Lufthansa sees 2024 operating results on par with last year as costs rise
By Joanna Plucinska and Ilona Wissenbach
LONDON/FRANKFURT (Reuters) — Lufthansa reported on Thursday an operating profit of 2.7 billion euros for 2023 as expected and said 2024 operating results will be on par with last year as the German airline struggles with costly labour disputes.
The impact of strikes and a drop in logistics profits will lead to a higher expected operating loss in the first quarter than in earlier years, the German airline said, offsetting strong post-COVID travel demand.
«The group remains committed to its goal of generating a sustainable adjusted EBIT margin of at least 8 percent,» the company said in a statement.
Europe's airlines have benefited from unprecedented demand after the pandemic, allowing them to raise prices, but higher labour and maintenance costs have limited earnings growth.
Lufthansa in particular has agreed to new, higher pay deals to end strikes, which analysts and investors say threatens its 2024 operating margin target.
On Wednesday, its cabin staff voted to go on strike as they seek a 15% wage increase, a potential harbinger of further profit erosion.
The results come almost two weeks after the airline announced the surprise departure of respected chief financial officer Remco Steenbergen, which knocked its share price and rattled investor confidence.
Operating profits for 2023 were up 76% from 1.5 billion euros ($1.63 billion) in 2022. Revenues of 35.4 billion euros ($38.58 billion) were up almost 15% over 31 billion euros ($33.79 billion) in 2022, but were lower than the 36.3 billion euros ($39.56 billion) expected in a company-issued poll.
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Despite the adjustment in operating margin target, the company said its results were strong enough to propose issuing a
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