News Column

Air France KLM narrows losses but shares fall

May 1, 2014

CITY A.M. REPORTER



AIR FRANCE-KLM narrowed its losses in the first quarter on the back of cost cuts and lower fuel prices, and announced a breakthrough contract in China for its maintenance business, the France-Dutch group's only profitable division.


However, Paris-listed shares in the firm fell seven per cent to 10.36.


Europe's second-largest network carrier by revenue yesterday reaffirmed its financial targets for the year in the face of "tough" conditions, as first-quarter operating losses declined to 445m (366m) from 532m a year earlier.


Revenue rose 2.2 per cent to 5.55bn, and underlying losses more than halved to 50m. The group reiterated its 2014 target for 2.5bn in earnings before interest, tax, depreciation and amortisation.


"We weren't helped by the economic climate, nor did it get worse, but there is no oxygen from that side of our business," chief executive Alexandre de Juniac said.


Air France-KLM said it had won a contract worth over $1bn from Air China to maintain 20 Boeing 777 aircraft in China in a deal that could be extended to eight freighters.


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Source: City A.M. (UK)


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