Air France-KLM sees profit rise dramatically in 2016 to €792 million

no image
No image availableNL Times

French-Dutch airline group Air France-KLM saw a significant increase in profits over 2016. The net profit for the company amounted to 792 million euros last year, compared to 118 million in 2015. The operating result also increased sharply to 1.05 billion euros, reports

The company benefited from cost cutting measures and a lower fuel bill. But did suffer from an increasing global pressure on ticket prices.

The underlying operating result for KLM improved from 384 million euros in 2015 to 681 million euros last year. Air France's underlying operating results declined to 372 million euros. The company's revenue also fell by more than 3 percent in 2016 and amounted to 25.7 billion euros. 

The total number of passengers in the group increased by 4.4 percent. That increase can mostly be attributed to KLM and budget-subsidiary Transavia. The capacity utilization - the extent to which planes are filled - improved for both KLM and Air France. 

Both KLM and Air France had personnel trouble in 2016. In the Netherlands KLM dealt with a pension dispute with the airline's pilots and the cabin crew protested the airline's decision to reduce the number of crew members on long-haul flights by striking for longer periods before each flight. There was also a dispute with ground crew about working conditions. A ruling by the court stopped strikes on this issue.

In France there was discontent among pilots about growing imbalances in the number of flights between Air France and KLM, among other things. This was also a topic of discontent in the Netherlands, where concerns reigned about KLM's independence because of rumored centralization, with more Dutch activities being transferred to the French company. 

The figures for the freight division are still not spectacular. There were decreases in the amount of freight carried, the load factor and revenue. Though the net loss decreased slightly by a million euros. 

Low-cost subsidiary Transavia managed to break even for the first time in its history. The airline saw the number of passengers increase both in the Netherlands and in France. The biggest growth came in the French branch, which saw passenger numbers increase by 23 percent. Transavia transported a total of over 13 million passengers in 2016, though the capacity utilization decreased by 0.7 percent.