Lufthansa’s Cargo and MRO Arms Lead Recovery
With its passenger demand back to near-pre-crisis levels, Lufthansa has reported a much better year for its maintenance arm.
Lufthansa Technik’s pre-tax profit (EBIT) reached €210 million ($231.1 million) for the 2021 calendar year, following a €383 million EBIT loss in 2020.
This made it the best performing Lufthansa subsidiary in 2021 apart from Lufthansa Cargo, which saw profit rocket up 69% year on year to €1.5 billion on the back of unprecedented air freight demand.
Lufthansa Technik’s sales rose 7% in the year, to €4 billion, thanks to a recovery in customer flying hours and the positive impact of this on full-service maintenance contracts.
Following encouraging third-quarter results last year, when the MRO provider posted pre-tax earnings of €165 million, Lufthansa Group chief executive Carsten Spohr noted that increasing flying hours were boosting demand for component services and he said that demand for engine maintenance was “gaining momentum”.
Nonetheless, its parent group is continuing preparations for a partial divestiture or IPO of Lufthansa Technik, which it plans to execute in the course of 2023.
Lufthansa Technik serviced 4,208 aircraft under exclusive contracts in 2021. In the year, the company won42 new customers and signed 621 contracts with a volume of €4.7 billion.
As part of its restructuring, this March Lufthansa Technik intends to finalise the sales of base maintenance company Lufthansa Technik Shannon as well as line maintenance operations in Frankfurt and Brussels to external companies.
At the same time, the company is seeking to grow its digital services via its AVIATAR platform, noting that the “coronavirus pandemic has continued to result in greater demand for digital MRO services so that future physical maintenance inspections can be organised more cheaply and reliably”.