Lufthansa slashes flight schedule further, may seek state aid

BERLIN (Reuters) - German flagship carrier Lufthansa LHAG.DE on Friday said it would scrap its annual dividend, slash its flight schedule further and is also considering a request for state aid to help it deal with the impact of the coronavirus outbreak.

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“Over the next few weeks, the flight schedule may be reduced further by up to 70 percent compared to the original plan,” the airline said, adding that it would propose to shareholders not to pay a dividend for the 2019 business year to safeguard its liquidity.

The airline group, which also owns Swiss International, Austrian Airlines and Brussels Airlines, earlier said it was speaking to governments of countries where its units are based about possible state support.

“We have decided to speak to the governments of our home countries not only about easing burdens as before but also about active support when this becomes necessary,” Chief Executive Carsten Spohr said in a video message to staff seen by Reuters.

Other airlines on Friday said they depended on help. British Airways told staff its survival was at stake while low-cost carrier Norwegian Air Shuttle NWC.OL warned of its possible collapse without further state aid.

Following President Donald Trump’s announcement on Wednesday of curbs on flights to the United States from much of continental Europe, a Lufthansa spokesman said on Friday that U.S. flights would be reduced by 80%.

The group also said 2019 adjusted earnings before interest and tax fell to 2.03 billion euros from 2.8 billion a year earlier. The figure for this year would be significantly lower, it added.

Newspaper Handelsblatt earlier reported the airline would petition for state aid.

The company said it had raised 600 million euros in additional funding in recent weeks, bringing its liquidity buffer to 4.3 billion euros.

Unutilised credit lines were at 800 million euros and additional funds were currently being raised, it added.

Reporting by Klaus Lauer in Berlin; additional reporting by Ilona Wissenbach in Frankfurt; writing by Ludwig Burger; editing by Thomas Seythal, Thomas Escritt and Leslie Adler