Slide 1: Investor Presentation
Investor Presentation Deutsche Lufthansa AG May 2024
Slide 2: Disclaimer
Disclaimer IMPORTANT: The following applies to this document and the oral presentation of the information in this document by Deutsche Lufthansa Aktiengesellschaft (the “Company”, and together with its consolidated subsidiaries, the “Group”) or any person on behalf of the Company, any question-and-a
Slide 3: Disclaimer
Disclaimer This Presentation does not constitute or form part of, and should not be construed as, an offer to sell or issue, or the solicitation of an offer to purchase, subscribe to or acquire, securities of the Company, its affiliates or an inducement to enter into investment activity in the Unite
Slide 4: Full Year 2023 Results
Full Year 2023 Results Strategy Update Investment in ITA Airways Operational and financial outlook Appendix Page 4
Slide 5: Lufthansa Group achieves third highest operating profit ever in 2023
Lufthansa Group achieves third highest operating profit ever in 2023 (in EUR million) FY23 FY22 Change in % Revenues 35,442 30,895 +15 Operating income 38,429 33,268 +16 Operating expenses 35,960 31,771 +13 Of which fuel 7,931 7,601 +4 Of which staff 8,310 7,223 +15 Of which depreciation 2,228 2,199
Slide 6: Q1 EBIT loss significantly impacted by strikes and lower Cargo results
Q1 EBIT loss significantly impacted by strikes and lower Cargo results compared to prior year Q1 ‘23 to Q1 ‘24 Adjusted EBIT bridge in EUR million Gross profit Strike impact Q1 2023 from growth less Cargo (excl. (Airlines, Q1 2024 Actuals cost inflation strike impact) Cargo, MRO) Other Actuals -15 -
Slide 7: Passenger Airlines: Strikes lead to a higher-than-expected operating loss
Passenger Airlines: Strikes lead to a higher-than-expected operating loss Operational KPIs Adjusted EBIT/(margin) Comments in EUR million ▪ Strikes and other disruption reduce Q1 ‘24 vs. 2023 capacity by around 5 percentage points relative to 2019 compared to ASK 66,871 +12.5% original plans (84% in
Slide 8: Passenger Airlines segment could not benefit from increased demand and revenues
Passenger Airlines segment could not benefit from increased demand and revenues since they were offset by strike impacts and slightly lower yields ASK Revenue Adj. EBIT Adj. EBIT Q1 2024 Performance vs. 2019 [m EUR] [m EUR] margin Lufthansa Airlines 80.4% 3,165 -640 -20.2% SWISS 91.5% 1,333 33 2.5%
Slide 9: Cargo down primarily due to tough comparison base; Lufthansa Technik up
Cargo down primarily due to tough comparison base – result of Lufthansa Technik up 4% excluding the impact from strikes Comments 151 -22 3 ▪ Cargo profits down in a challenging market and against a tough Q1 ’24 Q1 ’24 Q1 ’23 ex strike comparison base, on break-even level if the effects of strikes ar
Slide 10: Free cash flow performance driven by strong booking intake for summer
Free cash flow performance driven by strong booking intake for summer Q1 ‘24 Adjusted EBIT / Adjusted free cash flow in EUR million Q1 ’23 Adj. FCF: (728) 1,311 EUR 482m 10 2,308 (922) 305 (85) 570 (849) Net bookings inflow: + 1.6 bn Adjusted EBIT D&A Liability from Ticket-related Other1) Operating
Slide 11: A strong balance sheet enables the resumption of dividend payments
A strong balance sheet enables the resumption of dividend payments Liquidity Net debt and net pension liabilities1) in EUR billion in EUR billion Comments Increase in 10.4 10.8 pension ▪ Revolving credit facility renewed 8.4 discount rate and enlarged to EUR 2.5bn at 2.1 2.5 Target liquidity: by 0.1
Slide 12: Strategy Update
Full Year 2023 Results Strategy Update Investment in ITA Airways Operational and financial outlook Appendix Page 12
Slide 13: Lufthansa Group is delivering on its key strategic priorities
Lufthansa Group is delivering on its key strategic priorities Customer New Product Multi-Airline Transformation into Experience Generation Multi-Hub an Airline Group Page 13
Slide 14: Increasing customer satisfaction is our number one priority in 2024
Customer Product Multi-Airline Airline Group Increasing customer satisfaction is our number one priority in 2024 Offer Reliable Operations • Schedule regularity • Punctuality • Baggage handling Empower our Customers Digitally Customer • Seamless digital processes • Expansion of self-service options
Slide 15: Comprehensive product and service innovations define premium in Europe
Customer Product Multi-Airline Airline Group Comprehensive product and service innovations underline our aspiration to define premium in the European airline industry Lufthansa Allegris ▪ First flight on May 1st from Munich to Vancouver ▪ Five Business Class seating options with EUR 2.5bn All-Aisle-
Slide 16: The Group embarks on the largest fleet modernization in its history
Customer Product Multi-Airline Airline Group The Group embarks on the largest fleet modernization in its history Aircraft Deliveries in 2024 Orderbook 2024 – 2032 >20 new planes expected in 2024 >250 new aircraft on order A350 42 L O 777F 787 34 N G - H 777 20 A U Boeing 777F 8 L A320 787 A220 40 S
Slide 17: Technological and commercial innovation are key to decarbonization
Customer Product Multi-Airline Airline Group Technological and commercial innovation are key to decarbonization Technology drives Rising contribution Among top-ranked emission reduction made by customers airlines in CDP Specific CO2 emissions: More than one million Received top score (A-) in -2% FY
