Strong cargo performance boosts Lufthansa’s Q2 bottom line

Lufthansa Group today reported 820 million euros ($936.5 million) in revenue for the second quarter for its Logistics segment, which includes Lufthansa Cargo, up 2.6% year over year. Lufthansa Cargo “continuously withstands macroeconomic turbulences,” Chief Executive Carsten Spohr said on today’s earnings call. “As a matter of fact, it actually benefits from macroeconomic and geopolitical tensions.” [caption id="attachment_57290352" align="aligncenter" width="1782"] (Courtesy/Lufthansa Cargo)[/caption] Yields at Lufthansa Cargo were up 3.5% YoY in Q2, Lufthansa’s earnings report said. The group also reported in Q2: 4.6 billion available cargo tonne kilometers (CTK), up 4.7% YoY; 2.7 billion revenue CTKs, up 5.1% YoY; and A cargo load factor of 57.6%, up 0.2 percentage points YoY. “The high demand from Asian e-commerce players and semiconductor producers , as well as capacity constraints in sea freight led to that underlying increase in demand for Lufthansa Cargo ,” Spohr said. “And it’s obvious that some of the cargo, which was supposed to go from Asia to the U.S., is now — due to the tariffs — redirected toward Europe.” This shift played to Lufthansa Cargo’s advantage, as the cargo carrier is not very active between China and the United States, but is active between China and Europe, Spohr said. Q2 results The carrier group reported $11.8 billion in overall Q2 operating revenue, up 3.1% YoY, and $1.2 billion in net profit, up 115.8% YoY. Lufthansa Group also reported in Q2: Operating income of $12.8 billion, up 5.2% YoY; Adjusted EBITDA of $1.7 billion, up 16.5% YoY; and Earnings per share of 96 cents, up 115.4% YoY. Lufthansa Cargo operates twelve 777Fs and four A321P2Fs, and uses belly capacity on Lufthansa’s passenger aircraft. Also, AeroLogic , a joint venture between Lufthansa and DHL Express, operates twenty-six 777Fs. AeroLogic added its twenty-fifth 777F (68144) in March, flying it on a CMI basis for DHL Express. The JV then added its twenty-sixth 777F (68147) in June. Lufthansa has ordered seven 777-8Fs, which it expects to receive from Boeing by 2030, according to Lufthansa’s 2024 earnings report released March 6. Increased connectivity Lufthansa Cargo launched two weekly narrowbody-freighter flights to Katowice , Poland (KTW), in April. The carrier flies an A321P2F between Frankfurt (FRA) and KTW on Thursdays and Saturdays. Lufthansa Cargo also added an additional weekly flight each to Buenos Aires (EZE) and Curitiba, Brazil (CWB), in April on a 777F. The carrier flies to South America four times per week: twice to EZE and twice to Curitiba CWB. The flights include stops in Viracopos, Brazil (VCP), and Montevideo, Uruguay (MVD). Lufthansa Cargo partnered with IndiGo CarGo this month to allows shippers to book cargo transport with IndiGo from Dhaka, Bangladesh (DAC), to Los Angeles (LAX), using both carriers’ networks. Lufthansa will resume flights to Tel Aviv (TLV) on Aug. 1, after halting them in mid-June due to closed airspaces and escalating conflict between Israel and Iran. The situation in the Middle East has hurt Lufthansa’s passenger operations, but geopolitical tension can boost air cargo operations, Spohr said. “The more geopolitical tensions exist, the more unpredictable the world is, the less predictable our supply chains,” he said. “That usually plays to our favor.” Spohr said he is “optimistic for cargo for the rest of the year.” Shares of Lufthansa Group ( OTCMKTS: DLAKY ) were up 0.83 % from market open to $ 8.53 as of market close today. Lufthansa Group has a market capitalization of $10.5 billion. Editor’s note: All amounts have been converted to U.S. dollars. Cargo Facts Symposium, the quintessential event for stakeholders and key leaders in the global freighter and air cargo industries, will take place Oct. 22-24 at the Grand Hyatt in Nashville . Learn more and register today to take advantage of the early-bird rate before Sept. 5.

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