Lufthansa back to profit after the Covid waiting for the agreement with Italy Airways go to port. The German airline closes 2022 not only with the doubling of turnover — 32,8 billion euros compared to 16,8 billion the year before — but also a Adjusted Ebit positive for 1,5 billion, against -1,7 billion in 2021. Net debt has also improved, from 9 billion it has fallen to 6,9 billion. Despite high cost inflation, net profit was 791 million euros, against the red of 2,2 billion in 2021. This was thanks to strong travel demand that led the group — which includes Lufthansa, Swiss, Austrian Airlines, Brussels Airlines, Eurowings and Air Dolomiti — also doubling the number of passengers: 102 million against 47 million the year before.
Seeing in detail, once again, divisions dragged Lufthansa's accounts positively Job (+1,6 billion adjusted EBIT) e Technology, i.e. maintenance (+511 million). The blockade of the airlines is still in negative territory (for 300 million euros). Going to look at the individual services we note the positive adjusted Ebit for 476 million euros Swiss, +3 million Austrian Airlines. In the negative Brussels Airlines (-74 million), Eurowings (-197 million) e Lufthansa (-466 million).
Il title Lufthansa runs to the Frankfurt Stock Exchange, driven by the results: it leaps by 5,46% trading above 10 euros.
Spohr (Lufthansa): "Record revenues in 2023 and 12.000 hires"
“Lufthansa is back. In just one year we have achieved an unprecedented financial breakthrough,” said the CEO Carsten Spohr whose managing director contract was extended for a further five years. “Demand for air travel remains high in 2023 and we are investing billions in new state-of-the-art, fuel-efficient aircraft. With innovative services, a new premium cabin on board and new digital instruments”. In this regard, the CEO explained that the group intends hire 12.000 employees during 2023 for all the companies in the group, "equal to a thousand hires per month". In a press release, Lufthansa also explains that it has decided to maintain liquidity between 8 and 10 billion euros in the future to better protect itself "from potential future crises" (as at 31 December 2022 the cash amounted to 10,4 billion) and having already returned public aid (in Austria and Belgium) to overcome the pandemic.
Outlook for 2023
For 2023 Lufthansa has raised the guidance and expects further progress towards reaching the targets set for 2024, but warns that capacity development will be limited by the "bottlenecks still foreseen in the European aviation system". In any case, it expects a further significant improvement in Adjusted Ebit in 2023 (by at least 8%) and Roe adjusted by at least 10%. In line with normal seasonality, earnings are expected to be particularly strong during the summer season. In the first quarter, Adjusted Ebit should be negative.
Lufthansa and Ita Airways: where are we?
For the first time, in the note, the group refers to negotiations ongoing for acquire Ita Airways. Lufthansa explains that "following the signing of a letter of intent by the group and the Italian Ministry of Economy and Finance, both parties are currently negotiating exclusively on the form of a potential investment in the Italian airline ITA". The intention is for the company to “initially buy a minority stake” – which according to sources close to the dossier should be equal to 40% and should take place through a capital increase – and subsequently “the remaining part. If a agreement will be signed the operation will require the go-ahead from the competent authorities”, reads the financial document.
The German group recalls that the January 18 last “An offer, in the form of a letter of intent, has been submitted to the Italian Ministry of Economy and Finance for the acquisition of a stake in the national airline Ita Airways. The letter of intent was signed on January 27”.
"The Italian market is strategic for us and investment in Ita is essential," Spohr said during the annual press conference. “We aim to make Ita profitable within a few years”.
