Air France-KLM Profit Up Despite Strikes
November 03 2016 - 4:00AM
Dow Jones News
PARIS—Air-France-KLM SA said Thursday that its net profit rose
in the third quarter as lower fuel costs and cost-cutting more than
offset losses from strikes and pressure on tourism from terror
fears.
Air France-KLM, Europe's largest airline group by traffic, said
net profit rose to €544 million ($604 million) although revenue
contracted 5.1% during the period to €6.94 billion. When stripping
out the effects of currency swings and losses and gains on fuel
future contracts, net profit fell to €521 million from €612 million
in the same period a year ago.
Analysts polled by FactSet on average expected net profit of
€502 million during the quarter.
The breathing space given by fuel prices in 2015 that made the
Franco-Dutch airline profitable after seven consecutive years of
losses is narrowing under the pressure of increased competition on
long and medium-haul routes and tourist disaffection for France
following recent terror attacks.
Additionally, the company's bottom line suffered from conflicts
between management and workers. A partial strike of flight
attendants cost the company at least €90 million during the summer.
Previously, a clash between unions ended with an angry mob tearing
off executives' shirts.
Still, despite all the headwinds and no improvement foreseen,
Mr. Riolacci said he expects the company to remain profitable in
2016.
Write to Inti Landauro at inti.landauro@wsj.com
(END) Dow Jones Newswires
November 03, 2016 04:45 ET (08:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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