Lufthansa Group Achieves Best-ever First Half Year Results

The Lufthansa Group increased its total revenues by 12.7 percent to 17 billion euros in the first six months of 2017, up from 15 billion euros during the same period last year.

According to an announcement, the Group’s traffic revenues were up by 14.2 percent to 13.3 billion euros, up from 11.6 billion euros in 2016. And the key earnings indicator of adjusted EBIT was roughly doubled to over 1 billion euros (529 million euros in 2016), giving the Lufthansa Group its best-ever first half year earnings result.

“We have achieved the best first half-year result in our company’s history,” said Ulrik Svensson, Chief Financial Officer of Deutsche Lufthansa AG. “In addition to strong demand and a robust pricing environment, this is attributable to the fact that we achieved a further structural reduction in costs,” Svensson said

Ulrik Svensson, Chief Financial Officer of Deutsche Lufthansa AG.

According to Lufthansa, unit costs excluding fuel and currency effect declined by 1.2 percent in the first half-period, and by 3.4 percent in the second quarter alone. Unit revenues at constant currency were raised by 0.5 percent, and by 1.8 percent in the second quarter. Load factors were up on their prior-year levels in all traffic regions, despite increased capacity. The adjusted EBIT margin of 6.1 percent was a 2.6-percentage-point improvement on the prior-year period.

Net profit for the first half of 2017 amounted to 672 million euros, a 56.6 percent improvement on the prior-year period (429 million euros). Cash flow from operating activities rose more than 1 billion euros to 3.2 billion euros. Lufthansa said the increase was driven by the good result and more advance bookings for the third-quarter period.

“Our key financial performance indicators have been significantly improved further,” Svensson confirmed, adding that the company’s free cash flow has almost doubled, and its net financial debt has been more than halved.

“Higher revenues and lower costs have enabled us to soundly finance the investments required for new aircraft and an attractive product. All of which is vitally important in keeping our company the number one in Europe.”

Moreover, the airlines of the Lufthansa Group raised their total first half year revenues by just under 700 million euros to 11.1 billion euros, thanks to stronger demand in all traffic regions.

“All our airlines were able to improve their load factors despite raising their capacities,” Svensson said. “This shows that our products are well received by our customers. As a result, our network airlines in particular made a substantial contribution to our improved overall earnings.”

The Lufthansa Group forecasts an adjusted EBIT for 2017 above previous year.