Deutsche Lufthansa Ag · XETR:LHA
Deutsche Lufthansa — Q1 2024 Earnings Presentation
30 slides from Deutsche Lufthansa's earnings presentation, Apr 30, 2024
Slide 1: Q1 2024 Results
Internal Q1 2024 Results Carsten Spohr, CEO Remco Steenbergen, CFO Frankfurt, 30 April 2024
Slide 2: Q1 2024 Results: Review Q1 & Commercial Outlook
Internal Q1 2024 Results Carsten Spohr, CEO Review Q1 & Commercial Outlook Frankfurt, 30 April 2024
Slide 3: Lufthansa Group was exposed to a particularly challenging market environment in Q1 2024
Lufthansa Group was exposed to a particularly challenging market environment in the first quarter of 2024 Geopolitical instability Supply chain issues Challenging home markets Capital Delayed aircraft and High and further increasing War against Ukraine seat deliveries location costs Escalating confl
Slide 4: Strikes had a significant impact on the Group's results in the first quarter
Strikes had a significant impact on the Group’s results in the first quarter Revenues Adjusted EBIT EUR 7.4bn EUR -0.8bn +5% vs. 2023 -0.6bn vs. 2023 Strike Impact Strike Hours Regularity EUR >500 95.7% 350m Page 4
Slide 5: We continued to push ahead with our strategic priorities
Although we had to overcome a difficult quarter, we continued to push ahead with our strategic priorities Investing in the offer Improving short-haul Securing long-term wage Regaining strength in profitability agreements home markets Enhancing customer Improved feeder traffic Strict fixed cost Stron
Slide 6: Lufthansa Allegris and SWISS Senses create a whole new travel experience
The introduction of Lufthansa Allegris and SWISS Senses creates a whole new travel experience for guests on long-haul routes Lufthansa Allegris ▪ First flight on May 1st from Munich to Vancouver ▪ Five Business Class seating options with EUR 2.5bn All-Aisle-Access (AAA) Investment in ▪ First Class S
Slide 7: Significantly investing in upgrading the (digital) customer experience
We are significantly investing in upgrading the (digital) customer experience Key service innovations in 2024 Seamless Enhanced payment Enhanced seat maps Booking flow booking flow wallet & shopping cart personalization Travel Targeted & contextual Advanced baggage Integrated airport companion ancil
Slide 8: Launch of Lufthansa City Airlines strengthens the Group's feeder network
Launch of Lufthansa City Airlines strengthens the Group’s feeder network and supports the planned growth of Lufthansa long-haul routes Lufthansa City Airlines Ramp-up Start of ▪ 4 A/C until year-end ~50 Operations ▪ ~1 A/C monthly from 2025 ff. ~40 ▪ Start of Sales April 24 ▪ A319, A320neo, A220 ~30
Slide 9: Long-term collective wage agreements make our airlines reliable again
The recent conclusion of several long-term collective wage agreements for important working groups makes our airlines reliable again for customers Workforce1) Term of agreements Comments 2024 2025 2026 ▪ Three major agreements, covering ~5% Cockpit more than 42,000 employees, Cabin concluded in the
Slide 10: Current bookings indicate that the summer will be strong
Current bookings indicate that the summer will be strong – strikes are only having a short-term impact on demand Booking Intake (tickets sold per calendar week vs. PY, excl. Eurowings) Point of Commencement (tickets sold in Q1 ’24 vs. PY; excl. EW) +11% +12% +10% Strike impact +8% +7% +9% +9% +6% +6
Slide 11: Q1 2024 Results: Financial Overview
Internal Q1 2024 Results Remco Steenbergen, CFO Financial Overview Frankfurt, 30 April 2024
Slide 12: 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 13: 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 14: Cargo down 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 Adjusted EBIT in EUR million 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
Slide 15: 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 16: 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 17: Fuel cost expectation remains unchanged compared to March guidance
Fuel cost expectation remains unchanged compared to March guidance 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 1,169 Hedge
Slide 18: FY CASK is expected to remain flat excluding the Q1 one-off strike impact
FY CASK is expected to remain flat excluding the Q1 one-off strike impact – in line with prior guidance Group Airlines CASK Comments in EUR ct low-single-digit % increase ▪ Unit costs expected to remain stable compared to previous year excluding strike impact +0.1 ~6.5 ▪ Rise in personnel costs refl
Slide 19: Full year Adj. EBIT outlook assumes a strong second half of the year
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 (ex fuel, emission costs) Low single-digit increase vs. PY
Slide 20: Q&A
LUFTHANSA GROUP Page 20
Slide 21: Appendix - supplementary information
Appendix - supplementary information- Page 21
Slide 22: 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 23: Operating KPIs of Passenger Airlines by region vs. 2023
Operating KPIs of Passenger Airlines by region vs. 2023 (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 24: 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 25: Performance of Group Airlines in Q1 2024
Performance of Group Airlines in Q1 2024 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% Austrian Airlines 92.4% 403 -122 -30.3% Brussels Airlines 83.3% 289 -58 -20.1% Eurowings 87.4% 420 -137 -3
Slide 26: 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 27: 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 27
Slide 28: 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 29: 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 (change vs. prior year) 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
Slide 30: 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