Travel companies release third-quarter profit results
A mixed bag is being reported at some of the travel industry’s biggest companies as they release their third-quarter results.
Profit at Lufthansa’s passenger division grew more slowly during the quarter as cost cuts only partly offset the combined impact of currency effects and tough competition in Asia.
Profit at the division grew by 3.5% to €561 million in the three months to the end of September. That compares with 15.4% growth in the same period a year earlier.
Lufthansa had already reported a 27% fall in group operating profit for the first nine months to €660 million. LH and European airlines such as Finnair and Ryanair recently cut their profit forecasts, mainly due to lower demand.
Air France-KLM posted a 29.1% rise in third-quarter operating profit to €634 million, thanks to its restructuring efforts, but warned of continued weakness in its medium-haul business. It also delayed the timetable for getting over its mountain of debt as long as it was helping its troubled partner Alitalia.
CEO Alexandre de Juniac described the operating result as “very encouraging”. It was in line with analysts’ expectations and up from €491 million in the same quarter last year. Net profit fell from €296 million to €144 million.
Total revenues for the third quarter at hotel giant Marriott grew 15.8% year-on-year to $3.16 billion, beating analysts’ estimates. Higher pricing, a 75% rise in occupancy worldwide and a 5% increase in revenue per available room led to the result.
Solid group bookings in North America and a rise in fees also benefited the company. The company also divested eight properties.
Marriott has 3,900 lodging properties worldwide and 670,507 timeshare resorts. Nearly 850 properties with over 144,000 rooms are under development, under construction or undergoing conversion to the company’s brands.
The recently merged global car rental company Avis Budget Group is doing well from volume growth and strong pricing trends in North America and strong performance in Europe, Middle East and Asia. But higher fleet costs are a drag on results. Its net revenue increased by 10.4% to $2.4 billion year-on-year, driven by the acquisition of Zipcar and a 6% rise in rental days.
Reuters / AFP / Zacks
[pictured: Lufthansa Business Class; © Photographer: Jens Goerlich]