PARIS: Air France-KLM posted huge first-quarter losses on Thursday, pinning its hopes on a better summer to recover as it sees little improvement in global travel for now due to Covid restrictions.
With passenger numbers in the quarter down 73 percent compared with a year earlier, the French-Dutch group is pinning its hopes on mass vaccinations allowing global travel to kickstart again later in the year.
The Franco-Dutch group saw 1.5 billion euros ($1.8 billion) evaporate after tax in the first quarter — worse than forecast by analysts polled by Bloomberg News — while revenues were down 57 percent on a year earlier.
The French and Dutch governments have propped up the airline since the pandemic wrecked travel and tourism last year, with Paris coming to the rescue again last month.
“A year into the Covid crisis, lockdown measures and travel restrictions in our home markets and around the world continue to strongly impact the group’s activity,” chief executive Benjamin Smith said in a statement, describing the environment as “ever-challenging”.
Chief financial officer Frederic Gagey warned that the start of the second quarter was also “not showing any notable improvement” so far, with international flights still heavily restricted across much of the planet. Smith, however, insisted the company was looking forward “to the summer season with greater confidence, hoping that the progress of the vaccination roll-out worldwide and the implementation of travel passes will allow borders to reopen and traffic to recover”.
In the meantime, the airline is continuing with cost-cutting measures, including voluntary redundancies.
The French and Dutch governments provided 10 billion euros in loans to Air France-KLM last year.
In April, the French state doubled its stake in the company to nearly 30 percent. The airline also raised just over one billion euros in a share issue.
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