A corner of blue sky after the cyclone: Air France-KLM said Friday to see "
" of recovery this summer, but it will take years for the Franco-Dutch air group to leave the Covid-19 crisis behind.
Overwhelmed by travel restrictions and its fixed costs, Air France-KLM has accumulated losses since the start of the pandemic, and the second quarter of 2021 was no exception: 1.5 billion euros, as much as first quarter, after 7.1 billion in 2020.
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The figures are better than in the second quarter of 2020, when almost all air transport was paralyzed.
The number of passengers jumped 477% year on year to 7 million.
Turnover also increased strongly (+ 133% to 2.75 billion euros).
But from April to June, the seat supply of the companies of the group (Air France, KLM and the “
” Transavia) reached only 48% of that of the same period of 2019. Turnover fell 60% over two years.
The takeover depends on the lifting of the remaining restrictions
We have seen early signs of recovery,
” said CFO Steven Zaat. The group has found a positive free cash flow "
thanks to very good ticket sales
," he detailed during a conference call. There is a "
" for travel, "
when and where it is possible,
" confirmed Air France-KLM CEO Benjamin Smith. “
In the coming months, we expect a good recovery when the restrictions to and from our key markets are lifted,
” he added. Benjamin Smith has "
"Hoped to see the United States show reciprocity and reopen its borders to Europeans by the end of September at the latest, the North Atlantic axis constituting the"
"of the group.
Thanks to the lifting of certain restrictions and the summer appetite for southern European destinations, Air France-KLM increased its seat offer in July to more than 60% of the same period of 2019, and is targeting up to 70% on throughout the third trimester.
Both KLM and Air France will regain operational profitability over this period, for the first time since the start of the health crisis, said Steven Zaat.
Freight transport, which is currently very profitable, also helps cushion the shock.
On the other hand, the group has refrained from communicating its ambitions for the fourth quarter.
Still a lot of difficulties await us
,” conceded Benjamin Smith, stressing that the recovery would depend on “the
rapid deployment of large-scale vaccinations
Faced with the crisis, the group has taken drastic measures
Airlines, especially those which depend on long-haul routes like Air France and KLM, are still suffering: IAG (British Airways and Iberia) lost 2.05 billion euros in the first half of the year.
The Americans, who can count on a large domestic market, have begun their recovery: Delta posted its first quarterly profit since the end of 2019, while United reduced its loss and aims to return to green in the second half of the year.
Faced with the crisis, Air France and KLM have taken drastic measures, initiating voluntary departure plans which will have affected 14,000 people in total by the end of 2022 and reducing their fleet of aircraft (-7% between 2019 and 2022).
The group is still targeting a return to 2019 capacities in 2024. Highly indebted, Air France-KLM was recapitalized in April with the help of the French State, which doubled its stake from 14.3% to 28.6% .
The Dutch state is still discussing specific aid for KLM with the European Commission, according to Steven Zaat, who also indicated that the group was negotiating with banks to spread loan repayments further.
At the end of May, the shareholders gave the green light to new issues of shares up to an amount of up to 300% of the current capital.
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Despite the help of the French state, which has converted into quasi-equity 3 billion euros in loans, the group's debt remains high, at 8.3 billion.
A new stage of recapitalization will therefore be necessary to achieve by 2023 the objective of a net debt that does not exceed double the gross operating surplus: this ratio is an indicator scrutinized by investors because it reflects the company's ability to honor its debts.