Overall statement on opportunities and risks

The Lufthansa Group reported a continued recovery in demand for air travel in financial year 2024. The Lufthansa Group Passenger Airlines was able to increase its capacity and revenue further as a result. Higher demand also meant a stabilisation of earnings risks.

Decreasing yields, strikes, irregularities in flight operations, delays to the delivery of new aircraft and inefficiencies at Lufthansa Airlines all had an adverse impact, however, resulting in the Lufthansa Group’s earnings declining year-on-year. Further capacity expansion and a significant improvement in earnings is expected for 2025. Performance will depend largely on the effectiveness of the initiated measures and earnings improvement programmes, especially at Lufthansa Airlines.

The Lufthansa Group continued to strengthen its balance sheet in 2024 and liquidity improved. An additional instrument for forward-looking identification and management of liquidity risks is the continuous reporting of risk-bearing capacity.

On the other hand, geopolitical conflicts, resource and supply-chain bottlenecks and economic developments have caused certain risks to increase.

In this challenging environment, the Lufthansa Group continues to rely on its ability to adjust its capacities and resources flexibly to changing market conditions and to use this flexibility to seize opportunities for the Company’s long-term development.

The Executive Board of Deutsche Lufthansa AG is not aware of any material or systemic matters that are inconsistent with the suitability and effectiveness of risk management as a whole. However, it must be remembered that, irrespective of the design, risk management cannot provide absolute assurance. The Executive Board continues to strive for a balance between opportunities and risks.