Lufthansa expects further 'significant improvement' after return to profit

Germany's Lufthansa on Friday delivered an "unprecedented" turnaround as it swung to a E1.51b 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 Carsten Spohr said. "In just one year, we have achieved an unprecedented financial turnaround ... Demand for air travel remains high in 2023," he added. Shares jumped 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 E1.51b came after a loss of E1.6b a year ago. Q4 profit swung to E575m from a loss of E42m, in line with expectations. The balance sheet also improved, with net debt falling to E6.9b from E9b. However, operating profit was still 34% lower than the pre-pandemic 2019 level and passenger 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. Yields are, however, expected to stay about 20% above 2019 levels as higher costs 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. 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 remain in short supply.<br/>