Lufthansa Technik AG maintained its growth course in 2017. With a new revenue record and the best sales result in the company's history, investments were raised once again and the final result was a slight improvement over the previous year.
Year of sales
Sales revenue grew significantly, increasing by 260 million euros from the previous year's €5.144bn to €5.404bn (+5%). The company achieved an adjusted EBIT (Earnings Before Interest and Taxes) of 415 million euros (previous year: 411 million euros). These figures from Lufthansa Technik AG and 22 fully consolidated companies were presented at a press conference and the corporate headquarters in Hamburg today.
"Lufthansa Technik is and remains the leading provider in our industry," said the Chairman of the Executive Board of Lufthansa Technik AG, Dr. Johannes Bussmann. "The new contracts, with a total volume of more than 13 billion euros, provide impressive proof. Last year was the year of sales. Our team delivered a fantastic performance, demonstrating the importance of the internationalization approach adopted by Lufthansa Technik."
Constanze Hufenbecher, Chief Financial Officer of Lufthansa Technik, considers that the company is on the right path. "The compass is consistently pointing to growth. The number of aircraft under contract is increasing, profitability is consistently strong and the earnings develop pleasantly, especially in view of high level of investment, particularly in digitization." Basis of this positive development is the high level of investment activity: "Since 2014, we have almost doubled our annual investments to 233 million euros and we plan to pursue this approach further", said Constanze Hufenbecher.
In 2017, the number of aircraft under exclusive support contracts with Lufthansa Technik grew by a further ten percent to more than 4,550. This equates to around 20 percent of all commercial aircraft worldwide.
"A growing number of customers and supported aircraft, along with considerable new business, demonstrate the great trust that we enjoy in the aviation industry around the world," commented Dr. Johannes Bussmann.
Into the digital age with AVIATAR
In 2017, Lufthansa Technik laid the foundation for a portfolio of digital maintenance products with the establishment of its new "Digital Fleet Solutions" product division. The company presented AVIATAR, an integrated solution and an innovative platform whereby numerous apps, taken together, deliver a diverse and extensive range of digital maintenance, repair and overhaul (MRO) products and services. AVIATAR supports customers real-time and OEM-independent in the management of complex fleet operations and helps in failure forecasting for individual components.
Information is bundled and summarized at a single central point. With the help of analytical models, new insights, recommendations, and notifications are generated, equipping customers to make decisions more quickly and on a sounder basis.
"We have made a very ambitious entry into digitalization with AVIATAR. The expectations we are placing on ourselves here are very high, because we want to shape the digitalization of our industry with our modern fleet management solutions. With Wizz Air, we have already won an important AVIATAR partner with a large fleet from outside the Lufthansa Group," said Dr. Johannes Bussmann.
International growth continues
The expansion of the international presence of Lufthansa Technik continued last year. Particularly in the Engines division, key pillars for future development were put in place in 2017. The XEOS joint venture with GE Aviation, currently being established, has laid the foundation stone for the construction of a state-of-the-art maintenance facility for GEnx-2B and GE9X engines in Poland. A contract has been signed with MTU Aero Engines to establish a new joint venture, EME Aero, also to be based in Poland. This company will have a future workforce of around 800 personnel to provide maintenance services for the PW1000G series of turbofans.
In Asia, the Component Services Division and the Lufthansa Technik Component Services Asia Pacific subsidiary have further extended the company's presence in this important growth market. In Dubai, Lufthansa Technik Middle East is providing services for airframe-related components, AOG support, landing gear and engines.
Commitment to Germany
Considerable sums continue to be invested at sites in Germany, too. At the end of September, Lufthansa Technik opened a new wheels and brakes workshop at the Frankfurt Osthafen site. Built in just under two years, the industrial facility satisfies the most advanced of expectations and currently employs a workforce of around 200. Also Lufthansa Technik's site in Hamburg, where the corporate headquarters is based, has been modernized. Investments included, for example, a new Center of Excellence for Engine Casings and a new x-ray center. Lufthansa Technik has thereby taken important steps to introduce LEAP engine overhaul and to expand component repair services.
The company believes it is well prepared for the future. "Never before have we generated so much revenue, supported so many aircraft, or employed so many people. With this foundation, we will stick to our course: growing throughout the world and driving the entire industry forward," said CEO Dr. Johannes Bussmann of the outlook for the future.