Lufthansa Posts Record $8.10 Billion Annual Loss

Date: 05 March 2021 - 21:27

News ID: ۸۸۲۴۸

BERLIN (Reuters) - Lufthansa may permanently ground more jets to emerge leaner from the coronavirus pandemic, the German airline group said, as it reported a record 6.7 billion euro ($8.10 billion) loss for 2020.
The group, which also owns Austrian Airlines, Swiss and Eurowings, trimmed its 2021 capacity plans as COVID-19 disruption drags on, but held out hope for a summer upturn.
"We are examining whether all aircraft older than 25 years will remain on the ground permanently,” Chief Executive Carsten Spohr said, pledging to make 2021 "a year of redimensioning and modernization” for the company.
He also confirmed the expected retirement of Lufthansa’s eight remaining Airbus A380 superjumbos - a younger but fuel-thirsty model that is harder to fill in a downturn.
Lufthansa reported a 1.14 billion-euro ($1.38 billion) fourth-quarter net loss with a 1.29 billion deficit in adjusted earnings before interest and tax (EBIT). Revenue fell 71% to 2.59 billion euros.
Its shares were down 2.3% at 12.49 euros as of 1230 GMT in Frankfurt, after gaining nearly 15% since the start of the year on recovery hopes.
Bernstein analyst Daniel Roeska said that despite "tangible progress” on cost-cutting at its airline subsidiaries, "Lufthansa mainline is still stuck at step one” with short-term crisis union agreements.
"More needs to happen - and faster,” Roeska said.
Lufthansa cut its global workforce by 20% to 110,000 in 2020 and is seeking to eliminate another 10,000 German jobs or equivalent wage costs.
The group, which received a government-backed 9 billion euro bailout last June, said it will operate at 40-50% of pre-crisis capacity this year, lowering its earlier 40-60% ambition.
Summer travel will nonetheless pick up swiftly whenever restrictions are eased, Spohr said, and Lufthansa stands ready to restore 70% of its schedule "in the short term”.
The group’s full-year net loss of 6.73 billion euros was on 13.59 billion euros in revenue, down 63%. The company predicted a narrower 2021 EBIT loss than last year’s 5.45 billion euros.
Analysts had expected losses of 6.63 billion euros for 2020 and 1.24 billion euros for the last three months, according to Lufthansa’s consensus polling.