Lufthansa Group posts operating loss of €5.5 billion in 2020

©Lufthansa Group airlines

Revenue at the Lufthansa Group fell to €13.6 billion in 2020 (previous year: €36.4 billion). Despite rapid and extensive cost reductions, the Lufthansa Group had to report an Adjusted EBIT of minus €5.5 billion (previous year: profit of €2.0 billion). The Adjusted EBIT margin was minus 40.1% (previous year: plus 5.6%). The operating cash drain in the fourth quarter of 2020 was around €300 euros per month. Progress in restructuring limited the impact of the intensified pandemic situation on earnings. Personnel costs were significantly reduced through workforce reductions, crisis agreements with social partners and short-time working. At year-end 2020, the number of employees was 110,000, around 20% lower than the previous year. The reported EBIT loss was around €1.9 billion lower at minus €7.4 billion, mainly due to exceptional write-downs on aircraft and goodwill. Net income amounted to minus €6.7 billion (previous year: €1.2 billion).

Capital expenditure at the Lufthansa Group was reduced by around two-thirds year on year in 2020 to €1.3 billion (previous year: €3.6 billion), mainly on the basis of extensive agreements with aircraft manufacturers. These provide for the postponement of aircraft deliveries in 2021 and beyond, so that annual capital expenditure will be lower than originally planned also in future years. Adjusted free cash flow was negative €3.7 billion (previous year: €203 million), with around €3.9 billion paid out for ticket reimbursements alone. This was offset by €1.9 billion in new bookings. The remaining cash outflow was limited by strict management of receivables and payables.

Net debt including lease liabilities increased to around €9.9 billion (previous year: €6.7 billion). Pension liabilities increased by 43% to €9.5 billion (previous year: €6.7 billion), mainly due to the drop in the interest rate used to discount pension obligations to 0.8% (previous year: 1.4%). 

As of December 31, 2020, the Lufthansa Group had available liquidity of around €10.6 billion, of which €5.7 billion related to unutilized government stabilization measures. By the end of 2020, the Lufthansa Group had drawn down government stabilization funds of around €3.3 billion, of which €1 billion has already been repaid in the meantime. (€1.00 = US$1.20 at time of publication.)

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