Cargolux revenues and profits take a hit in 2019

In its full-year results for 2019, Cargolux revealed that revenues decreased 14% year on year, from $2.6bn in 2018 to $2.4bn in 2019.

Cargolux said this was due to lower load factors and yields coupled with lower fuel surcharge revenues as a result of declines in the price of fuel.

Meanwhile, earning before interest and tax  decreased from $321m in 2018 to $114m last year and net profits dropped from $211m to $20m.

Freight tonne km (FTK) volumes dropped by 2.1% year on year to 8bn FTK.

However, Cargolux said that it had outperformed the market. Indeed, IATA figures show that the top ten cargo airlines experienced a 3.9% FTK decline last year. The carrier said that it would continue to pay down debt.

Last year the cargo market came under pressure as a result of a series of trade disputes.

“In 2019, Cargolux witnessed softening markets, unresolved trade conflicts, and uncertainties surrounding an agreement on the UK’s exit from the EU,” the airline said.

“This resulted in a general downtrend in the industry, specifically over-capacity in the markets. After a solid start to the year, the industry experienced weak demand for the available capacity during the summer and autumn period, prior to a short peak season in the fourth quarter.”

The decline in profits and revenues follows two years of growth, culminating in a record result in 2018.

At the end of December 2019, Cargolux had a fleet of 30 aircraft: sixteen Boeing 747-400 freighters (11 B747-400Fs and 5 B747-400ERFs) and fourteen Boeing 747-8 freighters.

Similar to other operators of 747-400 freighters, Cargolux recorded an impairment of $47.6m in respect of its B747-400 fleet in 2019.

“This fleet enables Cargolux to respond to changing market conditions in a flexible and timely manner,” the carrier said.

In 2019, Cargolux added Santiago de Chile and Jakarta as destinations, enabling it — as the only cargo carrier to offer maindeck capacity between Europe and the Indonesian capital — to explore new business opportunities and meet existing customer requirements.

Cargolux also boosted its presence in Eastern Europe. Its Hong Kong–Budapest route was increased from three to four flights per week, and two new weekly services were added from Zhengzhou to Budapest. In addition, Cargolux also offers six weekly rotations through Hungary.

A new service from Zhengzhou to Los Angeles via Xiamen also expanded the airline’s network.