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As expected, the Lufthansa pandemic drove a loss of over two billion euros - in the first quarter. The second quarter is getting worse. The Group is therefore faced with deep cuts, especially in terms of personnel.
Lufthansa confirmed in the morning that a loss of 2.1 billion euros had arisen in the first three months of this year. In addition to the operating loss of EUR 1.2 billion, there was a loss in futures transactions in the amount of EUR 950 million.
However, the crisis is far from over. Management expects an even higher loss in the current second quarter. CEO Carsten Spohr announced "far-reaching restructuring". This also includes the entry of the state, which is to save the company from bankruptcy with up to nine billion euros. The financial package still has to be approved by the EU Commission and then submitted to the shareholders for approval. For this purpose, an extraordinary general meeting is to take place on June 25th.
This shareholder meeting is by no means just a drop-off event. According to its executive board, Lufthansa would have run out of money at the end of June without the state's entry. "Without the stabilization measures of the Economic Stabilization Fund, the company would probably be insolvent within a few days of the planned extraordinary general meeting," said the invitation to the shareholders' meeting on June 25, published on Wednesday.
According to the Corona Rescue Act, Lufthansa needs a two-thirds majority there. If more than 50 percent of the shareholders vote, a simple majority is enough. If it does not come about, "bankruptcy is inevitable," warns the board around CEO Carsten Spohr.
After only three percent of the planned flights were able to take off in May, Lufthansa and its subsidiary airlines Eurowings, Swiss, Austrian and Brussels Airlines are gradually re-establishing passenger traffic from June.
Further course information on Lufthansa
The group expects to offer 40 percent of the originally planned capacity in September. Flights to tourist destinations in particular are to be expanded. At the height of the crisis, 700 of the fleet's 763 jets remained on the ground. Management estimates that 300 aircraft will still not fly in the coming year and 200 in 2022. The board continues to expect a fleet reduced by 100 aircraft in 2023.
Lufthansa is fighting the disaster by cutting costs, which will also affect the staff. Of the almost 137,000 employees, 87,000 are on short-time work. There is a personnel surplus of up to 20,000 employees, it was said in corporate circles. However, the "Lufthansa Technik" concession unit is not to be sold;
A solution is to be found with the unions to keep as many of them on board as possible through more part-time work and waiver of salaries. The Dax Group does not give a concrete outlook for the year as a whole due to the high level of uncertainty about future developments. The operating result should decrease "significantly" compared to the previous year.
The stock market seems ready to follow the crane's path. On Wednesday, the paper increased significantly in a fixed market environment by 7.73 percent to 10.19 euros. This indicates a lucrative business for the federal government, i.e. the taxpayer. The state only pays the nominal value of EUR 2.56 for the new shares - just over a quarter of today's market price. In the negotiations with the state, the executive board had unsuccessfully pressed for a higher price or a lower participation, Lufthansa admitted.
The low issue price is still justified, since the market value already reflects the hope of the state's entry and the associated rescue of Lufthansa, the document says. In the event of bankruptcy, the shareholders went practically empty.
As soon as the 5.7 billion euros including all coupons have been repaid, the state rescue fund will have to sell its shares again - at the earliest by the end of 2023 and only if the Lufthansa share is significantly above the entry price of 2.56 euros by then. If Lufthansa cannot pay the coupons by 2025, or if the airline is threatened with a takeover, the state can increase its stake to 25 percent plus one share - a blocking minority - by exchanging part of the silent participation in shares. He would get a discount on the market price again.
