-
Lufthansa Technik reported an 11% increase in first half revenue to €4.4 billion, while its operating margin narrowed as cost pressures and market volatility weighed on profitability
-
Adjusted earnings before interest and taxes margin slipped to 7.1% from 7.8% a year earlier
-
Revenue from external customers jumped 21%, accounting for 78% of total revenue
-
The company cited the Middle East crisis, a weaker US dollar, supply chain disruptions, and material shortages as headwinds
-
Lufthansa Technik is expanding its global aircraft maintenance, repair, and overhaul network, including a new widebody maintenance facility in Clark, Philippines, expected to create about 1,200 jobs
-
The company also broke ground on a new production facility in Portugal and expanded its defense business
-
Lufthansa Technik expects full-year 2026 performance to exceed last year’s results
Lufthansa Technik posted an 11% increase in first-half revenue to €4.4 billion, while its operating margin narrowed as cost pressures and market volatility weighed on profitability despite sustained demand for aircraft maintenance, repair, and overhaul (MRO) services.
Adjusted earnings before interest and taxes (EBIT) rose 2% year-on-year to €315 million, while the Adjusted EBIT margin declined to 7.1% from 7.8% in the same period last year, the German firm reported.
The company said strong global demand for MRO services and its diversified business portfolio supported overall performance, while continued investments and new customer agreements strengthened its position as the world’s largest provider of technical aircraft services.
Business from external customers increased 21% and accounted for 78% of total revenue, up from 72% a year earlier.
Lufthansa Technik said second-quarter performance was affected by external factors, including the Middle East crisis, which reduced demand for certain maintenance services because of lower flight activity and deferred shop visits. Results were also impacted by the weaker US dollar, persistent material shortages, and delivery delays involving aircraft, engine, and component manufacturers and suppliers.
Despite headwinds, the company reported results slightly above last year attributed to new customer contracts, disciplined costs, and a one-time insurance payout.
“Demand for our services remains strong overall. At the same time, we are experiencing greater volatility in shop visits and less predictability than we did just a few years ago. This makes our close partnership with customers more important than ever. Through this customer focus and our ability to adapt quickly to changing conditions, Lufthansa Technik remains resilient and successful, even in a challenging market environment,” said Dr. Christian Leifeld, chief financial officer of Lufthansa Technik.
Global investments
The company continued expanding its global maintenance network during the period.
In Portugal, Lufthansa Technik broke ground on a new production facility in Santa Maria da Feira near Porto, where it will invest several hundred million euros to expand engine parts and aircraft component repair capacity. The facility is expected to create up to 700 skilled jobs.
In Asia, the company is expanding its presence with a new maintenance facility in Clark, Philippines, which will add capacity for widebody aircraft overhaul services and create about 1,200 jobs.
READ: Lufthansa Technik to build second base maintenance facility in PH
Lufthansa Technik PH inks lease deal for NAIA facility
Lufthansa Technik also expanded its defense business after securing support services for the Boeing P-8A Poseidon, adding technical support for maritime patrol aircraft and strengthening its position in the military MRO market.
“Our investments follow a clear objective: we want to grow profitably and create additional capacity where our customers will need it in the future. At the same time, we are continuing to advance our technological capabilities, whether in Europe, Asia, the Americas, or the growing defense sector,” Leifeld said.
The company also expanded customer partnerships, including an agreement to provide auxiliary power unit support for Air India’s Airbus A350 fleet, further strengthening its presence in one of the world’s fastest-growing aviation markets.
Outlook
Despite a more challenging operating environment, Lufthansa Technik said it expects full-year business performance to remain clearly above the prior year’s level, supported by sustained demand, long-term customer contracts, expansion of its global production network, and disciplined cost management.
The company employed 22,983 people worldwide as of the end of the first half.
“Especially in an environment characterized by strong demand, rising costs, and increasing market dynamics, we cannot focus solely on the present. The decisions we make today will determine our competitiveness tomorrow. That is why we continue to invest consistently in infrastructure, digitalization, sustainability, and talent. These investments create the foundation for long-term success and strengthen Lufthansa Technik’s resilience,” Leifeld said.
