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Lufthansa cash-positive this summer, rescue deal on track – CEO By Reuters

© Reuters. FILE PHOTO: CEO of Lufthansa, Carsten Spohr, delivers a speech during the opening ceremony of the new Berlin-Brandenburg Airport (BER) “Willy Brandt” in Schoenefeld, near Berlin, Germany October 31, 2020. Tobias Schwarz/Pool via REUTERS

(Corrects first and fourth paragraph to show Spohr spoke to journalists on Monday, not in an interview to Reuters on Tuesday. Also corrects to show cargo profit figure in last paragraph refers to H1 2021, not to last year.)

By Ilona Wissenbach

FRANKFURT (Reuters) – German airline Lufthansa will generate positive cash flow this summer, while it should be possible to fully unwind a COVID-19 rescue package in a year’s time, CEO Carsten Spohr said late on Monday.

Most Lufthansa flights were grounded by the coronavirus pandemic in early 2020, plunging the airline into crisis and leading the German government to acquire a 20% stake as part of a 6 billion euro ($7.1 billion) rescue package.

Germany’s economic stabilisation fund said last week it would start selling down its stake in the coming weeks with a view to disposing of it fully by the end of 2023.

“We are relieved that the government has entered the process of exiting,” Spohr told journalists, adding that he expected the rescue and stabilisation of the airline to be largely wrapped up next summer.

Cost savings mean Lufthansa can generate cash even with passenger numbers at half pre-pandemic levels – a level reached during the summer holiday season, said Spohr. For the year as a whole, Lufthansa can reach 40% of pre-crisis capacity.

Lufthansa’s cargo operation was performing strongly and is expected to generate profits of a billion euros this year, he added. That compares with air cargo profit of 640 million euros in the first half of this year.

($1 = 0.8455 euros)

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