# Lufthansa expects further ‘significant improvement’ after return to profit Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2023-03-03 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Germany's Lufthansa Achieves Unprecedented Financial Turnaround in 2022 Meta Description: Lufthansa's 2022 profit of 1.51 billion euros signals a major shift, with expectations of increased earnings in 2023. CEO optimistic about air travel URL: https://financedigest.com/lufthansa-expects-further-significant-improvement-after-return-to-profithtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2023-03-03t100034z1lynxmpej220bkrtroptp4lufthansa-results-1736814384967-compressed.jpg) By Ilona Wissenbach and Joanna Plucinska (Reuters) – Germany’s Lufthansa on Friday delivered an “unprecedented” turnaround as it swung to a 1.51 billion euro profit in 2022 and expects a significant improvement in earnings this year, pushing its shares up to a three-year high as air travel rebounds. Passenger numbers more than doubled and net revenue almost doubled from 2021, although the figures remain short of pre-pandemic levels. Lufthansa is [back,” CEO](https://www.financedigest.com/shareholder-group-iss-backs-barclays-board-over-former-ceo-staley.html "Shareholder group ISS backs Barclays board over former CEO Staley") Carsten Spohr said in a statement. In just one year, we have [achieved an unprecedented financial](https://www.financedigest.com/achieve-shorter-financial-close.html "How to Achieve a Shorter Financial Close") turnaround … [Demand for air travel](https://www.financedigest.com/delta-sees-return-to-profit-as-travel-demand-hits-historic-levels.html "Delta sees return to profit as travel demand hits ‘historic’ levels") remains high in 2023,” he added. [Shares jumped](https://www.financedigest.com/orpea-shares-jump-on-q4-revenue-and-cash-boost.html "Orpea shares jump on Q4 revenue and cash boost") to a three-year high, gaining more than 5% on Friday, having climbed more than 30% in value since December last year. The company’s full-year operating [profit of 1.51 billion euros](https://www.financedigest.com/hellofresh-sees-2023-core-profit-of-460-540-million-euros.html "HelloFresh sees 2023 core profit of 460-540 million euros") ($1.60 billion) came after a loss of 1.6 billion euros a year ago. Fourth-quarter profit swung to 575 million [euros](https://www.financedigest.com/germanys-merck-to-invest-300-million-euros-in-us-gas-plant.html "Germany’s Merck to invest 300 million euros in US gas plant") from a loss of 42 million euros, in line with expectations. The balance sheet also improved, with net debt [falling to 6.9 billion euros](https://www.financedigest.com/big-fall-in-euro-zone-inflation-offers-little-help-for-ecb.html "Big fall in euro zone inflation offers little help for ECB") from 9 billion euros. However, operating profit was still 34% lower than the [pre-pandemic 2019 level and passenger](https://www.financedigest.com/fraport-sees-2023-passenger-traffic-at-80-90-of-pre-pandemic-levels.html "Fraport sees 2023 passenger traffic at 80-90% of pre-pandemic levels") numbers had only recovered 72%. Like others in the industry, Lufthansa is also grappling with high cost [inflation as well as a surge in fuel prices](https://www.financedigest.com/uk-shop-price-inflation-hits-record-8-in-january-brc.html "UK shop price inflation hits record 8% in January: BRC"). Yields are, however, [expected to stay about 20% above 2019 levels as higher costs](https://www.financedigest.com/five-cost-of-living-trends-expected-in-2023.html "Five cost of living trends expected in 2023") are passed on to passengers, a Lufthansa representative said on a media call. The company said it [expects “further significant improvement” in operating profit this year](https://www.financedigest.com/philips-expects-to-reach-recall-settlements-this-year.html "Philips expects to reach recall settlements this year"). After cancelling many flights last year, the company is trying to avert travel chaos this summer by scrapping some scheduled flights as [airport and technical staff](https://www.financedigest.com/uk-airports-face-christmas-disruption-as-border-staff-to-strike.html "UK airports face Christmas disruption as border staff to strike") remain in short supply. Spohr told a [press conference](https://www.financedigest.com/5-top-tips-when-holding-a-crisis-press-conference.html "5 Top Tips When Holding a Crisis Press Conference") the possibility of further cancellations would depend on airports rather than airlines but there was a risk that capacity could be limited due to high demand. Germany’s Verdi Union, which recently planned strikes impacting airports and flights, said Lufthansa’s return to profit meant it needed to negotiate a better [deal with employees](https://www.financedigest.com/how-to-deal-with-challenging-employees.html "How to Deal With Challenging Employees?"). The Executive [Board must now win back](https://www.financedigest.com/institutional-investors-back-shell-board-lawsuit-over-climate-risk.html "Institutional investors back Shell board lawsuit over climate risk") the trust of employees,” Marvin Reschinsky, Verdi group manager for Lufthansa, said, as the union pushes for all staff to receive a bonus of 3,000 euros. Spohr said Lufthansa had already negotiated a permanent [pay rise](https://www.financedigest.com/unicredit-shareholders-urged-to-reject-ceo-orcels-pay-rise.html "UniCredit shareholders urged to reject CEO Orcel’s pay rise") for employees above inflation. ($1 = 0.9418 euros) (Reporting by Anna Mackenzie and Anastasiia Kozlova in Gdansk, Ilona Wissenbach in Frankfurt, Writing by Joanna Plucinska in London; Editing by Edwina Gibbs, Elaine Hardcastle) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---