The Lufthansa Group increased its offer and sales during the past business year. The Group
was able to almost reproduce its previous year’s result by posting operating profit of around
1.35 billion euros. The Group profit was posted at 599 million euros; Last year’s figure had
been 1.66 billion euros, however, it had also included 585 million euros of profit from
extraordinary items. “This represents an outstanding result and its quality is underlined by the
fact that it has been achieved during a time of global economic crisis. It reflects the quality of
our company. A company in which a strong team, strong products and a strong balance were
decisive in ensuring success. We intend to maintain our lead in the far more challenging
environment of 2009. Our financial and operational flexibility will allow us to benefit from the
opportunities that come our way during the crisis”, commented Lufthansa Chairman and CEO
Wolfgang Mayrhuber, speaking at the presentation of the annual result for 2008. In view of the
very good result and taking into consideration the current challenging economic situation, the
Supervisory Board and Executive Board will be proposing a dividend of 70 eurocent per share
at the annual general meeting.
Whereas the worldwide economic slowdown has particularly been felt in the Passenger and
Catering business segments, the operating results of the remaining business segments
developed positively. In the Passenger Business segment, fuel costs at record levels,
strike-related losses and the decline in demand caused by the state of the world economy
during the second half of the year, all had a negative effect on the result. However, the
attractive premium products, a demand-oriented offer strategy and the successful integration
of SWISS all played decisive roles in ensuring a year-on-year growth in sales. “Crises also
always seem to have a repositioning aspect to them and we will be sure to secure the right
position for the future. We will be cost-effective, improve efficiency even further and take
important steps in the planned expansion of our airline group, in order to ensure the long-term
consolidation of our market position and that of our partners”, added the Lufthansa Chairman
and CEO. Speaking on the initiated mergers with Austrian Airlines and Brussels Airlines,
Mayrhuber underlined that it was important that no obstacles be placed in the way of
integration: “Swift and uncomplicated implementation remains the most essential requirement
to ensure the future survival of Europe as a successful centre of aviation in the face of global
competition. The current economic crisis painfully reveals the structural deficits in European
aviation. It has become obvious that European and intercontinental network connections from
smaller and medium-sized markets can no longer be realized. Only a strong and economically
successful European airline structure can meet the specific requirements of the European economy and provide its centres of business with a sustainable quality of global connections,
thus also providing employees with long-term perspectives.” 
The Logistics business segment achieved a significantly improved operating result during the
past year. In the MRO business segment, LHT extended its advantage as the leading provider
of maintenance, repair and overhaul services for civilian aircraft and recorded a year-on-year
rise in its operating result. The IT Services business segment was able to profit from targeted
measures aimed at improving productivity and achieved a significantly improved operating
result. Despite the introduction of cost reducing and productivity improving measures, the
operating result of the Catering business segment was below the figure of the previous year. 
Lufthansa well-equipped to face challenging times

One of the most challenging years in its history lies ahead of the aviation industry said the
Lufthansa Chairman and CEO looking ahead to 2009. It is not possible to forecast the duration
and extent of the economic crisis. “Lufthansa stands for reliability and foresight. We cannot
and will not rest on the laurels of last year’s result in this highly challenging economic
environment. Lufthansa will continue to keep an eye on a solid balance sheet and maintain its
financial and operational flexibility. We will continue to adjust our offer to the current demand
situation. The prerequisite for success is that all of the employee groups and business
segments, thus the entire Lufthansa family, work together through the crisis. Only in this way,
will we be able to seize the opportunity to remain profitable and powerful in the crisis, and
preserve and increase the attractiveness of our company. We intend to continue investing in
aircraft, products and training. We want to secure jobs and offer perspectives; and we want to
make dividends possible.” Lufthansa therefore introduced measures to secure the result at an
early stage and shall continue to implement strict cost management and demand-oriented
capacity management. However, in view of the dramatically deteriorating framework
conditions, the further development of business is associated with significantly higher risks
than usual. The Executive Board therefore expects a distinctively positive result for the 2009
business year; however, one that will be clearly below the previous year’s result. 

Annual figures 2008

During the year 2008, the Lufthansa Group generated revenues totalling 24.9 billion euros, a
year-on-year increase of 10.9 per cent. The traffic revenue rose by 13.8 per cent to 20 billion
euros. Besides the full consolidation of SWISS in the first half of 2008, this was mainly due to
the increased passenger figures with currency adjusted higher average revenues in the
Passenger Transportation business segment. During the reporting period, the Group’s
operating income increased by altogether 12.1 per cent to 27 billion euros.  Operating expenses rose to 25.6 billion euros during the past year, mainly as a result of the
rise in fuel costs to 5.4 billion euros. This was equivalent to an increase of 39.3 per cent. This
increase was due to price and quantity-related factors, as well as the change in the scope of
consolidation with the full consolidation of SWISS in the first half of 2008.

The Group recorded an operating result of 1.35 billion euros in 2008, 24 million euros less in
comparison with the record figure in 2007. The decline can mainly be attributed to the negative
developments in the Passenger Transportation business segment. The Group posted a result
of 599 million euros. Last year this figure was at 1.7 billion euros, however, it included 503
million euros of profit from the sale of the shares in Thomas Cook, as well as book gains of 82
million euros from the repurchase of own stock by WAM Acquisition S.A. 

Lufthansa’s capital expenditure during the reporting period totalled 2.2 billion euros, of which
1.3 billion euros were spent on the expansion and modernization of the fleet and 214 million
euros were spent on the acquisition of a minority stake in the JetBlue Airways Corporation on
22 January 2008. Operating cash flow totalled 2.5 billion euros. At the close of the final
quarter, the Group’s net liquid assets stood at 125 million euros. 

 

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