Lufthansa at 26-month low on profit warning

Montag, 17. Juni 2019 09:22

Deutsche Lufthansa AG plunged at the beginning of the Monday session in Frankfurt following a cut to its outlook for this year. Germany's flagship airline cited overcapacity in the sector in Europe parallel to the increase in competition from low-cost carriers against its own subsidiary Eurowings. It said the firm is due for restructuring and that the "ongoing strong performance in long haul" makes up only partly for the "price deterioration." It is particularly strong in Germany and Austria, the home markets, according to the report.

Lufthansa also estimated fuel expenses may grow by €550 million this year. On top of that, the company determined a €340 million provision for the first six months of the year on behalf of a tax-related issue from early in the century. The 2019 target for the margin in the terms of earnings before interest and taxes (EBIT) landed at 5.5% to 6.5% from the previous range of 6.5% to 8%. The group's adjusted EBIT forecast was slashed to between €2 billion and €2.4 billion. Previously it was set at €2.4 billion to €3 billion.

Shares nosedived 10.66% at 9:07 am CET to €15.805, their lowest level since April 19, 2017. They lost 19.77% so far this year compared to a rise of 14.51% in the benchmark DAX stock index in the same period.

Enlaces afines: Deutsche Lufthansa AGDeutsche Lufthansa AG
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Breaking the News / IT