21.03.2016

Lufthansa Technik increases turnover and profit significantly in 2015

Growth course continues

Lufthansa Technik AG, headquartered in Hamburg, significantly increased its turnover and profit in 2015, continuing its growth course. Sales revenues grew by 17.6 per cent to around 5.1 billion euros (+762 million euros). The company achieved 20 percent growth in its adjusted EBIT (Earnings Before Interest and Taxes) to 454 million euros (previous year: 380 million euros). This is revealed in the consolidated annual report, released today, for Lufthansa Technik AG and 22 holdings.

"This is a strong result," said the Chairman of the Executive Board at Lufthansa Technik AG, Dr. Johannes Bussmann, at the presentation of the annual results in Hamburg. "We have stayed on our growth path and have used the year to more strongly position ourselves internationally and within the regional market. Our customers have honored these efforts!"

Business with customers outside the Lufthansa Group grew disproportionately. External revenue from outside the Group grew by 21.8 percent to 3.3 billion euros. Revenue from companies within the Group rose over the previous year to 1.8 billion euros (+179 million euros), essentially as a result of the largest modification program in Lufthansa's history. Revenue development was further aided by the US dollar exchange rate.

"Lufthansa Technik has a solid financial foundation. But we have benefited as well from effects which were out of our control, such as the dollar rate. It will therefore be a challenge to continue delivering such results," commented Constanze Hufenbecher, Chief Financial Officer at Lufthansa Technik.

In 2015, Lufthansa Technik AG acquired 27 new customers (bringing the total to around 800) and concluded 375 new contracts with a total volume within the company itself (excluding subsidiaries) of 3.1 billion euros for 2015 and the following years. The number of aircraft supported by Lufthansa Technik rose by twelve percent to around 3,700.

Important contracts cover new aircraft such as the Airbus A350 and the Boeing 787. Comprehensive new component services contracts, for example, have been signed with Finnair, the first European operator of the new Airbus A350, and Air Europa Lineas Aéreas for its Boeing 787 fleet.

"We support all of the world's modern airliners, including the A320neo. With this technical expertise, we are outstandingly well prepared for further growth," continued Bussmann.

With the opening of a new overseas location in July 2015, in Puerto Rico, Lufthansa Technik now has its own overhaul site in the important American market. The opening of the first two of five planned overhaul lines at Lufthansa Technik Puerto Rico was an important step in the company's ongoing internationalization. In Asia, Lufthansa Technik Philippines brought additional hangar space for the overhaul of Airbus A380 and Boeing 777 aircraft online. Construction work has also begun for a new wheels and brakes workshop in Frankfurt, representing an investment of around 60 million euros in this German site.

"The market is growing – especially in Asia and South America. And our customers expect us to be close to them. We will therefore continue to further expand our international presence, so as to take advantage of the expected growth in international aviation," said Johannes Bussmann.

The market for maintenance and servicing in aviation will grow further, but it is also going to change significantly. "We are seeing a powerful dynamic in the aviation industry. At the current time, more new aircraft models with new technologies, materials, components, and engines are entering operation than has been the case for decades. At the same time, new competitors are aggressively entering the market," continued Bussmann.

"This dynamic is a great opportunity for us, but it also demands a considerable willingness to change if we are to remain on a profitable growth path," emphasized Constanze Hufenbecher. For 2016, the company expects turnover growth accompanied by a significant decline in profit.

The company therefore invested a significant amount of money in development last year. Major areas of focus are innovation and product development, including new technologies, mastering new materials, and the automation of repair processes. Digitalization is a defining trend, set to bring massive changes to the industry in the coming years.

"Lufthansa Technik can and must be at the forefront of this. That is why we are investing many millions of euros in development and research – right here at our Hamburg site," emphasized Bussmann.