Lufthansa still anticipates that it will be paying investors its annual dividend

Germany’s biggest airline company, Deutsche Lufthansa AG, anticipates more challenges for the rest of the year specifically lower ticket prices as a result of heightened terrorist attacks in the Euro region.

Lufthansa reduced its profit target for 2016, two weeks ago, and moderated growth plans following a significant decrease in bookings for long-haul flights to Europe after the UK referendum, a failed coup attempt in Turkey and successive attacks in several European countries.

Profits, which did not include currency fluctuations, dropped 0.8 percent compared to the 2md quarter of the previous year.

Meanwhile, the company’s financial head Simone Menne, said Lufthansa’s cargo division will likely suffer a loss due to large over-capacity among air freight carriers.

Other airline companies in Europe were affected by the scenarios and reduced expansion caused by pressure on ticket prices. Only a week ago, Air France-KLM announced its apprehensions that acts of terrorism will definitely impact revenues. British Airways also had a guarded outlook and outlined that business travel demand is still low because of the Brexit vote.

On Tuesday, the airline firm’s management said it plans to cut down unit costs between two and three percent for the rest of this year. The allocation does not include currency and fuel.

We do not have any knowledge on how people make their bookings. The company is losing group reservations from the United States and Asia because of travel warnings,” Menne said in a press briefing.

From January to June, unit costs declined 1.3 percent. Nonetheless, Lufthansa approved a new pay and pension agreement with its cabin crews. The company extended negotiations on wages as well as terms with Lufthansa’s pilots.

Chief executive officer Carsten Spohr said they were anticipating high-pricing pressure to go on and the only solution is for the company to become more efficient and consistent.

The company said it expects adjusted earnings for this year before interest and taxes to fall below figures in 2015. Last year, Lufthansa generated slightly more than $2.01 or 1.8 billion euro. However, management remained hopeful it is capable of paying dividends this year. This can be attributed partly to the pension deal with cabin crews that can facilitate a reduction in pension costs.

Major performance statistics indicate Lufthansa still has the capacity of making the payout although the final decision depends on the company’s supervisory board.