Aviation sector raises hope after notices of high profit

Aviation sector raises hope after notices of high profit

ISTANBUL - Hürriyet Daily News
Aviation sector raises hope after notices of high profit

Lufthansa planes stand on the tarmac at Munich’s international airport ÜThe airline says its net profit increased by 30 percent in the third quarter. REUTERS photo

Three large international airlines posted higher-than-expected profits yesterday, signaling a revival in a sector vastly affected by the Europe-centered economic crisis. The data reflects a fruitful summer compared to last year and comes at a time when other airlines, including national flag carrier Turkish Airlines, raised further hopes in civil aviation by announcing aircraft orders.

Lufthansa shares took off on the stock exchange yesterday after the German airline reported a sharp rise in earnings in the third quarter and promised to intensify cost-cutting measures.

Lufthansa shares were the biggest gainers on Frankfurt’s blue-chip DAX 30 index, soaring 5.55 percent while the overall market was only modestly higher by 0.59 percent.

Investors were clearly pleased by Lufthansa’s announcement that its bottom-line net profit had increased by 30 percent to 642 million euros in the period from July to September, Agence France-Presse reported.

Higher traffic

Air France-KLM also said in a statement yesterday that it had exceeded third-quarter expectations with a net profit of 308 million euros, owing to higher passenger traffic and favorable exchange rates. The Franco-Dutch group said operating profit was 506 million euros for the third quarter and turnover was up 6 percent to 7.2 billion euros. Net profit rose to 306 million euros and the net debt was reduced.

Japan’s All Nippon Airways (ANA) yesterday said half-year net profits had soared 61.6 percent on firm travel demand, although it admitted Tokyo’s territorial dispute with Beijing had hurt its China business. The carrier’s net profits came to 36.93 billion yen ($465 million) in the six months prior to September as revenue grew 6.9 percent year-on-year to 753.21 billion yen.

Business demand was solid while leisure travel recovered from a slump after the March 2011 disaster, ANA said, when an earthquake and tsunami sparked the world’s worst nuclear accident in a generation.

A day earlier, Russian state-owned leasing firm Aviation Capital Services signed a commitment to buy 35 Boeing 737 MAX passenger jets with a market value of more than $3 billion. Singapore Airlines (SIA) also decided to order five more Airbus A380 superjumbos and 20 A350s in a deal worth $7.5 billion, the leading Asian carrier said last week.

Turkish Airlines ordered 15 jet airliners from Boeing on Oct. 22 in a deal worth $4.7 billion at list prices. Earlier in October, the airline ordered 15 Airbus A330-300 long-range jets in a deal with Airbus estimated at $3.5 billion.