Market conditions have been consistently challenging in recent years. Numerous crises, resulting from natural disasters, political unrest or economic and financial turmoil, and the accompanying fluctuations in demand have forced our business segments to keep adapting to new market conditions. Lufthansa has nevertheless been able to achieve positive medium and long-term development. The flexible capacity management of our airborne segments plays a vital role in this. At the same time, the continuous optimisation of our cost structures makes it possible for us to compensate for price increases in expense items that are largely beyond our influence, such as fuel, fees and charges, or air traffic taxes. In the last two years alone, the Lufthansa Group had to absorb nearly EUR 3bn in additional fuel costs and still managed to achieve considerable operating profits in this period. For each segment, flexible cost structures and improvements to income structures are top priorities in their striving for sustainable, profitable growth.
The measures being used are supplemented as necessary by other cost management initiatives and structural alterations to secure competitiveness. Details on the activities carried out in the business segments – such as the initiative at Lufthansa Passenger Airlines that has been brought to a successful conclusion – can be found in the comments on the . In parallel with the ongoing optimisation in the individual companies we generate cross-company and cross-segment earnings contributions by realising synergies.
This entails pooling competences in the Group and exchanging best practices among the separate companies in order to keep improving the results in the future.
We are always looking for opportunities to improve our cost structures and we take further steps to increase efficiency, such as the introduction of lean management methods and concepts, which are now applied in broad areas of the Group. At the beginning of 2012 we launched the Group-wide structural earnings improvement programme SCORE in order to achieve lasting improvements in our operating margin. Over the course of the three-year programme earnings improvements of at least EUR 1.5bn are to be generated. It is an expression of and at the same time a requirement for our goal of achieving sustainable profitable growth in a capital-intensive business. In comparison with other network carriers in Europe this means Lufthansa continues to stand for solid profitability and sustainable value creation.