Air France-KLM Sinks to Cargo Loss

Air France-KLM Sinks to Cargo Loss

Air France-KLM’s cargo unit swung to a $50.3 million loss in the fiscal second quarter ending Sept. 30 from a $9.5 million profit a year ago amid uncertainty over the airline company’s strategic direction as the carrier prepares to cut more costs and slash debt.

Cargo revenue slipped 1.7 percent to $1.05 billion in the three-month period, mainly the result of a weaker U.S. dollar and the decision to limit capacity, particularly freighter flights.

Traffic dipped 2.1 percent from a year ago on a 1.5 percent increase in capacity, which resulted in a 2.3 points decline in the load factor to 63.7 percent.

Cargo posted a loss of $69.4 million in the first half compared with a $24.5 million profit a year earlier while revenue grew 0.8 percent to $2.1 billion.

The cargo loss contributed to a 31 percent decline in Air France-KLM’s quarterly profit to $540 million from $783 million coupled with a forecast of a calendar year loss.

Air France-KLM trimmed freighter capacity by 8.8 per cent in October from a year ago and now operates only 17 of its 22 cargo aircraft.