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Pandemic-stricken Lufthansa posts 1.26 billion euro third-quarter operating loss

FILE PHOTO: A Lufthansa airplane is seen partially wrapped at the runway of Berlin Brandenburg Airport (BER), also called "Willy Brandt", ahead of its opening in Schoenefeld near Berlin, Germany, October 19, 2020. REUTERS/Annegret Hilse

FRANKFURT (Reuters) - Deutsche Lufthansa LHAG.DE reported a third-quarter operating loss of 1.26 billion euros ($1.49 billion) and warned of weak demand during the remainder of the year.

The German carrier said on Tuesday that the loss, which compares with a quarterly profit of 1.3 billion a year earlier, narrowed from the second quarter because it was able to resume some flights and slash costs.

“Demand for air travel is expected to remain low in the coming winter months due to the global evolution of the pandemic and the associated travel restrictions,” it said, adding it would “withstand further burdens from the corona pandemic”.

As a result, Lufthansa group’s airlines, based in Germany, Switzerland, Austria and Belgium, will likely only offer up to 25% of the last year’s capacity in the fourth quarter.

Adjusted free cash flow during the three months through September fell to a negative 2.07 billion euros from a positive 416 million last year, driven by the reimbursement of 2 billion euros for pandemic-related flight cancellations.

The airlines group said it still has cash reserves of 10.1 billion euros, including 6.3 billion in undrawn state funds from a bailout granted earlier this year by a number of European governments.

Reporting by Ludwig Burger; Editing by Edward Taylor and Alexandra Hudson

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