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60 _ AIR FRANCE-KLM 2010-11 Annual Report
WHAT WERE THE HIGHLIGHTS OF AIR FRANCE-KLM’S
2010-11 RESULTS?
Philippe Calavia: We returned to positive territory in terms
of both the operating result, which reached €122 million
after a loss of €1.285 billion one year ago, and the net
result which amounted to €613 million, notably due to
the revaluation of Amadeus shares on the occasion of the
company’s stock market flotation in April 2010.
Frédéric Gagey: And this was achieved despite having
to contend with numerous challenges from the Icelandic ash
cloud early in the financial year to the heavy snowfall at the
end of 2010, the political upheaval in North Africa, the
Japanese catastrophe and the soaring oil price which was
particularly marked during the final quarter of the 2010-11
financial year.
WHAT WERE THE KEY FACTORS IN THE RECOVERY?
PC: Over the year as a whole, the €1.4 billion improvement
in the operating result came above all from a strong rebound
in revenues which increased by €2.6 billion, growth of 13%.
The Group’s results were, however, penalized by the very
sharp rise in the fuel bill. Excluding fuel, the Group achieved
a very good performance in terms of reducing operating
costs. The restructuring and adaptation measures
implemented since the beginning of the crisis have thus
produced a positive result. Unit costs excluding currency
and fuel fell by 0.5% over the year, and by 1.3% if you
neutralize the effects of the events that significantly disrupted
our activity in 2010-11.
FG: I would also like to highlight the success of our Challenge
2012 program which enabled the achievement of €595
million of cost savings, surpassing the initial target by some
hundred million euros. This is thanks to a mobilization of the
teams in all sectors to contain procurement, improve
productivity, implement the necessary restructuring, in cargo
for example, while continuing to deliver a high-quality service.
The three main businesses experienced a strong improvement
in their overall results: the passenger business approached
break-even, cargo returned to profit after a very challenging
2009-10 and maintenance saw a marked improvement in its
contribution to operating income.
REVENUES
(E billion)
2009-10 21.0
2010-11 23.6
EBITDAR
(E billion)
2009-10 1.1
2010-11 2.6
EBITDAR measures the management
performance, corresponding to the
difference between revenues and
operating expenses, excluding operating
leases, depreciation and provisions.
It makes it easier to compare different
airlines whatever the method used
to finance their fleets.
OPERATING INCOME/(LOSS)
(E billion)
2009-10 -1.28
2010-11 0.4
NET INCOME/(LOSS)
(E billion)
2009-10 -1.56
2010-11 0.6
“The trends already
in place in 2010-11 show
that we are on the right
track. This remains to be
consolidated.”
billion euros generated
by the fuel hedges in seven years