Coronavirus | Germany's Lufthansa narrows losses in secondquarter

404
2

FRANKFURT, Aug 5 - Germany's Lufthansa said on Thursday it further narrowed its losses in the second quarter and recorded its first positive cash flow since the start of the coronavirus crisis, citing faster than anticipated cost cuts.

The group, which also owns Eurowings, Swiss, Brussels and Austrian Airlines, said its adjusted operating loss reduced from one year earlier to 952 million euros, down 43% on average and less than the 971 million euros forecast in a company-provided poll.

Revenue topped 3.2 billion euros against a forecast of 3.3 billion euros.

Lufthansa, which set out plans to return to profitability with fewer planes and staff than it had before the coronavirus pandemic pummelled travel industries in June, said it continued to expect high demand for tourist destinations and recovery in business travel in the second half of the year.

The group reported adjusted cash inflow of 340 million euros in the second quarter after a 1.13 billion outflow a year earlier.

We have been able to generate the outflow of funds in the first phase of Revitalizing our business and break the negative cash flow for the current period since beginning of pandemic, Chief Executive Carsten Spohr said in a statement.

The Group said its airline carried 7 million passengers in the quarter ending June 30, 18% of the pre-crisis levels in 2019, but as planned carried capacity gradually improved over the quarter to reach 40% at the end of June.

Lufthansa also confirmed its objective to reach 40% capacity level in 2021, with operating loss significantly below the last year total of nearly 5.5 billion euros.

The airline said it had already reached half the 3.5 billion euros in cost cuts planned by 2024, six months earlier than planned citing better than expected absorption of voluntary redundancies programs in Germany and Switzerland.

The plans envisage a fleet that is 20% more efficient, but also smaller and a 1.8 billion euro reduction in staff costs.