30 July, 2022

Air France - KLM second quarter results show net income at 324 million euros.....

Positive operating result at 386 million euros
Net income at 324 million euros, showing a 1.8 billion euros improvement compared to the same quarter last year
Positive adjusted operating free cash flow at 1.5 billion euros thanks to positive EBITDA and strong ticket sales. It improved by 1.3 billion euros compared to the same quarter in 2021
The Group has already successfully achieved 2.8 billion euros of equity measures of the up to 4 billion announced last February
Air France-KLM/Air France redeemed 1.6 billion euros of the French State perpetual bonds (including coupon). KLM fully repaid the State backed RCF and direct Dutch State loan amounting for 942 million euros
Net debt at 6.0 billion euros, down by 2.2 billion euros compared to end of 2021 thanks to a positive adjusted operating free cash flow and the rights issue completed in June 2022

Mr Benjamin Smith, Group CEO, said: “The strong recovery we see this summer is putting the entire aviation industry to the test. While Air France-KLM had prepared for close to pre-pandemic demand levels, our airlines are not immune to the major operational challenges taking place around the world. Customer satisfaction is at the top of our priorities and we know we have not fully been able to deliver the quality of service that has come to be expected from us. I would like to thank our customers for their trust and patience. I would also like to express my gratitude towards our employees for their unwavering commitment, even in difficult situations. It is thanks to their dedication and sense of collective responsibility that we are able to post better-than-expected revenues and results this quarter. Going forward we will continue to implement our strategy in order to further transform our organization. We aim to increase our resilience to the changes of our environment while continuing to accelerate our efforts to make our Group and aviation as a whole more sustainable.”

Air France-KLM GroupSecond quarter operating margin at 2019 level despite the steep increase of fuel cost

 Second quarterHalf year
constant currency
constant currency
Passengers (thousands)22,803+224.5% 37,326+215.0% 
Capacity (ASK m)72,127+81.9% 130,192+75.3% 
Traffic (RPK m)61,365+243.4% 104,499+227.7% 
Passenger unit revenue per ASK (€ cts)     7.41+93.6%+89.1%6.51+91.8%+87.9%
Group unit revenue per ASK (€ cts)     8.52+46.1%+42.1%7.73+41.4%+38.0%
Group unit cost per ASK (€ cts) at constant fuel     7.98+3.2%-12.7%7.71-4.6%-15.6%
Revenues (€m)6,707+143.9%+138.7%11,152+127.1%+123.8%
EBITDA (€m)9311,1801,1861,1522,0292,050
Operating result (€m)3861,1391,145361,9701,989
Operating margin (%)5.8%+33.1 pt+32.8 pt0.3%+39.7 pt+39.5 pt
Net income - Group part (€m)324+1,813 -228+2,744 
Adj. operating free cash flow (€m)1,532+1,322 2,163+3,297 
Net debt at end of period (€m)1   6,036-2,180 

In the Second quarter 2022, the Air France-KLM Group posted a positive operating result of 386 million euros, up by 1,145 million euros at a constant currency compared to last year, and was driven by an increase of capacity. In parallel, the increase of load factor and yield generated an increase of the unit revenue.
Net income amounted to 324 million euros in the Second quarter 2022, an increase of 1.8 billion euros compared to last year. The recognition of tax assets at KLM group for an amount of around 300 million euros supported the positive net income generation.

In a challenging cost environment, transformation programs contain the unit cost up 2.4% with 15% capacity below 2019.

The unit cost is up 2.4% at a constant fuel price and constant currency versus the Second quarter 2019, with a capacity down by 15%. The ongoing transformation programs enable Air France-KLM to limit the impact of increasing costs such as airport and ATC charges, and the KLM Collective Labour Agreement (CLA) delayed implementation.

Compared to June 2019, the number of Full Time Equivalents (FTE’s) of Air France excluding Transavia reduced by 16% and by 13% for KLM.

Staff costs decreased in the Second quarter by 11% compared to the same quarter in 2019 thanks to FTE reduction and the French government support on wages. Corrected for government support on wages, staff costs decreased by 9%.