Slide 18: Emission reduction targets validated by SBTi
Customer Product Multi-Airline Airline Group Group’s emission reduction targets successfully validated by Science Based Targets initiative (SBTi) Index LHG CO2 Emissions (not to scale) 110 Major levers for CO2 Reduction: First European airline Growth Fleet (SBTi relevance) group and second Reduction
Slide 19: Multi-Hub and Multi-Brand strategy is key for the success of Lufthansa Group
Customer Product Multi-Airline Airline Group Multi-Hub and Multi-Brand strategy is key for the success of Lufthansa Group Customer centricity: • Strong national brands with unique identity • Customer offering tailored to market- specific needs • Connected networks offer maximum connectivity JOINT OP
Slide 20: Focus on the synergetic core of the Group further sharpened
Customer Product Multi-Airline Airline Group Focus on the synergetic core of the Group further sharpened Active consolidation Airline Synergetic core business aviation services 1) Passenger Airlines … MRO, IT Services, Portfolio cleanup Aviation Training … 2) Lufthansa City Airlines 3) ✓ Network, Ma
Slide 21: Investment in ITA Airways
Full Year 2023 Results Strategy Update Investment in ITA Airways Operational and financial outlook Appendix Page 21
Slide 22: ITA provides access to the Italian market and regional diversification
ITA provides the Group even better access to the very attractive Italian market and regional diversification Italy– aiskey market for Lufthansa Group Italy ITA & Lufthansa Group 3rd largest Economy in ▪ Attractive proposition to grow a profitable long- the EU (GDP) haul business in Rome Fiumicino ▪
Slide 23: Transaction terms minimize the Group's financial risk and create optionality
Transaction terms minimize the Group’s financial risk and create optionality ▪ Acquisition of 41% of shares in ITA Airways through a capital increase ▪ Investment into the company’s equity, no payment to Italian Ministry of Economy and Finance (MEF) Key terms ▪ Capital increase of EUR 325 million fu
Slide 24: Competitive cost base and modern fleet form a base for future growth
Competitive cost base and homogenous, modern fleet form a solid base for future growth Favorable cost position Modernized fleet 94 NewGen Highly competitive A330-900neo ▪ Homogeneous, all Airbus labour cost A350-900 fleet, allowing for 66 A320 efficiencies in operations and maintenance Group-leading
Slide 25: In combination with Lufthansa Group, ITA can realize its full potential
In combination with Lufthansa Group, ITA can realize its full potential by benefitting from the size and synergies of a global group COMMERCIAL & Global network management Access to global airline partner network (e.g. A++ JV with United and Air Canada) Global Integration into global distribution ch
Slide 26: Operational and financial outlook
Full Year 2023 Results Strategy Update Investment in ITA Airways Operational and financial outlook Appendix Page 26
Slide 27: Capacity growth planned will narrow the gap to competitors
The capacity growth planned by the Group’s airlines will narrow the gap to competitors in a still significantly supply-constrained market Capacity (in ASK vs. 2019, Jan – Oct 2024e) Industry-wide bottlenecks persist Europe North Atlantic Delays in new aircraft deliveries & +9% +13% shortages in supp
Slide 28: Lufthansa Cargo is well positioned to benefit from an air freight upswing
Lufthansa Cargo is well positioned to benefit from an upswing in the global air freight market Seizing opportunities from macro 125% recovery Expanding the Demand short-haul Supply freighter business 75% 2021 2022 2023 Improving Exploiting operational high Improving stability e-commerce cost growth
Slide 29: Lufthansa Technik launches growth program Ambition 2030
Lufthansa Technik launches growth program “Ambition 2030” Ambition 2030 Target Picture Increased market Preferred share in Americas and APAC Established defense business access to material and IP GLOBAL MRO Leader in Digital Tech DIGITAL Digitally enabled 01 Digitally transformed Ops through #1 1101
Slide 30: Only moderate increase in fuel costs expected in FY24
Only moderate increase in fuel costs expected in FY24 at current price levels LH fuel price exposure is well hedged1) in 2024 Expected fuel price sensitivity after hedging (FY 2024) LH mixed JET price in USD/to. as of March 31 Q2 FY 2024 1,107 1,140 1,165 1,201 1,232 155 145 1,051 1,077 1,103 1,138
Slide 31: Full year Adj. EBIT outlook assumes a strong second half
Full year Adj. EBIT outlook assumes a strong second half of the year based on higher capacity and strong bookings Q2 2024 FY 2024 Capacity1) ~92% of 2019 ~92% of 2019 RASK Low single-digit decline vs. PY Low single-digit decline vs. PY CASK Low single-digit increase vs. PY Low single-digit increase
Slide 32: Appendix
Full Year 2023 Results Strategy Update Investment in ITA Airways Operational and financial outlook Appendix Page 32
Slide 33: Traffic Data
Traffic Data Jan vs. 2023 Feb vs. 2023 Mar vs. 2023 Q1 vs. 2023 vs. 2019 Passengers in 1,000 7,408 11.4% 7,673 15.8% 9,278 9.8% 24,359 12.1% -17.2% Available seat-kilometers (m) 22,072 10.6% 20,938 16.4% 23,861 11.0% 66,871 12.5% -15.8% Revenue seat-kilometers (m) 17,294 11.5% 16,460 16.6% 19,519 9.
