The airline Swiss was also able to increase both sales and profits in the third quarter. It is the highest operating profit in the company’s history in the period from January to September. Higher ticket prices and lower costs are responsible for the success.
The Lufthansa subsidiary made an operating profit of 277.6 million francs from July to September – traditionally the most travel-intensive months of the year. Last year, an operating profit of 220.5 million francs was achieved in the same period. This year, profits were around a quarter higher, while sales rose by almost 11 percent to 1.5 billion francs.
Legend: Busy operations at Zurich Airport. Swiss benefits from the desire to travel. KEYSTONE/Ennio Leanza
According to a communiqué, Swiss’ sales from the beginning of the year were 4.0 billion francs. Sales in the nine-month period are now about the same as in the year before the pandemic. The operating profit since the beginning of the year climbed even faster and reached 615.9 million francs. In 2022, Swiss only achieved a surplus of 287.5 million francs, which was less than half as high; before the pandemic, the nine-month profit was 490 million.
“We benefited from our competitive cost structures as a result of the restructuring in connection with the corona pandemic,” said CFO Markus Binkert in the Swiss press release. In other words, Swiss ensured that some of the costs that it had to save due to the collapse in air traffic during the pandemic phase were not even incurred again.
The parent company is also high
However, increased ticket prices also played into Swiss’s hands. A look at the figures from the German parent company Lufthansa shows that it is not only Swiss that benefits from higher ticket prices. The average revenue per ticket at Lufthansa in the third quarter was 25 percent higher than in the summer of 2019 – and therefore higher than ever before. Lufthansa wrote that demand from private travelers remains high, especially for premium ticket classes.
Accordingly, not only Swiss achieved a record result, but also the Lufthansa Group. In the months July to September it achieved sales of almost 10.3 billion euros. Compared to the previous year, this corresponds to an increase of around 8 percent. The operating profit rose by almost a third and reached almost 1.5 billion euros. Only around the bankruptcy of Air Berlin in late summer 2017 did the group earn more in day-to-day business than in the last few months.
“The time of bargain prices is over”
Not much is expected to change in terms of the bubbling income and profits for the time being. Lufthansa boss Carsten Spohr sees his group still on track to achieve an operating profit of at least 2.6 billion euros this year as planned. The Swiss subsidiary is also optimistic about the rest of the year. Here it is said that “a very good result” is expected.
The higher ticket prices compared to previous years are unlikely to change for the time being – at least as long as the still limited flight supply cannot keep up with demand. In any case, Swiss finance chief Markus Binkert expects prices overall to remain higher than before the pandemic, as he explained in a conference call with journalists. “The time for bargain prices is over,” and flying will remain more expensive in the medium term than it was before the crisis.