GoDubai
  
  
  
  
Citylife > Press Release
  Home Contact us Add to Favourites
Most Recent Postings
More Press Releses
Featured Sections

Event Finder
A daily roundup of exhibitions, promotions and other events in Dubai and the rest of the Emirates.
Submit an Event
Latest Dubai Press Releases >>

 
  Share
Results for 2017
  • Adjusted EBIT increased around 70 percent to some EUR 3 billion
  • Adjusted EBIT margin raised 2.9 percentage points to 8.4 percent
  • Earnings growth primarily driven by the Group's airlines (including cargo)
  • Revenues up 12.4 percent to EUR 35.6 billion
  • Unit costs further reduced
  • 60 percent higher dividend proposed at EUR 0.80 per share
Outlook for 2018
  • Stable unit revenue development expected
  • Unit costs to be further reduced by 1 to 2 percent
  • Higher fuel costs of some EUR 700 million expected to be largely compensated by improved operating performance
  • Adjusted EBIT for the year expected to be only slightly below its record in
  • 2017
“Our endeavors of the past few years are paying off. Our modernization has a sustainable impact. We have achieved the best result in the history of our company. 2017 was a very good year for our customers, our employees and our shareholders,” says Carsten Spohr, Chairman of the Executive Board & CEO of Deutsche Lufthansa AG. “Last year we were able to reduce costs again, while at the same time becoming the first – and the only – airline in Europe to be awarded a five-star rating. We arelowering our costs where this does not affect the customer, and are simultaneously further investing in our product and service quality.”
 
Total revenues for the Lufthansa Group in 2017 amounted to EUR 35.6 billion, a 12.4 percent increase on the previous year. The Adjusted EBIT of EUR 2.97 billion was a significant 69.7 percent year-on-year improvement. And the 8.4 percent Adjusted EBIT margin was up 2.9 percentage points compared to previous year. EBIT for the year increased more than EUR 1 billion to EUR 3.3 billion. The strong increase of EBIT includes the positive EUR 582 million one-off effect from agreeing on the collective labor agreement with the Vereinigung Cockpit union for the pilots of Lufthansa, Lufthansa Cargo and Germanwings, which was recognized in the income statement in December.
 
“We are particularly pleased that we were again able to lower our passenger airlines' unit costs excluding fuel and currency factors last year. This is in particular as passenger related costs were actually up due to higher load factors, the variable remuneration was higher in light of strong result development, and additional costs because of compensation paid for the flight cancellations at Air Berlin burdened our cost as well,” adds Ulrik Svensson, Chief Financial Officer of Deutsche Lufthansa AG. “Excluding these one-off effects, we reduced our unit costs by 1.8 percent.”
 
The Lufthansa Group invested some EUR 3 billion in 2017, around a third more than in the previous year. This is partly due to investments of some EUR 900 million into aircraft from the Air Berlin flight operations. “These higher investments also reflect the increased size of our Group. But investments relative to revenue remain on one level with the world's most successful airlines',” comments Ulrik Svensson.
 
“Important is that the return on capital continues to increase. In 2017, our Adjusted ROCE (after tax) improved by 4.6 percentage points to 11.6 percent.”
 
Despite the higher capital expenditure, free cash flow almost doubled in 2017 to EUR 2.3 billion. Net financial debt rose 6.8 percent to EUR 2.9 billion. This figure includes an initial EUR 1.7 billion funding for the new defined contributions model of the flight attendants' pension fund. Total pension provisions decreased by EUR 3.2 billion in 2017. The year-end equity ratio stood at 26.5 percent, an increase of 5.9
percentage points.
 
“On the basis of these very good results, we propose a dividend of EUR 0.80 per share to the Annual General Meeting,” says Ulrik Svensson. “This is a 60 percent increase of the pay-out compared to last year. This is the minimum level of dividend payment that we aim to maintain in the coming years.”
 
Network Airlines
The Group's Network Airlines – Lufthansa, SWISS and Austrian Airlines – increased their Adjusted EBIT by nearly 50 percent to some EUR 2.3 billion. With strong demand and a positive pricing environment, the Network Airlines raised their EBIT margin 2.6 percentage points to almost ten percent.
 
Point-to-Point Airlines
Despite the significant expenses in the context of acquiring capacities from Air Berlin, Eurowings reduced its unit costs excluding fuel and currency factors by 6.5 percent. On the back of this and strong market demand, Adjusted EBIT increased by some EUR 200 million. Despite adverse one-off factors related to market consolidation, the Group's Point-to-Point Airlines improved their Adjusted EBIT margin by 7.3 percentage points and achieved a positive Adjusted EBIT of around EUR 100 million. The inorganic growth after the insolvency of Air Berlin will make a positive contribution to the Point-to-Point Airlines' from 2019 onwards.
 
Aviation Services
The Group's Aviation Services in total achieved a very good result, though the development among the business segments was quite different. A combination of
cost reductions and strong demand helped Lufthansa Cargo to improve its Adjusted EBIT by almost EUR 300 million to EUR 242 million. The EUR 415 million earnings of Lufthansa Technik were broadly in line with prior-year levels. Against the background of the continuing transformation of its European operations, the LSG Group sustained a EUR 38 million decline in its earnings for the year to EUR 66 million.
 
