EUROPE & CIS: AF-KLM sinks deeper into red
The Air France-KLM group reported this week its biggest loss since the merger of the two carriers in 2004 with a loss of of Ã¢â€šÂ¬1.56 billion for the full-year ended 31 March, up from a loss of Ã¢â€šÂ¬814 million a year earlier. Revenue fell 15 per cent year-on-year to Ã¢â€šÂ¬21 billion. The groupÃ¢â‚¬™s finances were […]
June 1, 2010
The groupÃ¢â‚¬™s finances were starting to improve at the end of 2009 on signs of an upswing in traffic, but earnings have been pulled down since April due to the impact of ash clouds from an Icelandic volcano, which closed much of EuropeÃ¢â‚¬™s airspace for six days last month. Air France-KLM said the ash cloud closures had caused it to lose Ã¢â€šÂ¬260 million of revenue together with costs for looking after stranded passengers. The impact on the airlineÃ¢â‚¬™s operating earnings so far has been Ã¢â€šÂ¬160 million.
For the three months ended 31 March, Air France-KLM reported a net loss of Ã¢â€šÂ¬691 million, more than double the loss of Ã¢â€šÂ¬295 million in the third quarter and up from a loss of Ã¢â€šÂ¬479 million in the three months to 31 March 2009.
The airline said it had taken a hit of Ã¢â€šÂ¬637 million from out-of-the-money fuel hedges in the year and Ã¢â€šÂ¬173 million in the last quarter alone. Chief executive Pierre Henri Gourgeon said in a statement that the company reaffirms its objective of Ã¢â‚¬Å“break-even at the operating level in the current financial year excluding the impact of pre-2009 fuel hedges, and subject to the definitive cost of the closure of European airspace.Ã¢â‚¬Â