The Lufthansa Group announced last week that it had repaid
or cancelled all remaining aid received by the German government during the
coronavirus pandemic “much earlier than originally planned”.
Lufthansa said the early repayment was made possible by
rapidly rising demand for travel, the fast restructuring and transformation of
the group and market confidence in the company.
The German government’s Economic Stabilization Fund (ESF) initially
provided measures and loans totalling up to €9 billion, of which Lufthansa said
it drew down a total of €3.8 billion, including €306 million with which the ESF
built up its shareholding in the group.
According to Lufthansa, it repaid €1.5 billion in October
this year, as well as a €1 billion loan in February. The final €1 billion was returned
on 12 November.
The settlement means the ESF must sell its 14 per cent stake
in the group’s shares by October 2023 “at the latest”, as required by the terms
of the funding.
Lufthansa Group CEO Carsten Spohr said the government’s
support had allowed the company to save 100,000 jobs during the pandemic, which
he called “the most serious financial crisis in our company’s history”.
“Lufthansa was able to rely on Germany and Germany can rely
on Lufthansa,” Spohr said in a statement. “Many challenges remain. Our ambition
is to strengthen our position among the world’s leading airline groups. To this
end, we will consistently continue the restructuring and transformation of the
company.”
As part of its restructuring, the group reduced its
headcount by 20 per cent in 2020 and expected to reduce this further to around 100,000
jobs. The company is also planning to begin an asset reduction programme with
the sale of its AirPlus payment and LSG Group ground services divisions “once
the market environment allows the fair value to be realised”.
In October, Lufthansa Group completed a capital increase of €2.2
billion, which it used to repay the government aid, and this month it
issued a bond amounting to €1.5 billion.
Earlier this month, the group reported €3.9 billion in
traffic revenue for the third quarter on the back of a “significant” increase
in demand, particularly in the business travel segment.