Lufthansa steps up restructuring | Calamatta Cuschieri

The Maltese market closed in the green on Tuesday, with the MSE total index ending the session 0.077% higher to 8,182.215 points. The best performer was PG plc with a 2.56% jump to close at 2.00, followed by a 1.71% and 1.53% rise of Malta International Airport plc and RS2 Software plc with a closing price 5.95 and 1.99 respectively. The biggest fall of 5% was seen from FIMBank plc, which closed at 0.38. Followed by a 1.67% drop of BMIT Technologies plc to close at 0.47.

European stocks extended their advance to near three-month highs with German issues leading the pack on the back of talk that a second round of stimulus spending was in the works. By the end of trading, the benchmark Stoxx 600 was ahead by 1.57% at 359.77, alongside a gain of 3.75% to 12,021.28 for the Dax in Frankfurt while Milan's FTSE Mibel added 2.42% to 18,971.09.

US stocks closed higher on Tuesday as market participants remained optimistic about the reopening of the US economy despite a wave of civil unrest spreading across the country. At the close, the Dow Jones Industrial Average was up 1.05% at 25,742.65 and the S&P 500 was 0.82% firmer at 3,080.82, while the Nasdaq Composite was 2.02% stronger at 9,608.37.

Lufthansa vows company revamp as losses balloon

Lufthansa vowed to step up restructuring measures after posting a first-quarter net loss of 2.1 billion euros ($2.35 billion), days after agreeing a state bail-out amid the fallout from the coronavirus pandemic.

The German carrier’s pledge to slash costs comes as it braces for a significant decline in 2020 earnings.

The first quarter loss, which compares to a net loss of 342 million euros in the year-earlier period, was driven by write-downs of 266 million euros on its fleet, as well as write-downs on the book value of catering business LSG North America by 100 million and on budget unit Eurowings by 57 million.

A slump in fuel hedging contracts was another 950 million euro burden on the bottom line.

Lufthansa, which had grounded almost all its aircraft at the height of the pandemic, confirmed a loss before interest and tax of 1.2 billion euros during the first three months of the year, first reported in April.

Lufthansa Group, which includes Swiss, Austrian Airlines and Brussels Airlines, suffered a 98% slump in April passenger numbers from the year-earlier month to 241,000.

This article was issued by Nadiia Grech, Junior Trader at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article are being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri Investment Services Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.