Cargolux posts 6.5% profit rise in 2006

Cargolux posts 6.5% profit rise in 2006 Luxembourg-based all-cargo airline Cargolux posted net income of $82.6 million in 2006, a 6.5 percent increase compared to $77.6 million in 2005. The result includes a capital gain derived from the sale of four aircraft.
   Cargolux results are now expressed according to International Financial Reporting Standards (IFRS) accounting rules.
   Operating profit before financing costs decreased 11.5 percent to $109.4 million as operating expenses rose 8.8 percent to $1.4 billion. Cargolux’s fuel costs rose 22 percent over 2005 to $581.5 million, accounting for 40 percent of the airline’s total costs. The airline said that its fuel surcharges did not fully compensate for the incremental fuel cost incurred in 2006.
   Consolidated net revenue for 2006 improved 5.5 percent to $1.5 billion.
   The airline said it considered 2006 a “bridging year.” During the 12 months it implemented a restructured network to take into account the rising fuel prices as well adding no new aircraft added and cutting back on leased-in capacity.
   These factors contributed to a decline in available ton-kilometers (ATKs) of around 3.2 percent, in freight ton-kilometers flown (FTKs) of 0.4 percent to 5.27 billion and a reduction in block hours by 3.8 percent to 84,824 hours. However, tonnage increased 1 percent to 650,947 tons, mainly due to higher load factors, which grew 2.1 percentage points to 72.4 percent.
   “In the year 2006, Cargolux performed as foreseen in its business plan and improved its financial health. This is no minor feat in the context of an air freight market that has grown below standard at only 4.6 percent in 2006, which is less than the medium and long term forecast,” said Pierre Gramegna, Cargolux’s chairman.