Revenue rises nearly 10 percent - a company record
- For the first time, more than 5,000 aircraft under contract
- Investments in digitalization, network and personnel
Lufthansa Technik AG continued on its course for growth in 2018. With
revenue at record levels, the company slightly surpassed its results
from 2017 despite intensified price pressure and far-reaching
investments in digitalization, its international network and
personnel.
Sales revenues climbed by more than EUR 500 million, surging from EUR
5.404 billion to EUR 5.918 billion, an increase of 9.5 percent above
the previous year's total. The company generated adjusted EBIT of EUR
425 million (previous year: EUR 415 million), an increase of 2
percent. These figures apply to Lufthansa Technik AG and its 21 fully
consolidated companies.
Bussmann: "We are the driving force in our industry"
Lufthansa Technik thus outperformed the market in 2018. The Americas
region produced the highest level of growth with a 20 percent
increase in revenue year on year, ahead of the region Europe, Middle
East and Africa with a gain of nearly 9 percent. Asia generated
modest revenue growth of 3.4 percent.
"Growth of 10 percent, a level that clearly outpaced the market, is a
strong performance. We have every right to be satisfied, because we
have demonstrated once again that we are the driving force in our
industry," said Dr. Johannes Bussmann, the Chairman and CEO of
Lufthansa Technik AG.
The important role played by Lufthansa Technik in international
aviation is reflected in particular in the number of aircraft the
company supports: For the first time, Lufthansa Technik now provides
technical services for more than 5,000 aircraft. This figure grew in
2018 by about 600 to a total of 5,131 aircraft, an increase of nearly
13 percent, and amounts to about one-fifth of the commercial aircraft
in operation around the world today.
"Every fifth aircraft that takes off and lands around the world is
supported by Lufthansa Technik," Bussmann said. "This says more about
our success than any key performance indicator, and it especially
reflects the growing trust of our customers in the excellence of our
workforce. Those are very solid prerequisites for further growth this
year."
The company's strong performance was also mirrored by new contracts:
During fiscal year 2018, Lufthansa Technik gained 29 additional
aircraft operators as customers and signed 576 contracts for new
business worth EUR 5 billion.
Investments in digitalization, network and personnel
The aircraft maintenance, repair and overhaul (MRO) industry is
undergoing a very dynamic transformation process: Business conditions
are changing even as the market is set to grow steadily at an
expected rate of at least 5 percent annually. More and more new
aircraft types with new technologies, materials, components and
engines are entering flight operations as part of a process that is
unlike anything seen in decades. At the same time, new actors - the
manufacturers of aircraft and components - are joining the growing
MRO market.
"The market is both extremely attractive and challenging. For us as
the world market leader, this means continuing to develop and, of
course, continuing to invest," Bussmann noted.
For this reason, Lufthansa Technik boosted its investments once again
last year, from EUR 233 million to EUR 241 million. The focal points
of these investments were the development of digital products and
services, the expansion of the company's international production
network, partnerships with manufacturers, particularly in the area of
engine overhaul, and the hiring of new employees.
The focus of the company's business development is the digitalization
of the service range: AVIATAR, an independent and integrated platform
for digital services, has established itself in the marketplace. Many
partners and customers from major airline alliances are already
working with AVIATAR. Thus, the operators of a significant four-digit
number of aircraft meanwhile supported on the platform profit from
optimized operating times, reduced consequential costs and more
reliable fleet operations. The services offered by AVIATAR include
predictive maintenance with integrated technical implementation.
Flight operations will be added in the next step as a way of
providing airlines with an end-to-end, uniform solution for fleet
management, from technical operations ("tech-ops") and ground
operations ("ground-ops") to flight operations ("flight-ops"). To
ensure competition and guarantee airlines' independence in regard to
their data in the long-term, Lufthansa Technik has set up the
AVIATION DataHub in March 2019. The stand-alone company offers an
independent platform for all data generated by aviation.
"We are the only company in the world that offers an integrated and
manufacturer-independent digital platform like AVIATAR, where we can
pool our decades of experience in the maintenance of aircraft,
components and engines," Bussmann explained. "The establishment of
the AVIATION DataHub is another very important step to ensuring this
independence and guaranteeing airlines' control of the data of their
fleets and the use of this information."
In the area of engine maintenance, Lufthansa Technik moved ahead in
2018 with efforts to forge joint ventures with engine manufacturers.
XEOS, a joint production platform with GE Aviation, celebrated its
topping-out ceremony in 2018. Beginning in the spring of 2019, it
will maintain, repair and overhaul the first large-sized engines from
the latest generation of General Electric engines on behalf of their
owners. EME Aero, a joint venture with MTU Aero Engines, laid the
cornerstone last year for the construction of one of the largest and
most modern MRO shops for state-of-the-art geared turbofan engines.
This facility is scheduled to go into operation at the end of 2019.
Investments in digitalization and the network were supported in 2018
by a substantial increase in the size of the company's workforce. The
headcount of Lufthansa Technik AG and its 21 fully consolidated
companies rose by an average of 6 percent during the year, from
21,194 (2017) to 22,537 (2018).
One critically important element of personnel development is the
professional training of young people. Across Germany, 122 young
employees began their training in 2018 in technical, industrial or
commercial areas at the Lufthansa Technik Group. This number will
rise to more than 200 on 1 August 2019, when the next training period
begins.