Problems such as rising fuel costs and overcapacity in Europe are weighing heavily on the group’s results.
Lufthansa has posted an operating loss of €336 million for the first three months of the year as it is hit by rising fuel costs and overcapacity in Europe, the news agency Reuters reports.
The airline group reveals that fuel costs increased by €202 million during the quarter, as the news pushed its share price down by more than 5%.
Meanwhile, unit revenues at the group’s airlines, which include Austrian Airlines, SWISS and expanding budget carrier Eurowings, dropped significantly.
However, the comparison is with last year’s positive first quarter when the group posted an operating profit of €52 million, which was boosted by lower capacity in Germany due to the insolvency of Air Berlin.
The loss follows a bleak winter period for Europe’s airlines including bankruptcies, plus an admission by easyJet – which has a strong position in Germany – that it expects a loss of around €320 million for the six-month period to the end of March.
Headwinds such as overcapacity, fuel costs and uncertainty over Brexit causing people to delay booking their summer travels have all weighed heavily on European airlines.
However, Lufthansa says it expects revenues to improve in the second quarter as booking levels recover and as it continues to control capacity more tightly.