Air France-KLM reported second-quarter earnings that beat expectations amid strong demand for air travel that the airline group said shows no sign of abating.
Operating income rose 90% to €733 million ($806 million), exceeding analyst expectations of €649 million, as the number of passengers carried increased alongside higher load factors and strong yields, the group said in a statement on Friday. Sales rose 14% to €7.6 billion, also ahead of estimates.
The Franco-Dutch group said the booking environment remains strong, even for budget subsidiary Transavia, which in recent months was hurt by French air-traffic controller strikes and a fleet shortage in the Netherlands.
Air France-KLM is not the only group still benefiting from robust demand for air travel that helped boost balance sheets after a prolonged period of restrictions during the pandemic. EasyJet Plc said a week ago that it continues to see strong booking momentum into the winter, and US carriers have benefited from a surge in overseas flights.
Still, concerns are mounting about the longer-term sustainability of demand as consumers struggle amid spiraling inflation and mortgage costs. Ryanair Holdings Plc on Monday lowered its full-year traffic prediction and said it would consider cutting ticket prices to fill seats this winter as passengers become more cost-sensitive.
The airline group expects to be at 95% capacity this year versus 2019 levels, and return to pre-pandemic levels as of 2024. At the Dutch KLM subsidiary, operations have “stabilized” in spite of supply chain snags, a tight labor market and fleet issues, the company said.
The company also said it entered exclusive talks with Apollo Global Management over a potential €1.5 billion financing for its loyalty program.
