Despite the problems at Schiphol and the high fuel prices, airline Air France-KLM achieved more profit and more turnover in the third quarter than last year. The financial results were even better than in the third quarter of 2019, before the corona crisis that hit aviation hard.
The French-Dutch group announced its financial figures for the third quarter on Friday. Summer is the most important period in aviation, because many people go on holiday by plane.
KLM’s operating profit – before deduction of, among other things, interest and taxes – amounted to EUR 443 million in the quarter and that of Air France to EUR 570 million. For the entire group, the net profit was 460 million euros. In 2021, the company still suffered a quarterly loss of 193 million euros. The group estimates it will close this year with a profit of more than 900 million euros, not far below the 1.14 billion of 2019.
Air France, KLM and their budget airline Transavia together carried 25 million passengers. That was almost 48 percent more than in the third quarter of last year. Turnover rose even faster than the number of travelers: almost 78 percent to 8.11 billion euros. According to the company, the demand for airline tickets was not only higher, travelers also paid more money per ticket, including for more luxurious seats in the ‘economy plus’ class.
Chaos and strikes
The group could have achieved even better results, the management stated during a press conference in Paris, if there had been fewer operational problems at Schiphol this summer. The strikes of personnel at the airports in Paris also cost Air France-KLM money.
Together, the group has lost 60 million euros extra in compensation for injured travelers; half of the compensation, 30 million, will be borne by KLM. The Schiphol chaos and the Paris strikes also resulted in lost income of 225 million euros (KLM: 145 million).
Restrictions still apply at Schiphol in winter. For example, a maximum number of passengers is again maintained; that is determined by Schiphol. KLM regrets that this measure will limit the number of passengers for the airline. “This creates a hopeless situation that has been going on since May,” KLM said.
The temporary restrictions should be over by March, but then KLM will face a structural contraction of Schiphol from November 2023. The cabinet wants to reduce the number of flight movements from Amsterdam airport by 12 percent, to 440,000 per year, in order to reduce noise pollution. Marjan Rintel, CEO of KLM, said again on Friday that KLM has alternatives to make less noise. Rintel believes that the nuisance will be limited with new, quieter aircraft.
Air France-KLM expects to use about 85 percent of its capacity in the fourth quarter; previously, the group reported being able to fill 85 to 90 percent of the number of seats.
The airline group saw fuel costs rise sharply in the past quarter. The company lost 2.3 billion euros on kerosene. That is about three times as much as in the same period last year.
Portugal
During the press conference in Paris, CEO Ben Smith said that Air France-KLM is interested in acquiring shares in the Portuguese company TAP. “We are considering a collaboration or an acquisition if the circumstances are right.” TAP is interesting, among other things, because of its connections with Brazil.
A version of this article also appeared in the newspaper of October 29, 2022