Payback time: financially healthier KLM repays hundreds of millions of corona government loan

KLM has started to repay the loan it received from the Dutch state during the corona crisis. The company has that opportunity because it made a profit for the third quarter in a row at the beginning of this year.

At the end of June 2020, the then Ministers of Finance Hoekstra and Van Nieuwenhuizen of Infrastructure and Water Management announced that KLM would receive a support package of 3.4 billion euros to survive the coronavirus crisis. The largest part of this (2.4 billion euros) consisted of guarantees on commercial loans, the rest (942 million) from a loan from the state.

There was, or is, something in return: by accepting the support package, KLM has committed itself to reduce the number of night flights at Schiphol by a fifth, from 32,000 per year to a maximum of 25,000 per year. The company also had to cut costs cut the workforce significantly

Black numbers

From January to March of this year, the company achieved a turnover of more than 1.9 billion euros. That is more than double compared to the first three months of 2021, when aviation was still largely at a standstill due to the corona pandemic.

But the company is not only generating more turnover, it is also moving in the right direction below the line. Although a profit of ‘only’ 3 million euros was made in the first three months of this year, this is a much better result than a year earlier. At that time, KLM still suffered a loss of 337 million euros. By way of comparison: KLM still booked a loss of 1.2 billion euros over the whole of 2020.

The good figures are mainly due to the increased number of passengers. Compared to the first three months of last year (1.4 million), more than three times as many passengers boarded KLM aircraft in the first three months of this year (4.8 million).

It should be noted that KLM – like all Dutch companies – could still rely on NOW support in the first quarter of this year. The 140 million euros that the company was transferred in this form partly contributes to the positive financial result.

311 million euros repaid

KLM made 311 million euros to the state coffers earlier this week, and director Pieter Elbers hopes – in view of the developments in aviation – to be able to make more repayments this year. The company still owes 631 million euros.

“An incredibly important step in many respects that underlines the resilience and commitment of all KLM colleagues. In the coming period, the focus will be on repaying the loans on the one hand and on the operation and workload on the other hand,” he says in the press release.

Chaos at Schiphol

With ‘work pressure’ he refers to the staff shortages and the chaos that repeatedly arose at Schiphol as a result of this May holiday. On top of the staff shortages came the first weekend of the May holiday a wild strike by baggage workerswhich led to huge crowds, more than a hundred canceled and many more delayed flights and a traffic jam around Schiphol.

The day before yesterday, Schiphol CEO Dick Benschop apologized for the inconvenience and promised to hire hundreds of extra security personnel. According to FNV, that is not enough: the union has therefore submitted a package of requirements for all Schiphol to the management. A discussion about that package of requirements went positively, FNV spokesman Joost van Doesburg reported yesterday. Talks continue today.

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