Slide 34: Operating KPIs of Passenger Airlines by region (Q1 2024)
Operating KPIs of Passenger Airlines by region vs. 2019 (unless stated otherwise) Total Q1’24 Europe Q1’24 Asia / Pacific Q1’24 Number of flights +6.5% ASK +12.8% ASK +30.9% ASK +12.5% RPK +14.7% RPK +25.7% RPK +12.4% SLF +1.3pts. SLF -3.4pts. SLF -0.1pts. RASK incl. currency1) -1.1% RASK incl. curr
Slide 35: Operating KPIs of Passenger Airlines by region (FY 2023)
Operating KPIs of Passenger Airlines by region vs. 2019 (unless stated otherwise) Total FY’23 Europe FY’23 Asia / Pacific FY’23 Number of flights -20.5% ASK -8.6% ASK -35.6% ASK -16.2% RPK -5.5% RPK -36.2% RPK -15.8% SLF +2.6pts. SLF -0.8pts. SLF +0.4pts. RASK incl. currency1) +14.4% RASK incl. curr
Slide 36: Calculation of operational airline KPIs
Calculation of operational airline KPIs Passenger Airlines, Q1 2024 1) Traffic revenues (€m) 5,146 1) Total Revenues (€m) 5,562 2) Not assignable (€m) 450 2) Other operating income (€m) 224 Yield = 3) Basis for Yield (1)–(2) (€m) 4,696 3) Reversal of provisions (€m) 53 RASK 4) RPK (m) 1) 53,273 4) F
Slide 37: Group P&L
Group P&L Lufthansa Group (in EUR m) Q1’24 vs. Q1’23 Revenues 7,392 +5% Total operating income 8,175 +6% Operating expenses 9,011 +13% Of which fees & charges 1,046 +15% Of which fuel 1,688 +0% Of which staff 2,254 +17% Of which depreciation 570 +5% Result from equity investments -13 +28% Adjusted E
Slide 38: Adjusted EBIT / Net Income Full Year 2023
Adjusted EBIT / Net Income Full Year 2023 in EUR million 2,682 (13) (348) (4) (380) (248) 1,673 (16) Adjusted EBIT adjustments Interest result Others Tax result Profit/loss from Profit/loss Net EBIT discontinued attributable to Income operations minority interests Page 38
Slide 39: EBIT / Adjusted EBIT bridge Q1 2024
EBIT / Adjusted EBIT bridge Q1 2024 in EUR million 0 (18) (3) (1) -849 -871 Adjusted EBIT Impairment of non- M&A & restructuring Net book gains Others EBIT current assets / related expenses assets held for sale Page 39
Slide 40: Cash flow statement
Cash flow statement Lufthansa Group (in m EUR) Q1’ 24 vs. Q1’ 23 EBT (earnings before income taxes) -939 -364 1 Depreciation & amortization (incl. repairable MRO materials) 613 +21 Net proceeds from disposal of non-current assets 4 -4 1 Significant decrease in the operating result compared to the pr
Slide 41: Multi-year financial overview
Multi-year financial overview Lufthansa Group (in EUR million, as reported) 2016 2017 2018 20191 2020 2021 20224 2023 Operating KPIs RASK ex currency -5.9% +1.9% -0.5% -2.5% -26.7% -6.1% -6.1% +11.0% CASK ex currency, ex fuel2 -2.5% -1.8% -1.7% -1.5% +84.6% -25.8% -25.8% +2.3% Profit & Loss Revenues
Slide 42: Maturity profile of borrowings as of March 31, 2024
Maturity profile of borrowings as of March 31, 2024 3,000 2,500 2,000 1,500 1,000 500 0 2024 2025 2026 2027 2028 2029 2030 2031 Straight Bond Hybrid Convertible Bond Schuldscheindarlehen Aircraft Finance (secured) Other* *Mainly bilateral loans – does not include operating lease payments; as drawn o