Lufthansa Group faces profit decline despite revenue growth in Q2 2024

The Lufthansa Group has increased its second-quarter revenues by seven percent to €10 billion in 2024 (prior-year period: €9.4 billion). The Group recorded an operating profit, or Adjusted EBIT, of €686 million (prior-year period: €1.1 billion). The Group net result amounted to €469 million (prior-year period: €881 million). The prime drivers here were the 11% expansion of the flight programme in the passenger business and the strong performance in the MRO segment, whose second-quarter revenues were 16% up on the prior-year period.

In addition to the increasing normalisation of ticket prices and an associated market-related decline in yields in all traffic regions, particularly in the second quarter, the strikes at various Lufthansa Group companies and external system partners also impacted earnings for the period by more than €100 million. Moreover, operating expenses increased by 10% due to the expansion of passenger flight operations, but also to inflation-related cost increases. Total second-quarter revenue for the passenger airlines increased by 4.5% to €8 billion (prior-year period: €7.7 billion). The airlines reported an Adjusted EBIT of €581 million (prior-year period: €965 million). For the first six months of 2024, the Group’s passenger airlines generated total revenue of €13.6 billion, some five percent more than in 2023. First-half Adjusted EBIT declined to €337 million compared to the previous year (H1 2023: €453 million). Lufthansa Airlines is particularly confronted with challenges resulting from the negative market development in the key Asia-Pacific traffic region, but also faces inefficiencies in its Lufthansa and CityLine flight operations. The significant delays in aircraft deliveries are causing upheavals in areas such as fleet management and also through the additional maintenance costs for the older aircraft still in use. The disproportionately high increase in location costs in Germany and new collective labour agreements for cockpit, cabin, and ground staff also had a negative impact on earnings.

As a result, the second quarter Adjusted EBIT of €213 million is some €300 million below its 2023 level (prior-year period: €515 million). Overall, Lufthansa Airlines recorded a first-half loss of €427 million (prior-year period: profit of €149 million).

Achieving a breakeven full-year result is becoming increasingly challenging for Lufthansa Airlines. In addition to short-term measures to safeguard earnings, the airline has launched a comprehensive turnaround programme to increase efficiency, reduce complexity and improve quality, and thereby make the core brand fit for the future. (€1.00 = US$1.08 at time of publication).