Lufthansa Group reported a record financial performance in the second quarter of 2023 due to continued high demand for air travel and high yields. Lufthansa Group’s adjusted EBIT in Q2 reached a record €1.1 billion, the highest ever second quarter results for not only Lufthansa but also for SWISS, Austrian Airlines, Brussels Airlines, Eurowings, and Lufthansa Technik.
Three mergers and acquisitions that took place in the second quarter have been dubbed significant by Lufthansa, marking them as a milestone in the group’s transformation process to an airline group. The group also reduced its net debt to below pre-crisis level.
Furthermore, Lufthansa Group specifies that it expects an adjusted EBIT of at least €2.6 billion for the full year 2023.
According to Lufthansa Group CEO, Carsten Spohr, the strong performance can be attributed to the efforts of their employees worldwide and the group’s focus on stability. Spohr added that the group’s recruitment campaign, hiring over 1,000 new employees per month, contributes to a positive outlook for the company.
In Q2, the group’s revenues stood at €9.4 billion, exceeding the previous year’s value by about 17%. The operating result or adjusted EBIT increased to €1.1 billion, almost tripling the previous year’s result of €392 million euros, signifying an operating margin of 11.6%.
Net income marked a new high at €881 million, up from the previous year’s €259 million. For the first half of 2023, the group posted an adjusted EBIT of €812 million, an improvement of almost €1 billion from the previous year.
The group’s passenger airlines saw a significant rise in passenger numbers due to high global demand for air travel. Between January and June, over 55 million passengers flew with the group’s airlines, an increase of 30% compared to the same period in 2022.
Despite operating costs increasing due to industry-wide inflation and one-time costs associated with the expansion of flight operations, the group’s passenger airlines improved their adjusted EBIT by around €1 billion to €965 million in Q2.
Lufthansa Cargo and Lufthansa Technik also reported positive results. Lufthansa Cargo’s adjusted EBIT decreased to €37 million, down from the previous year’s €482 million, but still significantly higher than the 2019 result. Lufthansa Technik reported a very positive business performance in Q2 2023, with adjusted EBIT of €156 million, a 39% increase from 2022.
As part of the group’s transformation into an Airline Group, three significant transactions were completed in Q2, including the sale of LSG Group and AirPlus, and the agreement to acquire a minority share of 41% in Italian airline ITA Airways.
See also: Lufthansa Group Seals Deal and Buys a 41% Stake in ITA Airways
The group also maintains a focus on sustainability, aiming to become carbon-neutral by 2050 and halve its net CO2 emissions compared to 2019 levels by 2030. The group plans to invest over €2 billion every year in new generation aircraft, such as the Airbus A350 and the Boeing 787, which are expected to be delivered by 2030.
For the remainder of the year, Lufthansa Group expects high demand for flight tickets. Bookings for August to December 2023 are on average more than 90% of the pre-crisis level. The group plans to offer around 88% of pre-crisis capacity in Q3. Adjusted EBIT in Q3 is expected to exceed the pre-crisis level of €1.3 billion in 2019.
For the full year 2023, Lufthansa Group now expects to achieve an adjusted EBIT of more than €2.6 billion, an upgrade from the previous expectation of a significant increase from 2022’s value of €1.5 billion. Lufthansa states that 2023 will form an essential step towards achieving the financial targets the company has set for 2024.
