Lufthansa Technik reports that it is heading for yet another record annual result this year. The global aircraft maintenance, repair and overhaul (MRO) company achieved a new Adjusted EBIT (Earnings Before Interest & Taxes) record of €554 million (US$559m) last year, and the company forecasts a higher figure for the full year 2023, having recently reported the best first half-year earnings in the company’s history.
“The aviation sector is recovering much faster than expected. This is benefiting us because we are succeeding in exploiting many of the resulting opportunities for us thanks to the great commitment of our employees,” said Dr William Willms, chief financial officer at Lufthansa Technik.
“Our components business in particular had a very strong summer. Material is in great demand on the market. We continue to attract customers through better material availability compared with competitors, among other things,” he added.
The bottom line for earnings after the third quarter of 2023 is now an Adjusted EBIT of € 459 million euros (+7%) despite headwinds from the dollar exchange rate and high inflation, while Lufthansa Technik’s revenue increased to € 4.8 billion (+20%). Lufthansa Technik also secured future business of the future: as of late September, the company had signed more than 580 new contracts during 2023, compared to around 700 during all of 2022.
Given this confidence, Lufthansa Technik is making investments in materials and personnel, with its employee number increasing to 22,290.
“We are in a position to finance all of this thanks to our good earnings,” stated Willms. “Obviously, managing the influx of such a high number of new employees is a strenuous task for many in the company, but these efforts will pay off for us.”
Investments in infrastructure are also being driven forward, with construction projects that were halted during the Covid crisis being resumed. One example is the construction of a new hydraulics workshop at the company’s Hamburg site, where Lufthansa Technik is investing a ‘mid-double-digit’ million sum. Compared with 2022, investments have almost doubled.
Lufthansa Technik is also building its digitisation efforts across all business units. The company has just announced the foundation of ViTech, a joint venture with CleverPine AD, a Bulgaria-based provider of software engineering services. ViTech will set up a product-oriented software engineering and data science centre that will develop digitisation solutions exclusively for Lufthansa Technik. Effective immediately, ViTech will hire 85 software engineers to work in Sofia.