Air France-KLM Profit Jumps on Summer Sales, Year-Ago Strike
Air France-KLM Group said its third-quarter profit tripled to the highest level in at least a decade, spurred by strong summer sales, lower fuel prices and a lull in industrial action that hurt year-a...
Air France-KLM Group said its third-quarter profit tripled to the highest level in at least a decade, spurred by strong summer sales, lower fuel prices and a lull in industrial action that hurt year-ago figures.
Earnings before interest and tax rose to €898 million from €247 million in the equivalent period in 2014, when a weeks-long pilot strike wiped €330 million from earnings, Europe’s biggest carrier said Thursday in a statement. Analysts had predicted a figure of €808 million, on average.
With the Air France unit locked in a standoff with unions over plans to increase working hours for the same pay or cut jobs, Chief Financial Officer Pierre Riolacci said external factors aided profit and that the company can’t yet take on Persian Gulf carriers led by Emirates and European discounters such as EasyJet.
“Our good performance in the third quarter was essentially linked to favorable conditions,” Riolacci said. “So it’s inevitable that our competitors will also improve their performances for the quarter. Air France still has a gap in productivity relative to rivals, and that’s something we need to eliminate.”
The pace of savings is also slowing, the company said, with the reduction in unit costs for the full year compared with 2014 now likely to be between 0.5 and 0.7 per cent rather than the previously targeted one per cent to 1.3 per cent range.
News by Bloomberg, edited by Hospitality Ireland