Germany’s largest airline, Lufthansa, posted a net loss of $2.4 billion in the first quarter of 2020, “significantly impacted” by the COVID-19 pandemic. This compares to a net loss of $384 million over the same period last year.
The loss before interest and tax was $1.3 billion.
According to the airline, the loss was brought about by write-downs of $298 million on its decommissioned aircraft. It also wrote down $112 million on the book value of its catering unit LSG North America, and another $64 million on budget airline, Eurowings.
The airline recorded a 26% drop in passenger numbers in the first quarter compared to one year ago. April alone saw a 98% drop in those numbers compared to last year.
A statement from the airline shows that the group parked 700 of its 763 aircraft in April and May, with a forecast that 300 airplanes will remain parked in 2021, and 200 in 2022.
Last month, the airline received a $10.8 billion bailout from the German government. The bailout thus gives the government a 24% stake in the airline, which could rise to 25% plus one share in the event of a takeover attempt. Additionally, it gives the government two seats on its supervisory board and influences the block strategic decisions.
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Furthermore, the bailout obliges Lufthansa to transfer up to 24 take-off and landing slots at its hubs in Frankfurt and Munich, to its rivals.
The airline maintains that from mid-June, it will significantly expand its schedules to around 2,000 weekly connections to more than 130 destinations worldwide so as to make as many destinations accessible again for holidaymakers and business travelers.
Lufthansa is the flag carrier and largest German airline, which, when combined with its subsidiaries, is the second-largest airline in Europe in terms of passengers carried. Its subsidiary passenger airlines include Austrian Airlines, Swiss International Air Lines, Brussels Airlines, and Eurowings.
In total, the group has over 700 aircraft, making it one of the largest airline fleets in the world.
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