Deutsche Lufthansa AG's second-quarter profit rebounded sharply
even as the airline tries to navigate difficulties in its labor
relations and a dispute with the families of survivors from the
crash of Germanwings jetliner over compensation.
The German carrier Thursday reported a profit of €529 million
($580 million) compared with €173 million in the year prior, which
was hit by several one-time effects. Sales rose 9% to €8.4
billion.
For the first half, Lufthansa swung to a €954 million profit
from a €79 million loss in the year-prior. The result was bolstered
by the first-quarter disposal of its stake in Jetblue Airways Corp.
Second-quarter profit rose to €529 million.
"Our first-half results are solid," Lufthansa Chief Financial
Officer Simone Menne said, acknowledging that the improvement was
largely due to one-off effects.
Lufthansa has been seeking to revamp its operations and labor
agreements to counter discount carriers hurting its short-haul
network and strong competition from Middle East airlines that are
stealing its long-haul business. Talks with labor unions have been
acrimonious and led to strikes, though the carrier's pilots union
last week extended an offer for mediation.
Ms. Menne said the airline welcomed the engagement by the
pilot's union for further talks, but was still assessing the
offer.
Lufthansa also is in a dispute with relatives from the
Germanwings plane crash in March over compensation. The relatives
charge the airline's compensation offer is inadequate for the loss
of life that investigators believe was caused by co-pilot
suicide.
Lufthansa confirmed its full-year outlook for at least €1.5
billion in adjusted earnings before interest and taxes, before
strike-related costs. Strike costs this year are around €100
million, Ms. Menne said
The absence of some of the one-off effects that aided the first
half will largely be absent in the second part of the year, making
the period "more demanding," Ms. Menne said. Fuel costs should
continue to be lower, she said, though pressure on prices will
persist.
The first-half performance benefited from €309 million in lower
fuel costs. The strengthening dollar aided sales, though overall it
represented a €158 million headwind because Lufthansa has more
costs in the U.S. currency than revenue.
Write to Robert Wall at robert.wall@wsj.com
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