Lufthansa Nearer To Decision On MRO Future
Lufthansa has indicated that a clearer picture of Lufthansa Technik’s future will emerge in early 2022.
Responding to media speculation that Lufthansa had appointed JP Morgan to examine options such as a partial stake sale or an IPO for the MRO arm, Lufthansa’s chief financial officer, Remco Steenbergen, said that the airline group was in the “middle of the process” of evaluating a path forward.
“Of course, it's extremely important to think it's through very carefully,” he said on an analyst call. “So no formal decision has been made.
But of course, doing such an investigation is because we would be interested to do a minority [stake sale] in case there is value to be created, and it works overall.”
He added: “I would expect that during our next call in the beginning of next year, we can give you some more information.”
Steenbergen and Lufthansa chief executive Carsten Spohr were also keen to point out that Lufthansa Technik posted encouraging third-quarter results, with pre-tax earnings of €165 million ($187.6 million), excluding restructuring costs, and activity back at 70% of pre-crisis levels.
Spohr also noted that increasing flying hours are boosting demand for component services and said that demand for engine maintenance is “gaining momentum.”
Other work is being directly driven by the pandemic itself, with Lufthansa Technik currently working on around 60 parked aircraft to ensure they are ready to fly again for the summer season.
The MRO arm is also helping to convert temporary freighter aircraft—created by removing seats from passenger aircraft—back into passenger configurations to respond to that demand.
“We just have converted the last freighter aircraft faster back to passenger,” said Spohr, adding: “I would think others do that as well because everybody now needs the aircraft again for passengers.”