POLITICS & INSTITUTIONS - ECONOMY

Pandemic drives Cargolux's record results



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Demand for PPE and other health-related materials boosted Cargolux's profits in 2020. Photo: Edouard Olszewski/archives 

After a difficult 2019 with a net profit of €20m, Cargolux ended 2020 with a record €637m profit, driven by the health crisis and the demand for medical equipment.

To understand the extent of this record profit, one must remember that in 2018, Cargolux posted the best results in its history with a profit of €211.2m. In other words, Cargolux did three times better than its best year. In 2019, Cargolux’s profit had gone into a tailspin at just €20m.

In the details of its annual results, the airline posted revenues of $3.171bn (€2.62bn) in 2020 compared to revenues of $2.26bn (€1.87bn) in 2019. The operating margin rose from 5.1% to 31.3% in one year. Net profit after tax rose from €20m to €637m. In terms of freight detail, Cargolux increased sales by 9.7% with 1,107,071 tons of freight sold.

The 2020 financial results fall like a cherry on top of the 50th anniversary cake of the airline, which moved to its new headquarters last July.

Health crisis sparks demand for air cargo

Cargolux's outstanding results are explained by the high demand for materials in connection with the pandemic.

“We experienced unprecedented demand for the transportation of personal protective equipment (PPE) as well as other products that needed to be transported by air to keep logistics lines intact. Cargolux played a key role in delivering critical supplies throughout the covid-19 crisis, filling the void left by grounded passenger aircraft and keeping supply chains moving. Cargolux continually navigated the changing restrictions around the world to meet market demand,” the airline says.

Cargolux's routes, especially to China--where Cargolux recently opened a new link to Shenzhen Airport, China's fourth busiest cargo airport and the 24th busiest airport in the world--have allowed the company to take advantage of the strong global demand for medical and health equipment to gain market share in the air cargo market. In one year, Cargolux has risen from seventh place in IATA's ranking of the top 25 international scheduled cargo carriers in the world to fourth place.

In 2019 Cargolux expected a challenging period due to significant turbulence in the global market, especially marked by overcapacity issues, a market slowdown, international trade disputes and uncertainties related to the UK’s exit from the European Union.

At the end of December 2020, Cargolux’s fleet consisted of 30 aircraft, of which 16 were Boeing 747-400 freighters (10 Boeing B747-400F and 6 Boeing B747-400ERF) and 14 Boeing 747-8 freighters.

Christianne Wickler replaces Paul Helminger

On the occasion of the presentation of the airline's results, Christianne Wickler was appointed to the position of chairman of the board of directors. A seat that has been vacant since the recent death of Paul Helminger. She thus becomes the first woman to hold this position within the airline.

Wickler developed the Pall Center, the flagship of a group of supermarkets and grocery stores that she has been managing for 38 years. Co-founder of the citizen's collective 5fir12, she branched out into politics by running in 2013 for the legislative elections on the Green party list, in the north. She became a member of parliament when the ecologists joined the government. But six months after being sworn in and having juggled family, business and her political career at the same time, she gave up her position to devote herself to her group, which employs over 300 people.

This article was originally published in French for Paperjam.lu. It has been translated and edited for Delano.