Air France-KLM Cargo Earns First Half Profit

Air France-KLM Cargo Earns First Half Profit

Air France-KLM booked a profit on cargo operations for the second successive quarter as revenue soared almost 38 percent above a year ago.

The airline said the recovery in its cargo business contributed to an overall second quarter operating profit of $778 million compared with a year earlier loss of $63.5 million.

The cargo division made an operating profit of $9.5 million on cargo revenue of $1.07 billion in the three months to Sept. 30.

By The Numbers: European Airlines' Freight Traffic.

Cargo revenue grew twice as fast as passenger sales, which increased 18 percent to $6.9 billion during the period.

The Franco-Dutch carrier's cargo unit swung to a first half profit of $24.5 million from a year-earlier loss of $467.8 million as revenue rose to $2.13 billion from $1.53 billion.

Air France-KLM attributed its improved cargo performance to strict management of capacity, which remains below 2008 and 2009 levels.

The load factor on cargo carried in the bellies of passenger jets rose by 5.3 percentage points in the second quarter to 59.9 percent while the combi aircraft load factor was 1.8 points higher at 84.4 percent.

Freighters, which account for 34 percent of Air France-KLM's cargo capacity, boosted their load factor by 3.7 points to 74.7 percent.

Air France-KLM said the $462 million it was fined by the European Union last week for participating in a global cargo price fixing cartel was $173 million more than it had put aside to cover an anticipated penalty.

The carrier said it is targeting an operating profit on its cargo operations for the full year to March 31, 2011.

-- Contact Bruce Barnard at brucebarnard47@hotmail.com.