Cargo: Strong yield increase mitigates traffic impact on Asia trade lanes

 Second quarterHalf year
Cargo business2022ChangeChange
constant currency
constant currency
Tons (thousands)236-13.4% 472-12.7% 
Capacity (ATK m)3,341+27.4% 6,315+18.9% 
Traffic (RTK m)1,732-17.2% 3,497-16.1% 
Load factor51.8%-27.9 pt 55.4%-23.1 pt 
Total Cargo revenues (€m)918+2.6%-1.1%1,828+5.5%+2.2%
Scheduled cargo revenues (€m)801+0.7%-2.8%1,597+3.5%+0.4%
Unit revenue per ATK (€ cts )23.96-20.9%-23.7%25.29-13.0%-15.5%

Transavia: Capacity above pre-crisis level with a load factor of 85%

 Second quarterHalf year
Passengers (thousands)5,247+346.8%7,828+412.8%
Capacity (ASK m)10,430+221.9%15,924+274.6%
Traffic (RPK m)8,886+358.2%13,154+421.6%
Load factor85.2%+25.3 pt82.6%+23.3 pt
Total passenger revenues (€m)601+378.0%850+422.2%
Unit revenue per ASK (€ cts)5.86+51.0%5.41+41.2%
Unit cost per ASK (€ cts)6.04-12.5%6.11-31.9%
Operating result (€m)-18+80-110+108

Income Statement

 Second quarterHalf year
Revenues from ordinary activities6,7072,750+143.9%11,1524,910+127.1%
Aircraft fuel-1,863-520+258.3%-2,858-982+191.0%
Chartering costs-93-78+19.2%-193-147+31.3%
Landing fees and air route charges-436-245+78.0%-784-460+70.4%
Handling charges and other operating costs-401-211+90.0%-722-402+79.6%
Aircraft maintenance costs-603-447+34.9%-1,118-792+41.2%
Commercial and distribution costs-230-72+219.4%-384-131+193.1%
Other external expenses-368-254+44.9%-702-552+27.2%
Salaries and related costs-1,820-1,238+47.0%-3,343-2,406+38.9%
Taxes other than income taxes-34-29+17.2%-80-69+15.9%
Other income and expenses248163+52.1%503280+79.6%
Amortization, depreciation and provisions-545-504+8.1%-1,116-1,057+5.6%
Income from current operations386-753nm36-1,934nm
Sales of aircraft equipment39-11nm39-14nm
Other non-current income and expenses-10-849-98.8%-15-853-98%
Income from operating activities415-1,613nm60-2,801nm
Cost of financial debt-136-149-8.7%-277-339-18.3%
Income from cash and cash equivalent12-50.0%03-100.0%
Net cost of financial debt-135-147-8.2%-277-336-17.6%
Other financial income and expenses-2385nm-286-85+236.5%
Income before tax42-1,755nm-503-3,222-84.4%
Income taxes283272+4.0%278263+5.7%
Net income of consolidated companies325-1,483nm-225-2,959-92.4%
Share of profits (losses) of associates0-9-100.0%-1-16-93.8%
Net income for the period325-1,492nm-226-2,975-92.4%
Non-controlling interests1-3nm2-3nm
Net income for the period – Group part324-1,489nm-228-2,972-92.3%

* Restated figures include the change in accounting principles for pensions (interpretation of IAS19)

Consolidated Balance Sheet

Assets30 Jun 2022

31 Dec 2021

Intangible assets1,2131,235
Flight equipment10,52110,466
Other property, plant and equipment1,3581,402
Right-of-use assets5,4395,148
Investments in equity associates108109
Other non-current financial assets1,064951
Non-current derivatives financial assets304143
Deferred tax assets494278
Total non-current assets20,72419,954
Assets held for sale7874
Other current financial assets589484
Current derivatives financial assets954469
Trade receivables2,0451,511
Other current assets1,133966
Cash and cash equivalents8,1736,658
Total current assets13,62610,729
Total assets34,35030,683

Liabilities and equity30 Jun 2022

31 Dec 2021

In million euros
Issued capital2,571643
Additional paid-in capital5,2174,949
Treasury shares-25-25
Perpetual bonds1,3893,151
Reserves and retained earnings-12,349-12,542
Equity attributable to equity holders of Air France-KLM-3,197-3,824
Non-controlling interests108
Total Equity-3,187-3,816
Pension provisions1,5581,939
Non-current return obligation liability and other provisions4,2724,055
Non-current financial liabilities10,56811,274
Non-current lease debt3,3352,924
Non-current derivatives financial liabilities125
Deferred tax liabilities31
Other non-current liabilities2,4652,555
Total non-current liabilities22,20222,773
Current return obligation liability and other provisions838885
Current financial liabilities1,0791,215
Current lease debt851825
Current derivatives financial liabilities4246
Trade payables2,8211,850
Deferred revenue on ticket sales4,9382,644
Frequent flyer programs868888
Other current liabilities3,8963,369
Bank overdrafts24
Total current liabilities15,33511,726
Total equity and liabilities34,35030,683

