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Sun 1 Apr 2007 03:31 PM

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Lufthansa Technik capitalises on MRO boom

Lufthansa Technik Group has reported significant increases in revenue during 2006, following the international growth of the maintenance, repair and overhaul (MRO) market.

Lufthansa Technik Group has reported significant increases in revenue during 2006, following the international growth of the maintenance, repair and overhaul (MRO) market.

The company's revenues reached an impressive US$4.5 billion last year, marking an increase of 9.4%. Its pre-tax earnings also experienced a generous climb, increasing by 8% to reach $325 million.

"A contributing factor to the improvement in earnings was the continuation of our strict cost control and capacity management programme," explained Dr Peter Jansen, chief finance executive, Lufthansa Technik.

"We have further improved our cost situation, our efficiency, our productivity and our work processes. This meant we were able to achieve long-term savings amounting to $325 million, which slightly exceeded our target for 2006," he added.

Lufthansa Technik also attracted an increasing percentage of business from external customers in 2006, outperforming the general MRO market. "We experienced 12.5% increases in revenue from external customers, which allowed us to grow more rapidly than the international market, which showed 7% growth," said Jansen.

Lufthansa will be focusing on reducing operating expenses to maintain further profit increases. The company experienced an increase of 8.5% in operating expenses during 2006.

"Airlines are being compelled to reduce costs further and increase productivity. The effort of these measures is being passed onto suppliers, including MRO companies. The objective is creating an ideal balance between successful cost management and high quality standards," he said.

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