remainder of the year as it reported record profits. The German flag carrier said on Wednesday it expected its yield — the average amount of revenue received per passenger by mile — to climb further in 2023, even when compared with “the record level of the previous year”. The group’s adjusted earnings before interest and taxes reached E1.1b in Q2 of the year, a 177% increase compared with the same period last year and a record for the company. Lufthansa, which includes the Eurowings and Swiss carriers, transported more than 55m passengers between January and June, an increase of about a third from 2022, but still short of 2019 levels because of widespread staff shortages in the sector. Lufthansa’s CE Carsten Spohr on Wednesday said the company had been hiring an average of 1,000 new employees per month in 2023, as it expected results this year to be “one of the three best in the history of the Lufthansa Group”. However, the company said capacity offered by its airlines would be at the lower end of its previous forecast range because of the “persisting bottlenecks in the European air traffic system”. Strong demand coupled with the supply constraints have allowed airlines to charge higher prices, with the rising average cost of flight tickets outpacing inflation. The profit rebound represents a sharp reversal of fortunes for the industry. Three years ago, at the onset of the pandemic, Spohr had warned the company would emerge significantly smaller. It was then burning through €1mn an hour, as passenger numbers slid to just 1% of their usual capacity in the wake of lockdowns and travel restrictions. The crisis spurred the German government to offer Lufthansa a €9bn bailout package, amid wider concern for the future of the airline industry. Lufthansa has since repaid the money, and Berlin has sold the 20% stake it took in the company.<br/>