Quantcast
Transport Airlines

Lufthansa scraps dividend in order to have enough cash to buy planes

Skift Take

Lufthansa needs to be cautious about its spending, what with the threat of low-cost carriers in Europe and the threat of Turkish Airways and Gulf carriers encroaching on its turf.

— Jason Clampet

Deutsche Lufthansa AG, the German airline, said it plans to suspend its dividend payout to retain its reserves, as the company embarks on a fresh round of cost cuts and enlarges its short- and long-haul fleet of aircraft.

The company said it will buy 8 long-range and 100 short- to medium-range aircraft, in a purchase valued at about 9 billion euros, according to a statement today. At the same time, Lufthansa said it will close sites and merge administrative functions in a bid to save costs.

Lufthansa said profit last year reached 990 million euros, compared with a year-earlier loss of 13 million euros, mainly as it benefited from disposal gains. Revenue in 2012 rose to 30.1 billion euros from 28.7 billion euros, Deutsche Lufthansa said, citing preliminary earnings figures.

To contact the reporter on this story: Benedikt Kammel in Berlin at bkammel@bloomberg.net. To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net.

More Stories Below ▼
Daily Travel Startup Watch: Ascape, Rota and More
Free Report: What Millennials Want in Meetings
Daily Travel Startup Watch: Vagalife, Whoop and More
Video: How Amsterdam is Rethinking Urban User Experience to Build the City of the Future

Video: How Amsterdam is Rethinking Urban User Experience to Build the City of the Future

Marriott Removes Ad Making Fun of Travel Agents
The State of Travel Media 2015
Trend Report

The State of Travel Media 2015