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Garuda Indonesia is optimistic that it will not breach key debt covenants as its financial situation is looking stronger this year. The carrier says that after it restated its 2018 financial results, its capital level for the year fell to US$730m, forcing it to seek a waiver from Export Development Canada for breaching the $800m minimum required under a debt covenant. The loan aided its acquisition of Bombardier CRJ 1000s and caps the carrier's debt-to-equity ratio at 2.5x. During Q1 of 2019, however, its capital level rose to $791m. It has not yet disclosed its accounts for Q2. Finance director Fuad Rizal said that other creditors have agreed to the debt covenant proposals the airline had made, without providing any other details. <br/>

Vietnam Airlines is exploring an order for 50 narrowbodies and up to 15 regional jets as it puts plans for a long-range widebody on the backburner. The airline is looking at both Boeing and Airbus types to fill the narrowbody requirement, says the airline's CE, Duong Tri Thanh. “By definition it's a narrowbody [and] whether it’s a Boeing or an Airbus, it is open for consideration,” he says. “When the fleet is below 50-70 there is a need to have a common type.” He adds that the newly-launched A321XLR is a “very interesting type of aeroplane and we would seriously consider it,” as it would be effective on long, thin routes that “cannot support larger aircraft.” Vietnam Airlines operates 53 A321ceos. The average age of the A321ceo fleet is 8.3 years, with the oldest aircraft at 15.2 years of age. <br/>

Air France-KLM posted a Q2 operating profit of E400m (US$446m), a nearly 16% increase from E346N a year ago, as revenue gains and lower unit costs offset a higher fuel bill. The results came a day after the group signed an MOU for 60 Airbus A220s and as its pilots approved fleet growth plans for LCC subsidiary Transavia France. Total revenue at constant currency was up 4.5% year-over-year to E7b. Passenger unit revenue rose 0.8% as unit costs, on a constant currency and fuel price basis, declined 2.3%. Fuel costs were up nearly 19% YOY. The group said cost-cutting measures and the high basis of comparison because of last year’s Air France strikes—which had a E260m negative impact on the Q2 2018 operating profit—contributed to the improved results. <br/>

Air France-KLM intends to replace the carrier's fleet of 10 Airbus A380s with no more than 9 long-haul twinjets. CE Ben Smith said Wednesday that the group was in "advanced" talks with Airbus about ordering A330-900s or A350-900s and with Boeing about a possible deal for 787-9s as replacements for the double-deck type. July 30 Air France-KLM disclosed that it would phase out the A380 by 2022 under an "accelerated" retirement plan. The group had previously decided to decommission an initial 3 A380s. Air France-KLM foresees that retirement of its A380s will generate capital-expenditure savings around E400m. But the airline also sees one-off costs of the same magnitude – largely as a result of faster depreciation of the long-haul jets – for the 2019-22 period. <br/>