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Tuesday, March 9th, 2021

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Lufthansa Technik's 2020 revenue down 43% due to CORONA crisis

Lufthansa Technik has released its annual report for 2020 in which revenue and earnings were significantly lower than 2019 due to the effects of the COVID-19 pandemic on the aerospace sector. The crisis has had a considerable adverse effect on the development of the MRO business, with a significant decline in flight hours across the industry and financial pressure on the airlines leading to aircraft being grounded and decommissioned, which had a major impact on Lufthansa Technik.

Significant cost reductions are now being deployed to improve the company's competitiveness and secure its long-term, defining role in the independent MRO market. As a consequence, instead of the previous eight company divisions, there will be only five in the future: Aircraft Component Services (ACS), Aircraft Maintenance Services (AMS), Engine Services (ENG), Original Equipment & Special Aircraft Services (OES) and Digital Fleet Services (DFS).

Revenue fell in the financial year 2020 by 43% to €3,747 million (previous year: €6,572 million) as a result of the CORONA crisis. This was mainly due to a significant decline in Europe, Lufthansa Technik’s most important sales market. Revenue with Lufthansa Group companies saw a decrease in volume, particularly in the engine business. Group external revenue decreased mainly in the component and engine maintenance divisions. Operating income of €4,184 million was 39% lower than in the previous year (previous year: €6,828 million).

Operating expenses fell by 30% in the reporting period to €4,502 million (previous year: €6,425 million) due to lower volumes and the cost-cutting measures implemented. Cost of materials and services decreased by 39% to €2,372 million (previous year: €3,902 million), primarily as a result of lower volumes. This included crisis-related write-downs of materials totaling €158 million. At €1,113 million, staff costs were 23% lower than in the previous year (€1,448 million), the main reason being the introduction of short-time work. Depreciation and amortization increased by 3 % to €197 million euros (previous year: €191 million).

Adjusted EBIT decreased accordingly to €-383 million (previous year: €463 million), and the adjusted EBIT margin decreased by 17.2 percentage points to -10.2 %. EBIT at the end of the reporting period was €-508 million (previous year: €472 million). The difference to the adjusted EBIT was mainly due to impairment losses on investments in joint ventures and on spare engines. Capital expenditure was reduced by 51% to €152 million compared to last year (previous year: €313 million), mainly due to lower investments into spare engines.

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MAAS Aviation partners with FL Technics to create re-delivery center in Kaunas, Lithuania

Following a multi-million Euro investment, MAAS Aviation, recognized experts in aircraft painting and exterior coatings, has opened a new purpose-built paint shop at Kaunas Airport (KUN) in Lithuania, adjacent to FL Technics’ MRO facilities. Combining base maintenance, painting and parking/storage in one location is an attractive proposition for leasing companies. It minimizes aircraft ground time which offers economic value and less complexity for lessors.

MAAS Aviation’s ultra-modern Lithuanian facility is a twin-bay narrow body paint shop capable of accommodating up to two A321 sized aircraft simultaneously and is the first of its kind in Lithuania. It grows the company’s global footprint to eleven best-in-class paint shops and increases its overall MRO capacity in Europe by 40%.

The 40% increase in MAAS Aviation’s European MRO capacity enables the company to service more airlines and lessors particularly during peak seasons. The MRO repainting sector is normally cyclical with winter peaks and for many years MAAS has juggled capacity constraints during these periods due to demand from its long-term contracted customers.

In the build up to establishing this new facility MAAS Aviation has experienced a dynamic growth trajectory surpassing 180% over the past six years. In 2015 the company had three paint shops in two locations and 130 aircraft were painted. In 2021, MAAS has eleven paint shops (three in Hamburg; two in Kaunas; two in Maastricht; one at Fokker Woensdrecht; and three in Mobile, Alabama) and the company forecasts painting up to 300 aircraft.

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Singapore Airlines pilots IATA's travel pass app

Singapore Airlines (SIA) will pilot the International Air Transport Association’s (IATA) Travel Pass mobile application for digital health verification, starting with passengers travelling from Singapore to London from March 15 to 28, 2021. This marks the second phase of SIA’s digital health verification process trials, which is based on the IATA Travel Pass framework. 

Passengers with mobile phones running on Apple’s iOS operating system will be invited to download the IATA Travel Pass app, and create a digital ID comprising their profile photo and passport information. They can also insert their flight information into the app.

Subsequently, they can book their pre-departure COVID-19 test at one of seven participating clinics in Singapore via a dedicated online portal. They can then register at the clinic using the digital ID and flight information in the app. They will be able to view their test results, as well as confirmation status to fly, directly on the app. IATA’s Timatic registry will provide the back-end information on the Covid-19 testing and entry requirements.

Participants will need to show their confirmed status in the app to the check-in staff in Changi Airport before flight departure. In line with current regulatory requirements, they will also need to bring a physical copy of their health certificate that is issued by the clinic where they took their COVID-19 test.

If successful, the pilot will pave the way for the integration of the entire digital health verification process into the SingaporeAir mobile app from around mid-2021, again using IATA’s Travel Pass framework.

SIA will continue to work closely with its partners in Singapore and around the world in the facilitation of these trials, and towards the eventual restoration of a seamless travel experience for its customers.

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Swissport signs airport ground services contract with IAG for Berlin Brandenburg Airport

Swissport and International Airlines Group (IAG) have signed a three-year contract covering airport ground services for the airlines of IAG at the new Berlin Brandenburg International Airport in the German capital. Since the opening of the new airport, Swissport has been growing its customer base to currently 17 airlines, providing them with a full range of ground services.

A British Airways flight to London Heathrow was the first flight under the new agreement with the British-Spanish airline group at the new Berlin Brandenburg International Airport. The three-year contract covers airport ground services for flights of British Airways, Iberia and Vueling, including passenger services at check-in and gates, ramp handling, baggage loading and pushback services, as well as aircraft cleaning. The cooperation starts with three flights every weekend in March and will be extended to two daily flights from April 1, 2021.

Honeywell develops new turbogenerator to power hybrid-electric aircraft

Honeywell is developing a power source for hybrid-electric aircraft, planned for demonstration later this year.

At 280 pounds, the Honeywell 1-Megawatt generator weighs about the same as a motor scooter but delivers enough energy to power an entire neighborhood block. This generator will be combined with the Honeywell HGT1700 auxiliary power unit, currently flown on every Airbus A350 XWB, to form a turbogenerator 2.5 times more powerful than the version the company unveiled in 2019.

The new turbogenerator from Honeywell will be able to run on aviation biofuel, including Honeywell Green Jet Fuel, which is chemically similar to fossil fuel but made from more sustainable alternatives, as well as conventional jet fuel and diesel. Honeywell’s turbogenerator can be used to operate high-power electric motors or charge batteries and can satisfy missions from heavy-lift cargo drones to air taxis, or commuter aircraft. The first demonstration of this turbogenerator system will occur in the third quarter of 2021, with ongoing development and qualification to follow.

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Lufthansa Cargo Supervisory Board extends contract of COO Harald Gloy

Harald Gloy has been appointed to the Executive Board of Lufthansa Cargo AG for a further five years. The company's Supervisory Board unanimously extended his contract until December 31, 2026. In addition to responsibility for Operations, Gloy has also assumed the role of Chief Human Resources Officer as of March 1, 2021 and thus, as part of a restructuring within the Cargo Executive Board, will henceforth also bear responsibility for Human Resources and Procurement at the company.

Gloy has been with the Group since 1999 and was appointed Chief Operations Officer of Lufthansa Cargo AG on January 1, 2019. Previously, the industrial engineer held various management positions at Lufthansa Technik.
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