Lufthansa Group says it
plans to sell off its AirPlus payment and LSG Group ground services
businesses “once the market environment
allows the fair value to be realised”. The group will also partially divest its
interest in the Lufthansa Technik maintenance business.
The AirPlus card was founded by eleven airlines in 1986 and invoice volumes through the payment system were €4.8 billion in 2020, down from a pre-pandemic €16.5 billion in 2019. The division has some 1,150 employees.
The group made the announcement as it gave an update of its current trading position. It said it expected to achieve gross savings of approximately €3.5 billion by 2024 (compared to 2019), of which around half are expected to be implemented by the end of 2021.
It forecasts savings on staff to be around €1.8 billion from 2023 onwards as a result of shedding some 26,000 employees since the start of the pandemic. The group received a €9 billion rescue package from the German government in 2020.
The company said that it is
starting to see positive signs in bookings which have “increased significantly as
the roll-out of vaccination programmes accelerates and with travel restrictions
being progressively eased globally”.
It said that bookings in
May and early-June were double the weekly levels experienced in March and April. The increase
in demand is largely from leisure-based destinations around the Mediterranean and
long-haul leisure markets where there are only limited or no travel
restrictions, it said.
Operating cash flow will be
positive in the second quarter of 2021 as a result, the company said, and projects
passenger numbers to reach around 30 per cent of pre-crisis levels in June, 45 per
cent in July and around 55 per cent in August.
The group said it was “further
adapting to different speeds of recovery in the travel sector by adjusting its
offering to an expected slower recovery in the corporate segment, compared to
strong pent-up leisure and visiting family and relatives demand”.
The group also projected
that direct distribution channels will account for more than 75 per cent of
bookings by 2024, up from 50 per cent in 2019.