Deutsche Lufthansa Ag · XETR:LHA
Deutsche Lufthansa — Q1 2023 Earnings Presentation
27 slides from Deutsche Lufthansa's earnings presentation, May 3, 2023
Slide 1: First Quarter 2023 Results
First Quarter 2023 Results Carsten Spohr, CEO Remco Steenbergen, CFO Frankfurt, 03 May 2023 lufthansagroup.com
Slide 2: Disclaimer
Disclaimer The information herein is based on publicly available information. It This presentation contains statements that express the Company‘s has been prepared by the Company solely for use in this opinions, expectations, beliefs, plans, objectives, assumptions or presentation and has not been v
Slide 3: First Quarter 2023 Results
First Quarter 2023 Results Carsten Spohr, CEO Frankfurt, 03 May 2023 lufthansagroup.com
Slide 4: Improvements in all areas in Q1 form the basis for a successful year
Improvements in all areas in Q1 form the basis for a successful year Adjusted EBIT Revenues Passengers EUR EUR 7bn 22m -273m +40% vs. 2022 +9m vs. 2022 Yield Operating Cash Flow Net CAPEX +19% EUR 1.6bn ~ EUR 1bn vs. 2019 Page 4
Slide 5: The Lufthansa Group is ready for a strong summer
The Lufthansa Group is ready for a strong summer Close alignment Strong booking with 787 infrastructure Short-haul momentum touristic continues partners demand exceeds 4,500 2019 levels Stable operational new staff recruited in the first 3 months performance over Easter peak Premium leisure demand s
Slide 6: 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 6
Slide 7: Lufthansa Group is well positioned for a successful future
Lufthansa Group is well positioned for a successful future Lufthansa Group has delivered on its recovery plan ✓ Completed the financial turnaround ✓ On track for the achievement of our 2024 financial targets ✓ In the process of implementing significant product and service improvements for our custom
Slide 8: First Quarter 2023 Results
First Quarter 2023 Results Remco Steenbergen, CFO Frankfurt, 03 May 2023 lufthansagroup.com
Slide 9: Q1 result improves significantly year-on-year despite increased seasonality
Q1 result improves significantly year-on-year despite even increased seasonality and costs related to the summer ramp-up (in EUR million) Q1 ’23 Q1 ’22 Change in % Revenues 7,017 5,002 +40 Operating expenses 7,979 6,096 +31 Of which fuel 1,686 987 +71 Of which staff 1,922 1,632 +18 Of which deprecia
Slide 10: Passenger Airlines: Losses more than halved due to higher yields and loads
Passenger Airlines: Losses more than halved due to higher yields and loads Operational KPIs Adjusted EBIT Comments in EUR million ▪ 19% yield increase versus 2019 Q1 ’23 vs. 2022 vs. 2019 indicative of ongoing strong pricing -512 power especially in long-haul, seat load ASK 59,347 +30% -25.3% -1,114
Slide 11: Lufthansa Cargo's profits normalize – Adjusted EBIT up in all other segments
Lufthansa Cargo’s profits normalize – Adjusted EBIT up in all other segments Adjusted EBIT in EUR million Comments 495 151 ▪ Cargo profits normalize from prior year Q1 ’23 Q1 ’22 record base – yields still up >60% compared to 2019 levels in Q1 135 ▪ Lufthansa Technik result benefits from 129 strong
Slide 12: Adjusted free cash flow performance driven by strong operating cash flow
Adjusted free cash flow performance driven by strong operating cash flow Q1 Adjusted EBIT / Adjusted Free cash flow in EUR million (244) (424) (99) (228) 1,581 2,314 (1,032) 482 (67) 535 -273 Adjusted D&A Liability from Ticket-related Receivables Remaining Other1 Operating Net CAPEX2 Repayments Adju
Slide 13: Further progress on the way back to an investment grade rating
Further progress on the way back to an investment grade rating Liquidity Net debt and net pension liabilities Shareholder equity EUR billion EUR billion EUR billion 10.4 10.5 2.1 2.1 8.9 8.7 Target liquidity: 8.5 EUR 8-10bn 7.6 2.0 2.0 8.3 8.4 6.9 6.7 Dec 31, 2022 Mar 31, 2023 Dec 31, 20221 Mar 31,
Slide 14: Sale of LSG Group is a major step in the transformation into an airline group
Sale of LSG Group is a major step in the transformation into an airline group Sale of LSG Group to private equity investor AURELIUS announced in April - Transaction expected to close in Q3 2023 Process underway to divest a minority stake Full divestment planned once fair value can be realized Page 1
Slide 15: Option-based fuel hedging offers protection while leaving the opportunity to benefit from lower prices
Option-based fuel hedging offers protection while leaving the opportunity to benefit from lower prices Expected fuel cost sensitivity after hedging (FY 2023)1 Hedging portfolio excl. LH Cargo as of April 26, 2023 102 Q2 FY 2023 1,000 850 750 650 500 ø Market price crude oil2 92 700 550 450 350 250 H
Slide 16: Group expects to make significant progress in 2023 towards the 2024 targets
Group expects to make significant progress in 2023 towards the 2024 targets Q2 2023 Full Year 2023 Full Year 2024 Capacity (ASK) Capacity (ASK) Adjusted EBIT margin c.82% of 2019 levels c.85-90% of 2019 levels At least 8% Yield Adjusted EBIT Adjusted ROCE (excl. cash) Up to 25% above 2019 Significan
Slide 17: Appendix - supplementary information
Appendix - supplementary information- Page 17
Slide 18: Traffic Data
Traffic Data Jan vs.2019 Feb vs.2019 Mar vs.2019 Q1 vs.2019 Passengers in 1,000 6,621 -27.0% 6,602 -27.1% 8,420 -25.4% 21,643 -26.4% Available seat-kilometers (m) 19,931 -24.3% 17,964 -26.6% 21,451 -25.1% 59,347 -25.3% Revenue seat-kilometers (m) 15,483 -22.9% 14,094 -24.8% 17,739 -23.2% 47,316 -23.
