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Lufthansa Swings To 2012 Profit, Suspends Dividend

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Lufthansa posted a net profit of EUR€990 million (USD$1.32 billion) in 2012, as the one-off sale of equity investments helped it swing from a loss of EUR€13 million a year earlier.

The airline said it planned to suspend its dividend payment and fully retain its net profit as it bolstered a restructuring program.

"The Executive Board plans to close sites and to merge administrative functions," the airline said in a statement on its 2012 results, released in advance of scheduled publication on March 14.

Operating profit fell to EUR€524 million from EUR€820 million a year earlier, reflecting in part costs of EUR€160 million for the group's cost-cutting program, SCORE.

Lufthansa had warned last year that the planned gains from SCORE would be eaten up by high jet fuel prices and a slower economy and that it would have to intensify its savings effort.

The cost-cutting plan is aimed at sustainably improving the operating result by EUR€1.5 billion by 2015.

The company said the partial transfer of Austrian Airlines' flight operations to Tyrolean Airways gave a one-time boost of EUR€115 million to the 2012 operating result.

Lufthansa also said it plans to order eight long-haul aircraft and 100 short- and medium-haul aircraft, with a total cost of around EUR€9 billion, to be delivered between 2015 and 2025 from Airbus and Boeing.

(Reuters)