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LATEST NEWS

Monday, June 1st, 2020

German government takes 20% stake in carrier as Lufthansa bailout is agreed

In return for a €9 billion (US$9.8 billion) bailout package, Germany’s flag-carrying airline Lufthansa will relinquish up to a 20% stake in the carrier to the German government. In addition, Lufthansa will have to relinquish over 24 of its take-off and landing slots at Frankfurt and Munich airports to new competitors. There will be a time limit of eighteen months set on the uptake of these slots and if no new competitor does so, then they will be offered to existing competitors.

The package has been heavily negotiated with EU intervention and specific involvement of the EU Commission. "The scope of the conditions required in the EU Commission's view has been reduced in comparison with initial indications," Lufthansa said in a statement. The package is applicable to the whole Lufthansa group of airlines, which includes Austrian Airlines, Swiss International Air Lines and Eurowings, though in early April it had been announced that Lufthansa will be closing down Germanwings, its low-cost subsidiary.

The 20% share in the company means the German government will automatically become the leading shareholder in the company which recently posted a trading loss of €1.2 billion (US$1.31 billion), while it will also have the option to acquire a further 5% stake through the purchase of debt purchases. Lufthansa said: "The Supervisory Board must approve the stabilization package negotiated with the Economic Stabilization Fund (of the Federal Republic of Germany), including the commitments to the EU Commission. Subsequent to the Supervisory Board's decision, the company intends to convene an Extraordinary General Meeting in the near future to obtain shareholder approval for the WSF stabilization measures."

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HEICO Corporation's net income up 22% in first half of fiscal 2020

HEICO Corporation has reported that net income increased 22% to US$197.3 million in the first six months of fiscal 2020, up from US$161.1 million in the first six months of fiscal 2019. In the second quarter of fiscal 2020, net income decreased 8% to US$75.5 million as compared to US$81.8 million in the second quarter of fiscal 2019.

Operating income increased 1% to US$219.2 million in the first six months of fiscal 2020, up from US$217.1 million in the first six months of fiscal 2019. In the second quarter of fiscal 2020, operating income decreased 9% to US$108.2 million, as compared to US$119.2 million in the second quarter of fiscal 2019.

The company's consolidated operating margin improved to 22.5% in the first six months of fiscal 2020, up from 22.1% in the first six months of fiscal 2019. The company's consolidated operating margin was 23.1% in both the second quarter of fiscal 2020 and 2019.

Net sales decreased 1% to US$974.4 million in the first six months of fiscal 2020, as compared to US$981.8 million in the first six months of fiscal 2019. In the second quarter of fiscal 2020, net sales decreased 9% to US$468.1 million, as compared to US$515.6 million in the second quarter of fiscal 2019.

EBITDA increased 1% to US$262.7 million in the first six months of fiscal 2020, up from US$259.8 million in the first six months of fiscal 2019. In the second quarter of fiscal 2020, EBITDA decreased 9% to US$130.0 million, as compared to US$142.2 million in the second quarter of fiscal 2019.

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HEICO Repair Group is the world’s largest independent component MRO with capability for over 26,000 unique aircraft parts, servicing over 60,000 components annually. www.heico.com

Lockheed Martin delivers first KC-130J Super Hercules Tanker to U.S. Marine Corps Reserve squadron

Lockheed Martin has delivered the first KC-130J Super Hercules tanker assigned to Marine Aerial Refueler Transport Squadron 452 (VMGR-452), the Marine Forces Reserve squadron at Stewart Air National Guard Base, New York. A U.S. Marine Corps crew ferried the aircraft from Lockheed Martin’s facility onn May 28 to the aircraft’s new home.

VMGR-452 is the second Marine Reserve squadron to operate KC-130Js and this delivery signifies the recapitalization of the squadron’s existing KC-130T fleet. VMGR-452 — known as the Yankees — has operated Hercules tankers for more than 30 years, flying KC-130s in support of Operations Desert Storm, Enduring Freedom and Iraqi Freedom.

KC-130s are operated in support of the Marine Air-Ground Task Force (MAGTF) commander by providing tactical in-flight refueling for fixed-wing, rotary-wing, and tilt-rotor aircraft; aviation delivered ground refueling of aircraft or tactical vehicles; assault air transport or air-landed or aerial-delivered (parachute) personnel and equipment; pathfinder support, battlefield illumination; tactical aeromedical evacuation; and tactical recovery of aircraft and personnel support.

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Frontier Airlines announces 18 new nonstop routes for summer 2020

Low-fare carrier Frontier Airlines has announced 18 new routes for summer 2020. The new flights beginning in June and July expand the airline’s growing presence in major cities, including Boston, Chicago, Newark and Philadelphia.

As another step to support the health and well-being of customers, the carrier will implement mandatory temperature screenings for passengers and team members beginning June 1, 2020.

“We’re pleased to announce 18 new routes and demonstrate our commitment to providing low fares to great destinations for our customers as the country reopens,” said Daniel Shurz, senior vice
president of commercial for Frontier Airlines. “Frontier has been at the forefront in implementing numerous measures to support passenger well-being in-flight and we are seeing a strong uptick in summer travel demand. We anticipate these new routes to a variety of popular vacation destinations will be in high demand as family and friends seek affordable domestic summer travel options.”

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GE Aviation awarded US$394 million by DLA for J85 engine supplies

GE Aviation has been awarded a US$394 million contract from the Defense Logistics Agency (DLA) to provide J85 engine supplies for the United States Air Force and Navy. The work will be carried out by GE Aviation’s facility in Lynn, MA, and across GE’s U.S. supply chain sites.

The DLA classifies the new contract as part of its Captains of Industry (COI) program, which uses Supplier Capability Contracts to streamline the procurement process.

Since entering service in 1959, the J85 engine has reliably powered military aircraft including the T-38, F-5, T-2C, and A-37B, accumulating more than 75 million hours. More than 13,000 engines have been produced and the J85 operates in 28 countries.

The J85-powered T-38 is the USAF's primary pilot training aircraft. The single-shaft axial-flow turbojet engine with an 8-stage compressor section and 2-stage turbine gives the T-38A a top speed of Mach 1.3.

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Frankfurt Airport steps up flight services from this week on

Flight services at Frankfurt Airport are being stepped up significantly from June 1. They will focus on connections between cities in Europe, but flights to popular vacation destinations will also increase. Further long-haul destinations are also being added to the timetables.

Daily capacity is now up to around 26,000. This is around 10% of the previous year's figure. The airport operator expects a gradual build-up of flight services in the weeks ahead. However, as overall volumes remain well below last year's levels due to the coronavirus pandemic, Terminal 1 will remain the focal point of all passenger handling activities for the time being.

Airlines reserve the right to change flight services at short notice. Passengers should always check the latest information from their airline before traveling. They are also advised to look up the current travel advice of the German Federal Foreign Office.

Frankfurt Airport has been ready to step up flight operations since mid-May. Airport operator Fraport has implemented extensive anti-infection measures in the areas currently in use in Terminal 1, in line with all health authority regulations.

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Tamar Jorssen
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Tamar