Slide 19: Operating KPIs of Passenger Airlines by region vs. 2019
Operating KPIs of Passenger Airlines by region vs. 2019 (unless stated otherwise) Total Q1’23 Europe Q1’23 Asia / Pacific Q1’23 Number of flights -29.8% ASK -23.7% ASK -41.3% ASK -25.3% RPK -18.4% RPK -39.3% RPK -23.6% SLF +5.0pts. SLF +2.8pts. SLF +1.8pts. RASK incl. currency1) +16.6% RASK incl. cu
Slide 20: Calculation of operational airline KPIs
Calculation of operational airline KPIs Passenger Airlines, Q1 2023 1) Traffic revenues (€m) 4,806 1) Total Revenues (€m) 5,211 2) Not assignable (€m) 518 2) Other operating income (€m) 303 Yield = 3) Basis for Yield (1)–(2) (€m) 4,288 3) Reversal of provisions (€m) 66 RASK 4) RPK (m) 1 47,316 4) FX
Slide 21: Group P&L
Group P&L Lufthansa Group (in EUR m) Q1 ’23 vs. Q1 ’22 Revenues 7,017 +40.3% Total operating income 7,693 +39.2% Operating expenses 7,979 +30.9% Of which fees & charges 909 +34.1% Of which fuel 1,686 +70.8% Of which staff 1,922 +17.8% Of which depreciation 545 -2.5% Result from equity investments -2
Slide 22: EBIT / Adjusted EBIT bridge Q1 2023
EBIT / Adjusted EBIT bridge Q1 2023 in EUR million 10 8 13 -273 -304 EBIT Impairment of non-current Book losses Exceptional M&A expenses Adjusted EBIT assets / assets held for sale Page 22
Slide 23: Adjusted EBIT / Net Income Q1 2023
Adjusted EBIT / Net Income Q1 2023 in EUR million -273 (31) (90) (2) 109 (136) (44) -467 Adjusted EBIT Adjustments Interest result Profit/loss Profit/loss from Tax result Other Net EBIT attributable to discontinued Income minority interests operations Page 23
Slide 24: Adjusted EBIT by Airline
Adjusted EBIT by Airline Adjusted EBIT (in EUR m) Q1 ’23 Q1 ’22 Change in % Lufthansa German Airlines -366 -715 +48.8% SWISS 77 -62 n.m.f. Austrian Airlines -73 -109 +33.0% Brussels Airlines -43 -62 +30.6% Eurowings -103 -163 +36.8% Passenger Airlines -512 -1,114 +54.0% Page 24
Slide 25: Cash flow statement
Cash flow statement Lufthansa Group (in m EUR) Q1 ’23 vs. Q1 ’221 EBT (earnings before income taxes) -575 +115 Positive working capital effect driven by Depreciation & amortization (incl. repairable MRO materials) +592 -24 EUR 2,070 million net cash effect from new bookings (New bookings EUR 2,314 m
Slide 26: Multi-year financial overview
Multi-year financial overview Lufthansa Group (in EUR million, as reported) 2016 2017 2018 20191 2020 2021 2022 Operating KPIs RASK ex currency -5.9% +1.9% -0.5% -2.5% -26.7% -6.1% -6.1% CASK ex currency, ex fuel2 -2.5% -1.8% -1.7% -1.5% +84.6% -25.8% -25.8% Profit & Loss Revenues 31,660 35,579 35,5
Slide 27: Maturity profile of borrowings as of March 31, 2023
Maturity profile of borrowings as of March 31, 2023 3,000 2,500 2,000 1,500 1,000 500 0 2023 2024 2025 2026 2027 2028 2029 2030 Straight Bond Hybrid Convertible Bond Schuldscheindarlehen Aircraft Finance (secured) Other* *Mainly bilateral loans – does not include operating leases Page 27