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Lufthansa Q3 Loss Narrows; Posts Positive Adj. EBIT

Lufthansa Group (DLAKF,DLAKY) reported that its net loss for the third-quarter narrowed to 72 million euros from 1.97 billion euros in the same quarter last year. On a per share basis, net loss was 0.15 euros compared to a loss of 3.80 euros in the previous year.

Quarterly adjusted EBIT, excluding restructuring costs of 255 million euros, was 272 million euros compared to negative 1.2 billion euros in the previous year. Including the restructuring expenses, Adjusted EBIT was 17 million euros compared to negative 1.26 billion euros in the prior year.

Group sales for the third-quarter nearly doubled year-on-year to 5.21 billion euros from 2.66 billion euros last year.

In the third quarter of 2021, capacity offered, measured in passenger-kilometers, was 50 per cent of the pre-crisis level of 2019, about twice as high as in the second quarter.

Overall, the airlines of the Lufthansa Group carried 19.6 million passengers in July, August and September. This represents 46 per cent of the pre-crisis level in Q3 2019.

Lufthansa noted that the response to the volunteer programs offered in Germany for employees of Deutsche Lufthansa AG and Lufthansa Technik AG significantly exceeded original expectations. Overall, more than 3,000 employees have opted to leave the Lufthansa Group voluntarily.

Through voluntary programs, in Germany alone a total of 4,000 employees have left the company so far in 2021, while agreements have been reached with 3,000 more. It means that depending on further developments a surplus of 3,000 employees or corresponding personnel costs currently remains in Germany, Lufthansa said in a statement.

Therefore, another volunteer program for cabin crews was launched at Lufthansa on November 1, which will run until the end of March 2022.

In total, around 107,000 people were employed by the Group at the end of September. The goal remains to secure the long-term employment of more than 100,000 people in the Group.

The Lufthansa Group expects demand to develop positively. At the end of the third quarter, new bookings had already reached around 80 per cent of the 2019 level.

The Lufthansa Group said it continues to expect capacity, measured in available seat-kilometers (ASK), of around 60 per cent of the pre-crisis level in 2019 for the fourth quarter, confirming its capacity expectation of around 40 percent of the pre-crisis level for the full year 2021.

For the first quarter of 2022, it targets capacity of around 65 percent of the level in 2019 and expected to increase to around 80 per cent in the summer and second half of the year. Therefore, for the full year 2022, the company expects a capacity of more than 70 per cent compared to 2019.

For the fourth quarter of 2021, Group EBITDA is expected to be positive, even assuming restructuring expenses of around 80 million euros. The Group expects to be able to avoid operating cash drain even in the seasonally challenging final quarter.

Looking ahead for the full year 2021, the Lufthansa Group continues to expect a year-on-year increase in Group revenue and to reduce the Adjusted EBIT loss to less than half of prior year.

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