Outlook
EUR 700 million higher fuel costs can be largely offset by an improved operating performance, so that for 2018 in total an Adjusted EBIT only slightly below previous year is expected. Organic capacity is expected to increase by some seven percent, as unit revenues excluding currency factors should remain broadly stable. Unit costs excluding fuel and currency factors should be further reduced by 1 to 2 percent.
 
“We will continue to consistently pursue our modernization,” concludes Carsten Spohr. “And in doing so, we will retain our clear focus on reducing our costs and at the same time raising our quality. This is the only way to sustainably increase our profitability. From a position of strength, we will continue to drive consolidation in Europe.”
 
Lufthansa Group    January to December 4th Quarter
2017  2016 Change  2017   2016 Change
Total revenues EUR m  35,579 31,660  +12.4% 8,818  7,790 +13.2%
of which traffic revenue EUR m 28,399 24,661 +15.2% 7,039 5,987 +17.6%
EBIT EURm  3,310 2,275 +45.5% 875 -55  
Adjusted EBIT EUR m 2,973  1,752   +69.7% 413 75
+450.7%
Adjusted EBIT margin    8.4% 5.5% +2.9pts  4.7%  1.0%  +3.7 pts
Adjusted ROCE (after taxes)    11.6% 7.0% +4.6pts      
Net income  EUR m  2,364 1,776 +33.1% 511 -75  
Capital expenditure  EUR m  3,005  2,236 +34.4% 1,203 602 +99.8%
Operating cash flow EUR m  5,035 3,246  +55.1%  576  192  +200.0
%
Employees as of 31.12   129,424 124,306  +5,118      
Earnings per share EUR  5.03   3.81 +32.0% 1.09  -0.16  
 



Posted by : GoDubai Editorial Team
Viewed 19282 times
Posted on : Thursday, March 15, 2018  
Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of GoDubai.com.
Previous Story : IATA Innovates Dangerous Goods Handling
Next Story : Turkish Airlines Closes Airbus and Boeing Orders
Email this article Print this article

Share this article with your friends and followers
NewsVine

Comments

Back to Top  
Most Viewed Press Release posted in the last 7 days
NARS Erdem SS19 Beauty Report
Diana Arno Expands Online Shopping to Middle East
Introducing Home Fragrance at Robinsons, Dubai Festival City
Introducing VK Beauty Lounge & Bar
Defying Age With Skin Republic's Gold and Platinum Face Masks
The Future Is Here
Roberto Cavalli's Exclusive Duo of Fragrances
Lacoste.12.12 Collection
Bring a Touch of Sophistication to Your Home with The Exclusive SmegXDolce&Gabba...
FOREO To Attend TFWA: the World's Largest Travel Retail Show
Trevor Sorbie Range Relaunches in the UAE
Dubai Parks and Resorts Celebrates Saudi National Day
Honor Set to Go Beyond Limits With the Launch of Honor 8x
Carl F. Bucherer Celebrates Debut of Its Online Boutique on Jd.Com Launch of Lim...
O Boticário Opens in Dubai its First Amphora Store outside Brazil Come Join...
Pamper yourself at Perfumery & Co this month, at The Dubai Mall
The Mummies of Dubai Give Their Kids a Preppy Style Makeover
GROHE Smart Home: The App-Controlled Water Security System
Huawei Deepens Cooperation with Duisburg to Transform Germany's Industrial Hear...
Ministry of Human Resources and Emiratisation, Huawei and Honor launch ICT Compe...
New GUESS Handbags for FW18
Le Meridien Dubai Hotel & Conference Centre's Restaurant Promotions- October
Hyperloop Transportation Technologies, Partners, and Government Stakeholders Mov...
William Collection by Hugo Boss
Al-Futtaim ACE launches its stylish new Outdoor collection
du Wins Smart Cities Award at the Telecoms World Middle East 2018
Tips & Toes Hits the Big 3-5!
Honda voted “Preferred Sedan Car Brand of the Year” for the fourth year in a row
Al-Futtaim Toyota swoops another win at the Filipino Times Awards
Dubai Design Week continues to grow, cementing Dubai as the design capital of t...
Eberhard & Co. Scafograf 100 For Elegant Lady
Mousses Etoiles to reveal the latest luxury designs of commercial-use outdoor fu...
Tata Communications launches a specialised cyber security lab at Shanmugha Arts,...
Consonni Wraps Up La Vuelta a Espana With a Seventh Place Finish for UAE Team Em...
Abu Dhabi wins bid to host 2022 ITU Grand Final in world first
Akamai Unveils Solutions at IBC 2018 Designed to Mitigate the Challenges and Cos...
Cadillac XT4 Delivers Dynamic Driving Experience
WWE® Crown Jewel Set for November 2 in Saudi Arabia
du Opens New Business Centre in DIFC for Enterprise Customers
New Homologations for Pirelli Tyres
The Ferrari Monza SP1 and SP2 unveiled – the first models in a new concept of li...
Volunteers from the UAE join hands with the community in Tasset Peulh village in...
Sharjah's Recognition as ‘Accessible City for Physically Disabled' Hailed as His...
Dubai Festival City Mall Celebrates KSA National Day with Special Imagine Show
2018 FW in style at Zippy
The Dubai Business Women Council meets with the UN Assistant Secretary-General t...
Fidu Properties unveils second office in Dubai; eyes expansion in UAE
Registration for the 5th edition of Camel Trek is now open
New Headmaster for Repton School, Abu Dhabi School's Rose Campus (FS1 to Year 1...
Huawei becomes one of the first multi-national technology companies to register ...