Lufthansa, Europe's second-largest airline, today said operating profit was 577 million euros ($696 million) in calendar 2005, up 51 percent from $459.6 million the previous year, lifting net income from $484.8 million to $543.6 million on revenues 6.5 percent higher at $21.6 billion.

The German carrier credited strong passenger growth in Asia and a doubling of cargo earnings that outweighed soaring fuel prices. It expects this year's profit to match or exceed 2005 results.

Lufthansa Cargo, the world's biggest international air freight carrier, boosted operating profit to $124.8 million from $62.4 million in 2004 on revenues 11 percent higher at $3.3 billion.

Revenues were driven by an increase in freight rates which more than compensated for a 1 percent decline in traffic to 1.736 million metric tonnes and a 1.3 percent drop in capacity. Stronger growth in the United States and Asia, as well as fuel surcharges, outweighed a slowdown in European exports

Lufthansa said capacity utilization slipped by two percentage points to 65 percent, but added it is now concentrating on profitable routes and will not pursue a policy of "growth at any price."