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Last Updated: Thursday, 19 January 2006, 10:39 GMT
Lufthansa raises profit forecast
Lufthansa airplane
Lufthansa has returned to profit after huge losses in 2003
German airline Lufthansa has said it expects its profit for 2005 to rise by 44%, helped by record passenger traffic of 51.3 million passengers last year.

It hopes to post an operating profit of about 550m euros ($660m; 378m), up from 383m euros in 2004.

The forecast improves on its last trading update which predicted a profit above 400m euros.

Chief executive Wolfgang Mayrhuber has said he wants to see cost savings of 1.2bn euros by the end of 2006.

"I still see room for an additional increase in earnings in 2006, especially from additional potential from cost savings," said WestLB analyst Frank Skodzik.

"Lufthansa is one of the very few flag carriers that still has huge cost saving potential."

Mr Mayrhuber has set Lufthansa a target to eventually double annual operating profit to 1.0bn euros.

Last week, Lufthansa's bigger European rival Air France KLM said it expected the financial year to 31 March would be a good one for earnings.

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