Statement of Consolidated Cash Flows from 1st January until 30 June 2022

€m30 Jun 202230 Jun 2021*
Net income-226-2,975
Amortization, depreciation and operating provisions1,1161,057
Financial provisions6958
Loss (gain) on disposals of tangible and intangible assets-4014
Loss (gain) on disposals of subsidiaries and associates--26
Derivatives – non monetary result-20-29
Unrealized foreign exchange gains and losses, net24086
Other non-monetary items-90762
Share of (profits) losses of associates116
Deferred taxes-282-265
Financial Capacity785-1,287
(Increase) / decrease in inventories-7912
(Increase) / decrease in trade receivables-437-268
Increase / (decrease) in trade payables971138
Increase / (decrease) in advanced ticket sales2,276489
Change in other receivables and payables104749
Change in working capital requirement2,8351,120
Net cash flow from operating activities3,620-167
Acquisition of subsidiaries, of shares in non-controlled entities-2
Purchase of property, plant and equipment and intangible assets-1,491-1,099
Proceeds on disposal of subsidiaries, of shares in non-controlled entities-71
Proceeds on disposal of property, plant and equipment and intangible assets476565
Decrease (increase) in net investments, more than 3 months685
Dividends received1-
Net cash flow used in investing activities-1,008-376
Increase of equity1,5511,024
Coupons on perpetual-229-
Issuance of debt552690
Repayment on debt-1,187-750
Payments on debt on lease with bargain option-228-385
Payments on lease debt-442-433
New loans-175-37
Repayment on loans1644
Net cash flow from financing activities-1,135153
Effect of exchange rate on cash and cash equivalents and bank overdrafts (net of cash acquired or sold)401
Change in cash and cash equivalents and bank overdrafts1,517-389
Cash and cash equivalents and bank overdrafts at beginning of period6,6546,422
Cash and cash equivalents and bank overdrafts at end of period8,1716,033

* Restated figures include the change in accounting principles for pensions (interpretation of IAS19)
Return on capital employed (ROCE)

In million euros30
Jun 2022
31 Mar 202231 Dec 202130* Sep 202130* Jun 202131* Mar 202131* Dec 202030* Sep 2020
Goodwill and intangible assets1,4371,4731,4571,4561,4641,4791,4451,470
Flight equipment10,52110,53710,46610,47810,64510,80011,03111,009
Other property, plant and equipment1,3581,3781,4021,4181,4531,4761,5481,535
Right of use assets5,3935,2055,1485,0615,0334,7954,6784,789
Investments in equity associates108107109172166223230224
Financial assets excluding marketable securities and financial deposits162158157147147146146135
Provisions, excluding pension, cargo litigation and restructuring-4,471-4,239-4,173-4,180-4,033-4,083-3,922-4,002
WCR, excluding market value of derivatives-11,156-9,589-8,262-7,995-7,745-6,410-6,505-6,894
Capital employed3,3525,0306,3046,5577,1308,4268,6518,266
Average capital employed (A)5,3118,118
Adjusted results from current operations344-4,119
- Dividends received00
- Share of profits (losses) of associates-12-45
- Normative income tax-801,211
Adjusted result from current operations after tax (B)252-2,953
ROCE, trailing 12 months (B/A)4.7%-36.4%

* Restated figures include the change in accounting principles for pensions (interpretation of IAS19)

Net debt

 Balance sheet at
€m31 Jun 202231 Dec 2021
Current and non-current financial liabilities11,64712,489
Current and non-current lease debt4,1863,749
Accrued interest-122-128
Deposits related to financial liabilities-96-99
Deposits related to lease debt-96-85
Derivatives impact on debt-60-14
Gross financial debt (A)15,45915,912
Cash and cash equivalents8,1736,658
Marketable securities85189
Cash secured424324
Triple A bonds743529
Bank overdrafts-2-4
Net cash (B)9,4237,696
Net debt (A) – (B)6,0368,216

Adjusted operating free cash flow

 Second quarterHalf year
Net cash flow from operating activities2,2397143,620-167
Investment in property, plant, equipment and intangible assets-787-632-1,491-1,099
Proceeds on disposal of property, plant, equipment and intangible assets305345476565
Operating free cash flow1,7574272,605-701
Payments on lease debt-225-217-442-433
Adjusted operating free cash flow1,5322102,163-1,134

