Lufthansa Cargo rides an Asian tailwind

With record profits under its belt for the first half of 2010, Lufthansa Cargo appears to have turned the corner on the crisis of last year and is cautiously reactivating its parked aircraft in order to boost capacity on robust Asian trade lanes. By Donald Urquhart.

As the recovery from the global economic crisis of 2009 continues to grow and find firmer footing, it has now become commonplace for air cargo carriers – and indeed the whole industry – to report unprecedented growth figures. The problem is these double digit growth figures have a fairy tale aura about them for the simple reason they compare today’s figures with the depths of the industry lows last year. While they do speak of a welcome recovery and growth, what is truly impressive are the industry players that turn in record results, aside from just impressive growth rates. Lufthansa Cargo is one of those fortunate enough to lay claim to that fame. Lufthansa Executive Board member and CFO Stephan Gemkow was particularly elated – a rare emotion for the corporate finance breed – when detailing the contribution of the Lufthansa Group’s cargo division during his recent half-year results briefing.

“The freight business shows that consistent cost management also pays off during market recovery phases. After implementing intensive measures to improve its result, Lufthansa Cargowent on to record the best first-half result in its history – a truly remarkableperformance!” he said.

This performance – 830,000 tonnes of freight and mail – earned the cargo division an operating profit of 144 million euros for the first half of the year – some €278 million higher than during the same period of the previous year and comes at a time when most airlines are happy to simply make any profit at all, or even just narrow their losses from last year.