Lufthansa AG (DLAKY) stock soared Wednesday after the company told investors that strengthening demand meant it has seen a substantial improvement in profitability and that two of its new ventures are expected to break even sooner than previously forecast.

The German carrier, Europe's second-largest, reported its best half-year result ever Wednesday, with revenue rising more than 10% to €17 billion ($19.8 billion) and adjusted operating earnings, doubling to €1.04 billion, both ahead of analyst forecasts. Net debt halved during the period to €1.1 billion.

Better load factors, lower unit costs and higher unit revenues all contributed to the solid result, while demand was particularly strong in Asia and North America.

Pricing also came in for a mention in the company's interim report, with CFO Ulrik Svensson describing the pricing environment as robust, which may have helped to ease tensions among investors after the company said last month that it would "chase volumes this summer".

Shares of Lufthansa rose more than 4% to change hands at €19.55 in response, outpacing gains for its industry counterparts and extending their year to date return to 57.2%.

The airline group now expects the full year result to be ahead of that seen in the prior year, which represents an upgrade from earlier guidance.

"All our airlines were able to improve their load factors despite raising their capacities," said Ulrik Svensson, adding; "We are also very satisfied with the developments at Eurowings, which now has every prospect of breaking even this year - earlier than anticipated."

Eurowings, which is a historic brand that has been rehashed by as a budget carrier by Lufthansa in order to help it compete against lower priced rivals, is now expected to break even a year ahead of schedule.

Budget carriers have been an increasing threat to Lufthansa not just because of their aggressive capacity expansion across major markets but also due to their encroachment on the German airline's home turf.

Ireland's budget carrier, Ryanair (RYAAY) - Get Report , added four new routes at Frankfurt airport last year and said it would add 10 flying from Hamburg airport, both core bases for Lufthansa in Europe.

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