In a “challenging” first quarter of 2019, Air France KLM Group posts a net loss of €303 million

The Air France KLM Group just published the financial results for the first quarter of 2019. Despite higher capacity (+3%), traffic (+2.6%) and revenue (+3.1% to €5.986 billion), the operating result of the group significantly dropped resulting in a net result of €-303 million (compared to €-118 million in the first quarter of 2018). Net results for Air France (€-256 million), KLM (€-56 million) and Transavia (€-71 million).

Benjamin Smith, Air France-KLM Group CEO said: “As anticipated, the first quarter has been challenging for the European airline industry including the Air France-KLM Group, as substantial industry capacity growth in the off-peak business period led to unit revenue pressure. In this context, the Group achieved further improvement in unit cost while reaping the benefits of its efforts to strengthen its positioning, as evidenced by the first signs of progress in operational performance at Air France, notably in term of “Net Promoter Score” and punctuality. These elements, together with a more benign industry
supply outlook for the summer, lead us to expect improving trends in the rest of the year and to confirm our full-year guidance. We aim to have a capital market day planned in November 2019 to further outline the Group strategic directions.”

OUTLOOK 2019

• Long Haul industry capacity to / from Europe for the summer 2019 is projected to grow at a slower pace compared to last year, particularly to Middle East, North America and Asia.
• Based on current data for Passenger network:
  • Long-haul forward booking load factors from May to September are on average ahead
    compared to last year.
  • Network passenger unit revenues at constant currency expected to slightly improve
    compared to last year for the second quarter 2019, with positive long haul unit revenues largely offset by negative point-to-point unit revenues.
• Full year guidance confirmed:
  – Unit cost (CASK) reduction between -1% and 0% at constant currency and fuel price,
  – Net debt/EBITDA ratio below 1.5x.

Read the full press release (PDF).