Published: February 17, 2023 at 3:27 am ET
By Mauro Orru
Shares in Air France-KLM jumped in morning trading on Friday after the Franco-Dutch carrier group swung to a profit and booked record fourth-quarter revenue amid a surge in demand for air travel after years of restrictions and border closures .
At 0820 GMT, shares were trading 7.2% higher at 1.79 euros.
The…
By Mauro Orru
Shares in Air France-KLM jumped in morning trading on Friday after the Franco-Dutch carrier group swung to a profit and booked record fourth-quarter revenue amid a surge in demand for air travel after years of restrictions and border closures .
At 0820 GMT, shares were trading 7.2% higher at 1.79 euros.
The group posted a net profit of 496 million euros ($529.3 million) compared to a loss of 126 million euros in the fourth quarter of 2021. For the year, the company reported a profit of 728 million euros compared to a loss of 3.29 billion euros in 2021.
“Despite the Omicron strain, the war in Ukraine, the inflationary situation and operational disruptions at major international airports last summer, our group and its airlines were able to successfully capture strong travel demand,” said chief executive Benjamin Smith. .
The company added an aircraft to its long-haul fleet last year. It also phased out older-generation aircraft, reducing its medium-haul fleet by seven aircraft and its regional fleet by nine. The group said it will continue to invest in new generation aircraft this year and beyond.
Travel restrictions and border closures brought international traffic to a near standstill at the height of the pandemic. Now, airlines are scrambling for planes to expand capacity to meet the growing demand for international air travel.
The group’s quarterly operating income, a metric closely watched by analysts and investors, fell to 134 million euros from 179 million euros, generating a margin of 1.9%. Quarterly revenues increased by 47% to 7.13 billion euros.
Air France-KLM was expected to post a net loss of 57 million euros, operating income of 102 million euros and revenue of 6.89 billion euros for the fourth quarter, according to a consensus provided by the company that collected estimates from 18 analysts.
Pricing momentum for long-haul routes supported operating income, Citi analysts wrote in a note to clients.
For the current quarter, the group is targeting 90% to 95% of capacity in available seat kilometers. For the year as a whole, it expects 95% to 100% capacity, reaching 2019 levels by 2024.
Write Mauro Orru at mauro.orru@wsj.com; @MauroOrru94
