We reached important goals through planning and flexibility

The targets for the 2011 financial year that we published a year ago, see the chapter “Forecast” of the annual report 2010, were defined at a time when expectations of global economic developments were very different to what actually happened. Nonetheless, we had already prepared ourselves for the permanent state of uncertainty and the vulnerability of the airline industry to fluctuations in the operating environment.

Indeed, the business did not develop as expected over the course of 2011. Right at the beginning of the year the unrest in some Arab countries and the catastrophes in Japan had an impact which could not have been foreseen in advance. From the middle of the year the worsening euro crisis provided the backdrop for a sharp downturn in economic growth. In contrast, the oil price remained at a high level. This had a severe effect on the entire air traffic sector. Thanks to our solid positioning, our operating and financial flexibility and established risk management, the Lufthansa Group was able to respond swiftly to these developments, however, and therefore came through much better than most competitors in the industry. All in all, the course of business in the 2011 financial year was therefore satisfactory. The Executive Board thanks all the managers and employees in the Group, without whose commitment this result would not have been possible under the prevailing conditions.

Under these circumstances we were able to meet many, although not all, of our targets. The effects of our actions nevertheless confirm us in our course and encourage us to make good the shortfall. The following table gives an overview of the achievement of our targets. The respective chapters deal with individual aspects in more detail.




Target achievement 2011

Further revenue growth


EUR 28.7bn in revenue (+8.6 per cent)

Increase of the operating result


EUR 820m operating profit (–19.6 per cent)

Efficiency gains in all business segments


All the business segments are profitable and we have disposed of main ­loss-makers

Maintain minimum liquidity of EUR 2.3bn


Liquidity of EUR 4.1bn

Keep a high proportion of unencumbered aircraft


73 per cent of the Group fleet is ­unencumbered (81 per cent of the core Lufthansa Passenger Airlines and Lufthansa Cargo fleet)

Move closer to an equity ratio of 30 per cent


28.6 per cent equity ratio
(+0.2 percentage points)

Keep gearing in the target corridor
of 40 to 60 per cent


Gearing: 55.9 per cent
(+5.9 percentage points)

Reach a debt repayment ratio
of at least 60 per cent


Debt repayment ratio: 49.7 per cent
(–10.0 percentage points)

Meet the conditions for distributing a dividend


EUR 0.25 dividend proposal;
dividend policy conditions were only partly met

Generate free cash flow despite ongoing fleet renewal programme


EUR 713m free cash flow and EUR 2.6bn gross capital expenditure

Improve credit rating


Ratings confirmed:
BBB–, outlook stable (S&P’s);
Ba1, outlook stable (Moody’s)

Sustainable value creation (positive CVA)
over the cycle


EUR 2.3bn CVA since 2002
including EUR 99m CVA in 2011

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