Issued on: 07/05/2020 – 08:10Modified: 07/05/2020 – 08:10
Two weeks of coronavirus shutdown were enough to hit Air France-KLM with an 815 million-euro ($880 million) first-quarter operating loss, the airline group said on Thursday – predicting demand could take "several years" to recover.
In the month of March there was an "abrupt plunge in revenue that will obviously extend through the second quarter," Chief Financial Officer Frederic Gagey warned.
Air France-KLM, which has received 7 billion euros in French-backed rescue aid and Dutch pledges for a further 2 billion to 4 billion, expects to reduce monthly cash burn to 400 million euros in the second quarter thanks to cost-cutting and state-funded furloughs that save 350 million euros a month.
But operating losses will widen "significantly" in April-June with 95% of flights expected to remain grounded by a combination of travel restrictions designed to contain the pandemic and collapsed demand.
Capacity will still be down 80% in the third quarter, the group predicted, with customers returning only gradually.
Airline group expects full-year loss
Air France-KLM's revenue fell 15.5% to 5.02 billion euros in the first quarter. Its net loss widened to 1.8 billion euros from 324 million, also swollen by a 455 million-euro impact from over-hedged fuel.
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