Lufthansa posts record annual loss, sees long recovery

Europe's biggest airline said it expects to book an operating loss again in 2021, although smaller than last year, as capacity runs at only 40-50 percent of pre-pandemic levels for the full year. 

Underlining the long road to recovery, it added that capacity will climb to 90 percent of 2019's level only in "the middle of the decade".

After borders slammed shut as governments scrambled to halt the first wave of the Covid-19 crisis, the airline faced an uncertain future.

In June, it was offered a lifeline by the German government, which pumped in nine billion euros for a 25 percent stake.

"The past year was the most challenging in the history of our company -- for our customers, our employees and our shareholders," said Lufthansa chief executive Carsten Spohr.

In the airline's home base, demand is sluggish with work from home orders curtailing lucrative business travel while official warnings are in place against leisure tourism in many countries worldwide.

Across Europe, restrictions are also in place as governments continue to battle rising infection numbers.

Lufthansa is currently flying about 20 percent of its capacity, with little improvement expected in the next one to two months.

But it expects demand to pick up again in the summer with a vaccination rollout progressing and more capacity for tests available.

Lufthansa, which includes subsidiaries Swiss, Austrian, Brussels Airlines and Eurowings, operated only 31 percent of its overall capacity last year.

Revenues sank 63 percent to 13.6 billion euros for 2020, compared to 36.4 billion euros in 2019.

The operating loss came in at 5.5 billion euros, while a year ago, the airline's comparative adjusted earnings before interest and tax stood in the black at 2.0 billion euros.

The International Air Transport Association now estimates that traffic will reach between 33 and 38 percent of the levels recorded in 2019.

Its previous 2021 forecast was for traffic to reach 51 percent of the levels seen before the coronavirus pandemic struck.