Air France-KLM's cargo unit swung to an $81.6 million operating profit in the final three months of 2010 from a $39.5 million loss a year ago, extending a year-long recovery that has been driven by sharply higher margins.
Revenue jumped almost 28 percent to $1.1 billion in the carrier's fiscal third quarter from $884 million in the year-earlier period.
Traffic rose 4.9 percent in the quarter from a year ago on a 3.8 percent increase in capacity, which boosted the load factor almost one percentage point to 70.4 percent.
By The Numbers: European Airlines' Freight Traffic
Unit revenue per ton of cargo transported gained 27.7 percent in the quarter.
Cargo booked a profit of $106 million in the first nine months of the fiscal year against a $507 million loss a year earlier as revenue soared 35.4 percent to $3.25 billion from $2.4 billion.
Traffic grew only 3.4 percent in the first nine months while unit revenue was up 30.9 percent.
The strong cargo performance contrasted with setbacks at the passenger unit caused by strikes by French air traffic controllers in October and harsh weather in December that resulted in thousands of cancelled flights and pushed Europe's largest carrier into an unexpected quarterly loss of $62.5 million compared with a loss of $401 million a year earlier.
As a result, Air France-KLM is now forecasting a "positive operating result" for the fiscal year ending March 31 below its previous target of an operating profit of at least $408 million.
The carrier said "security issues" in countries it flies to in Africa, including Niger, Mali and the Ivory Coast and more recently Egypt and Tunisia likely will impact revenue in the current quarter.
Air France-KLM increased cargo volume 3.4 percent year-on-year in January on a 3.3 percent increase in capacity. The increase was substantially smaller than the 17.5 percent growth in January at rival Lufthansa Cargo. Americas traffic rose 5 percent and Asia-Pacific shipments gained 8.4 percent.
"The numerous one-off events (volcano, weather disruptions, air traffic control stoppages and geopolitical events) which have affected the current year do not call into question the structural recovery achieved by the group in 2010," the airline said. "Our ability to adapt the network to geopolitical constraints remains."
-- Contact Bruce Barnard at email@example.com.