Air France-KLM reported ‘the highest revenue in its history’ in 2023, up 14 per cent year-on-year to €30 billion, with an operating profit of €1.7 billion for the full year.
The airline group, however, suffered losses in the fourth quarter due to higher costs and disruptions caused by the ongoing conflict in Gaza.
While revenues for the quarter were up 6.7 per cent year-on-year and both capacity and passenger yield increased (6 per cent and 3.2 per cent, respectively), the operating result for the quarter was €190 million below the same period in 2022, at -€56 million.
The airline group expects Q1 2024 to be similarly impacted by “operational disruptions”, even after Air France resumed flights to Tel Aviv on 24 January.
In Q4, Air France-KLM welcomed 22.3 million passengers, 6.4 per cent above the previous year. Capacity and traffic also grew by 6 per cent and 5.3 per cent, respectively. Group-wide passenger unit revenue per available seat kilometres (ASK) was up 2.8 per cent, largely driven by an increase in yield across all long-haul geographies and short and medium-haul routes.
Both Air France and KLM reported ‘strong profitability’ for the full year in 2023. Air France posted a €1.1 billion profit for the full year, €602 million euros higher than last year, after a boost in long-haul traffic saw revenue increase by 13.7 per cent year-on-year.
KLM, meanwhile, saw revenue increase 12.8 per cent year-on-year on the back of ‘improved operations’. However, ongoing supply chain issues and ‘capacity constraints’ resulted in a drop in profit to €650 million (€56 million less than 2022) and a lower operating margin of 5.4 per cent.
Overall, the group saw passenger numbers increase 11 per cent year-on-year to 72.1 million and full-year capacity measured in ASKs increased 8.8 per cent. Load factor for the full year also improved by 3.2 points to 87 per cent and passenger revenues increased 20 per cent to €22.6 billion.
For the first quarter 2024, the airline group expects a 4 per cent rise in unit cost due to ‘the continuation of high disruption cost’ in the first two months of the year and a one-time payment of 2 per cent of the yearly salary to ground staff as part of a recent collective bargaining agreement.
Group CEO, Benjamin Smith, said:
“In 2023, we delivered on our commitment to strong operational and financial performance,
while also maintaining our position as a benchmark airline group for sustainability. Among our
major achievements, we can be satisfied of our efforts to further strengthen our balance sheet
and restore the Group’s equity.
"We also placed a historic order for 50 Airbus A350s with
purchase rights for 40 additional aircraft, thereby accelerating our fleet’s renewal with latest-generation aircraft that offer improved fuel efficiency, lower CO2 and noise emissions and an
enhanced experience for our customers," he added.