Lufthansa Group recorded a net loss of €68 million ($73 million) for the first quarter of 2017, deepened from the company’s €8 million net loss in 1Q 2016. But first-quarter revenue for the entire Lufthansa Group was a reported €7.7 billion, up 11.2% over €6.9 billion in 1Q 2016.  It is the first positive territory quarterly revenue result the German aviation group has posted in nine years.

“For a period that is traditionally difficult for the airline industry, we have posted our first positive earnings result since 2008,” Lufthansa Group CFO Ulrik Svensson said. “This is mainly attributable to favorable trends at Lufthansa Cargo and strong growth at Lufthansa Technik [which] demonstrates the strength of our broad setup as [an] aviation group.”

As of the first of the year, Lufthansa Group’s structure is now composed primarily of three major business segments: Network airlines Lufthansa German Airlines, Austrian Airlines and Swiss International Airlines; its Point-to-point airlines Eurowings, Germanwings  and the recently acquired Brussels Airlines; and Aviation Services, which includes the company’s catering, MRO (Lufthansa Technik) and logistics (Lufthansa Cargo) business elements.

Operating expenses for the Group totaled €8.2 billion, up 8.6% over €7.6 billion in the year-ago quarter.  Fuel expenses for the consolidated group were up 11.4% year-over-year (YOY) to €4.4 billion. The absorption of Brussels Airlines into Lufthansa’s fold in January increased the total workforce of the Lufthansa Group to nearly 129,000 employees. Staff costs rose 6.3% YOY during the first quarter, to €2.1 billion.

Lufthansa Cargo posted an 18.5% year-over-year (YOY) jump in revenue to €569 million; Lufthansa Technik’s revenue increased 12.8% YOY to €1.5 billion.  The Group’s Point-t-Point airline segment posted an 81.2% increase in revenue to €683 million, largely a result of the consolidation with Brussels Airlines, which Lufthansa acquired fully from Brussels’ parent company SN Airholding on Jan. 9, 2017, combined with higher passenger volumes recorded over the quarter.  Revenues for Lufthansa's network airlines were a consolidated €4.9 billion, up 4.8% YOY.

Mark Nensel