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Swissair profit off 56%
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August 25, 1999: 3:49 a.m. ET
Europe's number five carrier follows industry decline in first half
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LONDON (CNNfn) - Swissair posted a sharp drop in first-half profits Wednesday, but its parent SAirGroup proved more resilient than its European rivals after expanding into aviation-related services.
Swissair operating profit fell 56 percent to 84 million Swiss francs ($55.1 million) from 189 million a year earlier. The decline was less severe than recent results posted by other European carriers such as British Airways, Lufthansa and KLM.
SAirGroup is the most diversified of the European flag carriers and relies on flying passengers and cargo for less than half of its annual revenues. The group has expanded resolutely into providing maintenance, technology and logistic services such as catering for other airlines and transport providers.
The expansion included the acquisition of U.S.-based Dobbs airline catering group.
The airline result cut the group's net profit by 31.5 percent to 87 million francs, but most other divisions moved ahead despite the intense competition in the airline industry.
The result was at the lower end of expectations and SAir Group shares dipped 1.7 percent to 313 Swiss francs in early trading in Zurich.
Group chief executive Philippe Bruggisser said the company would not meet the full-year net profit of 361 million francs achieved in 1998.
Group revenues climbed 6.8 percent to 6.58 billion francs from 6.18 billion a year earlier. Airline revenues climbed 4 percent to 2.94 billion francs. Passenger numbers rose 5 percent to 7.78 billion.
European airlines have suffered badly from overcapacity on transatlantic routes and the rise of low-cost airlines in the European market. Increasing fuel prices have also cut profitability. 
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Swissair
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