Lufthansa To Suspend Dividends, Close Sites

Deutsche Lufthansa AG (ETR:LHA) (PINK:DLAKY) (FRA:LHA) has just announced plans to shut down some sites, merge administrative functions and possibly even suspend dividend payments. Meanwhile, it also plans to place a hefty order for some new aircrafts.

Lufthansa To Suspend Dividends, Close Sites

The airline has been embroiled in cabin crew strikes for more than a year. The airline’s security staff has also been disrupting flights in Germany with a separate strike since last month as well.

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A statement from Deutsche Lufthansa indicates that the company’s executive board is suggesting to its supervisory board that the dividend payment be suspended. The statement said that the company’s “net profit is to be fully retained.”

Deutsche Lufthansa AG (ETR:LHA) (PINK:DLAKY) (FRA:LHA)’s  executive board is also proposing that the company place orders for “eight long-haul aircraft and 100 short- and medium-haul aircraft” with deliveries planned for between 2015 and 2025. The company said the total volume of those orders would be around €9 billion.

The company said its preliminary consolidated financial statements show that it has generated €30.1 in revenue during 2012, compared to €28.7 billion the year before. The company’s net profits for the year rose to €990 million from a loss of €13 million, mostly because of “non-recurring effects from the sale of equity investments.”

The company’s operating profit was €524 million, compared to €820 million the year before. The company said this includes the cost of restructuring its SCORE program. Deutsche Lufthansa AG (ETR:LHA) (PINK:DLAKY) (FRA:LHA) also said the partial transfer of the flight operations of Austrian Airlines over to Tyrolean Airways “had a one-time positive effect” of €115 million on the company’s operating results.