Air France-KLM losses narrow as demand rebounds

Losses at Air France-KLM narrowed sharply in Q3 thanks to strong summer travel demand in countries that have opened their borders as pandemic restrictions ease. The airline on Friday reported a net loss of E192m for the three months to the end of September, a significant improvement on the E1.5b lost in each of the two previous quarters but still well below the E366m profit it made in Q3 2019. Analysts had expected a E318m net loss this time round. “We are showing that we are getting back on track,” said Steven Zaat, chief financial officer, adding that a rise in revenue was much higher than the company had hoped. “Capacity improves day by day [and] we are prepared to ramp up further but bookings are coming in much better than we expected,” he said. The Franco-Dutch company was hit hard by the collapse in air travel caused by the Covid-19 crisis and has struggled with a balance sheet holding billions in loans backed by the French and Dutch governments to help it through the period. Zaat said there was still a “big jump to make” to get back to pre-pandemic levels of profitability. The company’s operating profit came in at E132m, above consensus expectations of a E195m loss but still well below the E900m made in 2019. The airline reported capacity usage at 66% of pre-pandemic levels in Q3. The outlook for Q4 and into 2022 was also brighter than anticipated. The company said it expected passenger capacity to reach 70 to 75% of pre-pandemic levels in Q4 of the year and to achieve positive full-year earnings before interest, tax, depreciation and amortisation.<br/>