Lufthansa Systems restructures to face difficult trading conditions

Of this, revenues with external customers amounted to EUR 232 million (-4.9 percent). There was a slight increase in revenues with Lufthansa Group companies to EUR 363 million (+0.6 percent), which is primarily due to consolidation effects. The operating result decreased by 37.5 percent to EUR 10 million. Lufthansa Systems employed an average of 2,974 employees (-2.2 percent) in the past year.
"Given our customers' reluctance to make investments, we can be satisfied with this result," commented Stefan Hansen, CEO of Lufthansa Systems AG. "Yet it also documents the fact that we must take strong measures to ensure that Lufthansa Systems can continue to develop and safeguard its leading position in the market."
In response to increasing consolidation in the IT industry and growing competitive pressure, Lufthansa Systems has initiated a program to realign the company. Titled "Jetzt!" ("Now!"), the program aims to cut costs by EUR 25 million and generate an equal amount of additional revenues by June 30, 2011.
"Our products contributed to making many of our customers stronger and more competitive than before the economic crisis. By realigning Lufthansa Systems, we want to further improve our ability to support our customers in dealing with the challenges of their markets," said Hansen.
Lufthansa Systems’ revenues will continue to decline in 2011 as the company migrates to new technologies which are more cost-efficient for its customers. Additionally, some contracts will be terminated as Lufthansa Systems adjusts its portfolio. The Jetzt! program, in contrast, will result in sustained cost reductions and generate additional revenues. Lufthansa Systems therefore expects earnings to turn around in 2011.