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Air Berlin in profit slump

November 12, 2014

German carrier Air Berlin has announced another cost-cutting program to become more competitive. The airline saw its profit decline sharply in the third quarter amid large-scale restructuring.

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Airberlin-Etihad plane
Image: airberlin

Profits for Germany's second-largest carrier took a dive in the third quarter, the company reported.

The airline's pre-tax operating earnings dipped to 75 million euros ($93 million) between July and September, down from 115.6 million euros in the same period last year.

Adjusted for one-off restructuring costs, Air Berlin booked an operating profit of 90 million euros, leaving it with bottom-line earnings of 50 million euros as compared with the 101 million euros in the same quarter in 2013.

Management reshuffle

The airline is still struggling with the aftermath of an earlier and hasty expansion program and has been kept alive lately with capital injections from the state-owned Arab carrier Etihad, which in turn has secured access to the European market.

Air Berlin said it would implement a second big savings program with a view to cutting costs by 400 million euros by 2016.

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That program will largely be overseen by former Lufthansa manager Stefan Pichler, who is replacing the airline's current CEO, Wolfgang Prock-Schauer on February 1, 2015.

hg/pad (Reuters, dpa)