Before the US restart: Lufthansa on course

Status: 03.11.2021 8:24 a.m.

The boom in the cargo business and the ramp-up of passenger flights have given Lufthansa a surprisingly good result. The partially nationalized airline is heading for its pre-crisis level.

Only a few days before the planned opening of the US borders for vaccinated EU citizens, Lufthansa presented a surprisingly good quarterly result. “With the increasing demand for business trips and a record result for Lufthansa Cargo, we were able to master another milestone on our way out of the crisis: the return to the black,” said Lufthansa boss Carsten Spohr, pleased.

Further losses on balance

However, the partially nationalized airline has only managed to return to the black in operational terms: the adjusted operating result in the third quarter amounted to 17 million euros after a loss of 1.2 billion euros in the same period of the previous year. The MDAX group exceeded the expectations of the analysts, who had forecast an average of EUR 33 million.

But the bottom line is that Lufthansa continued to be in the red in the third quarter. At least she could reduce her minus significantly. The loss amounted to 72 million euros in the months from July to September after a loss of 2.0 billion euros in the same period of the previous year.

Lufthansa Cargo with record results

The result in the freight business was positive: the logistics division was able to increase its adjusted operating result from 169 million euros in the previous year to 301 million euros. In the history of Lufthansa Cargo, this result is a record for this period.

As in the previous quarters, Lufthansa Cargo benefited from the sustained high demand in the global airfreight market, which was further intensified by bottlenecks in ocean freight and the disruption of global supply chains, the press release said.

New bookings at 80 percent of the pre-crisis level

While the Lufthansa Group has not only reached its pre-crisis level in the freight business, but even exceeded it, things are still not going quite as smoothly in the passenger business.

After all: In the third quarter, the airline was able to expand the number of seat kilometers offered to 50 percent of the pre-crisis level of 2019. With 19.6 million passengers in July, August and September, Lufthansa achieved 46 percent of the pre-crisis level.

Supported by the opening of further important long-haul markets for travelers from Europe, especially the USA, the number of new bookings increased significantly. They are currently back at around 80 percent of the pre-crisis level.

US restart is getting closer

From Monday, after a 20-month ban in the USA, entry for vaccinated and additionally tested EU citizens will be possible again. There are currently around 200 connections to 17 US destinations in the weekly flight schedule of the Lufthansa Group, which also includes Swiss, Austrian, Eurowings and Brussels Airlines. Lufthansa had never completely given up the flights to the USA, as US citizens, diplomats and other groups of people were allowed to continue flying in addition to the freight.

In the meantime, Lufthansa is moving further and further out of the crisis financially: On October 5, the airline completed a capital increase with which it had collected 2.16 billion euros in fresh capital to repay state aid. The remaining share of the German economic stabilization fund amounts to 14.09 percent of the total capital.

The Lufthansa share reacted with price gains to the presentation of the quarterly figures. On the Tradegate trading platform, it gains 1.6 percent to EUR 6.04 in early trading.

The overriding downward trend since March 2021 will therefore persist. On the stock market, too, it will take a while to return to pre-crisis levels. For comparison: two years ago a Lufthansa share was worth more than 11 euros.

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