Loss of billions in the first quarter: Lufthansa "only" burns just under eight million euros per day

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Supply forecast reduced:

Lufthansa flight attendants would like to work more - but there are still too few flights

Photo: Andreas Arnold / DPA

The ongoing corona crisis in aviation once again turned Lufthansa's balance sheet deep red in the first quarter. From January to March, the group posted a net loss of one billion euros, with sales falling by 60 percent to 2.56 billion euros. Thanks to cost reductions, the loss was only half as high as in the same quarter of the previous year, when the pandemic almost brought passenger air traffic to a standstill from March onwards.

"The longer the crisis lasts, the greater people's longing to travel again," said Lufthansa boss

Carsten Spohr

(54) on Thursday. Due to the growing pace of Covid vaccinations and test options, Lufthansa expects demand to rise sharply in the summer. Nevertheless, it reduced its supply forecast for the year as a whole to 40 percent of the pre-crisis level after previously expected 40 to 50 percent.

Lufthansa also gave an outlook for the coming years: by 2024 it predicts a capacity of 90 to 95 percent, with demand for vacation flights recovering more strongly than that for business trips.

The Kranich-Linie and Eurowings want to head for more tourist destinations than ever in the future, which led to a conflict with the vacation airline Condor.

Lufthansa wanted to make it more difficult for Condor to integrate its feeder flights into their long-haul connections, but after the intervention of the Cartel Office it has to give in here.

Cargo and technology in black

The airline group, which in addition to the main brand Lufthansa also includes Swiss, Austrian and Brussels Airlines as well as the holiday airline Eurowings, was hit so hard by the corona shock that it had to be rescued with a billion-dollar financial package. The debt was last at 10.9 billion euros, the available funds were almost as high. Of the nine billion euros in government aid, 5.4 billion euros have not yet been called up. While all of the airline subsidiaries posted losses, the freight business again achieved a record profit, as freight prices are high when there is a shortage of supply. Lufthansa Cargo earned 314 million euros operationally. The maintenance division Lufthansa Technik was also in the black with an operating profit of 60 million euros.

The airlines' hopes for a recovery in passenger air traffic have so far not been fulfilled. The governments in Europe are fighting the third wave of Covid infections with travel restrictions and advise against all non-urgent travel. Analysts have recently expressed skepticism about the prospects of the airlines. The rating agency Moody's said that the summer travel season in Europe will not pick up until mid-August. To do this, the vaccination rate would have to be significantly accelerated. "The risk is growing that the long-awaited recovery will postpone to 2022," said Bernstein Research. No airline will be in the black again this year.

Spohr based his confidence on the great advances in vaccination. A uniform vaccination certificate is to be introduced in the EU by June, which allows travel without the obligation to quarantine. The announcement by the EU Commission that vaccinated passengers from the USA will be able to travel to Europe again is encouraging.

In the first quarter, the Lufthansa Group only had a fifth of the capacity of the pre-crisis level, with which it carried three million passengers - only 10 percent of the previous year's level.

The costs fell, among other things, through staff cuts, because the MDax Group now employs a good 111,000 people, almost a fifth less than in the previous year.

In addition, short-time working continues to relieve a large part of the workforce.

The monthly outflow of funds could be limited to an average of 235 million euros.

At times it was more than twice as high.

In the second quarter it should fall further to 200 million euros.

The group could get along with its liquidity this year, but wants to have the option of a capital increase of up to 5.5 billion euros approved at the general meeting next week.

mg / Reuters