Lufthansa Group believes the business can capitalise on momentum created in the second half of 2024 to achieve stronger financial returns in 2025, which it describes as a “year of transition”.
The European airline group made that assessment as it outlined weaker full-year profits for 2024, after the first six months in particular were affected by a series of challenges. At the same time, the business is working through its “top strategic priority” of turning around fortunes at its German operation, Lufthansa Airlines, whose challenges have weighed on company fortunes in recent quarters.
“Looking back, 2024 was a year of two halves for the Lufthansa Group,” said chief executive Carsten Spohr on 6 March as the full-year earnings were released. “In the first six months, we still had to cope with a significant decline in operating profit – due, among other things, to strikes, delayed aircraft deliveries and operational challenges at our hubs.”
The group also points to a “big decline in yields” at the start of summer 2024 as more capacity returned to the market.
”The trend was reversed in the course of the year with two consecutive quarters in which we generated revenue of over 10 billion euros each for the first time, and in the fourth quarter we exceeded the previous year’s profit,” Spohr adds.
Despite the stronger end to the year, the full-year adjusted EBIT from Lufthansa’s passenger airlines halved in 2024 to €1 billion ($1.08 billion), almost entirely driven by a €948 million fall in Lufthansa Airlines’ earnings, which saw the unit swing to a full-year loss of €94 million.
The turnaround at Lufthansa Airlines began eight months ago and is targeted at “improving efficiency, reducing complexity and increasing product quality – to ensure the long-term competitiveness of the airline”, the group says, adding that the full effects of its efforts will not be felt until 2026.