Bridge from EBITDA to Financial capacity



Second quarterFirst Half
Provisions (CO2 and other)-27-70-16-28
Correction of spare parts inventory1233
Addition to pension provisions336065137
Reversal to pension provisions (cash-out)-19-40-32-83
Sales of tangible and intangible assets (excluding aeronauticals)31703131
Income from operation activities - cash impact950-2271,203-817
Restructuring costs-68-80-125-125
Other non-current income and expenses--63-2-63
Cost of financial debt-139-134-283-302
Financial income-3-3-8-7
Realized foreign exchanges gain/loss-1120347
Termination of trading hedges - cash--1--8
Settlements of forwards derivates - cash--2--2
Current income tax-1-4-2
Other financial charges & expenses - cash--8--8
Other elements--1-
Financial capacity729-497785-1,287

* Restated figures include the change in accounting principles for pensions (interpretation of IAS19)

Unit cost: net cost per ASK

 Second quarterHalf year
Revenues (in €m)6,7072,75011,1524,910
Income/(loss) from current operations (in €m) -/--386753-361,934
Total operating expense (in €m)6,3213,50311,1166,844
Passenger network business – other revenues (in €m)-103-77-208-131
Cargo network business – other revenues (in €m)-117-99-231-190
Third-party revenues in the maintenance business (in €m)-345-255-642-514
Transavia - other revenues (in €m)10-12-
Third-party revenues of other businesses (in €m)-8-6-13-13
Net cost (in €m)5,7583,06610,0345,997
Capacity produced, reported in ASK*72,12739,657130,19274,254
Net cost per ASK (in € cents per ASK)7.987.737.718.08
Gross change 3.2% -4.6%
Currency effect on net costs (in €m) -70 -118
Change at constant currency 0.9% -6.4%
Fuel price effect (in €m) 492 668
Net cost per ASK on a constant currency and fuel price basis (in € cents per ASK)7.989.157.719.14
Change at constant currency and fuel price basis -12.7% -15.6%

* Restated figures include the change in accounting principles for pensions (interpretation of IAS19)
(1) The capacity produced by the transportation activities is combined by adding the capacity of the Passenger network (in ASK) to that of Transavia (in ASK).

Group results
Air France Group

 Second quarterHalf year
Revenue (in €m)4,062+146.7%6,743+125.8%
EBITDA (in €m)444+726422+1,217
Operating result (in €m)133+700-230+1,179
Operating margin (%)3.3%+37.8 pt-3.4%+43.8 pt
Operating cash flow before WCR and restructuring cash out (in €m)343+741255+1,274
Operating cash flow (before WCR and restructuring) margin8.4%+32.6 pt3.8%+37.9 pt

KLM Group

 Second quarterHalf year
Revenue (in €m)2,782+130.5%4,685+119.2%
EBITDA (in €m)495+462729+807
Operating result (in €m)262+447266+787
Operating margin (%)9.4%+24.8 pt5.7%+30.1 pt
Operating cash flow before WCR and restructuring cash out (in €m)469+525667+836
Operating cash flow (before WCR and restructuring) margin16.9%+21.5 pt14.2%+22.2 pt

NB: Sum of individual airline results does not add up to Air France-KLM total due to intercompany eliminations at Group level

Group fleet at 30 June 2022

Aircraft typeAF
(incl. HOP)
(incl. KLC & MP)
TransaviaOwnedFinance leaseOperating leaseTotalIn operationChange / 31/12/21
B777-3004316 1916245959 
B777-2001915 27 73433-3
B787-91013 47122323 
B787-10 6 24 65 
A380-8008  4138  
A350-90018  37818186
A330-300 5   5551
A330-200156 11 102121 
Total Long-Haul1136107035691741644
B737-900 5 5  55 
B737-800 31953388512612610
B737-700 1047 71414 
A32119  11 81919 
A32041  44334140-2
A31925  12 132524-4
A31812  6 61211-1
A220-30010  7 31093
Total Medium-Haul107469985121552522486
Canadair Jet 10009  9  96-5
Canadair Jet 700         
Embraer 195 E2 12   1212125
Embraer 1901930 1652849492
Embraer 175 17 314 1717 
Embraer 17013  10 31313-2
Embraer 1452  2  2  
Total Regional43590401943102970
B747-400ERF 3 3  33 
B747-400BCF 1 1  11 
B777-F2    222 
Total Cargo240402660