Lufthansa cuts losses as Ukraine weighs on outlook

FRANKFURT – Agence France-Presse

German carrier Lufthansa said on March 3 it had cut its losses by two-thirds in 2021, but warned of uncertainty for the industry from the coronavirus pandemic and Russia’s invasion of air. ‘Ukraine.

Europe’s largest airline group – which includes Eurowings, Austrian, Swiss and Brussels Airlines – recorded a net loss of 2.2 billion euros ($2.4 billion) in 2021, compared to a net loss of 6 .7 billion euros a year earlier.

Lufthansa said it expected business to improve this year, but “major uncertainties” surrounding Ukraine and the future course of the pandemic made it difficult to provide more detailed forecasts.

Russia’s invasion of its neighbor has disrupted Lufthansa services, with the airline suspending flights to Russia or Ukraine.

The escalation of the conflict involving the main energy supplier, Russia, has also given a boost to already high fuel prices.
Rising oil costs would create “additional burdens” for the group, Lufthansa said, while saying it expected to weather the increases better than competitors.

Rising airport charges and “remaining uncertainties regarding the evolution of the pandemic” have further clouded the outlook for the industry.

The number of passengers increased in 2021 by 29% compared to the previous year, when travel restrictions due to the pandemic caused the figure to drop.

“We are absolutely certain that air traffic will experience a strong recovery this year,” chief executive Carsten Spohr said in a statement.
Lufthansa said it expects “over 70% average capacity” in 2022 compared to the pre-pandemic year 2019, compared to 40% this year.

The group also said it expected “further year-on-year improvements” for 2022 in its operating result, where it cut losses to 2.3 billion euros from 5 .5 billion euros, despite higher than expected restructuring costs.
Lufthansa posted its first quarterly operating profit since the start of the pandemic in the third quarter of 2021, but fell back to a loss of 271 million euros in the October-December period.


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