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PARIS: Air France-KLM said yesterday that its net loss deepened by nearly 50 percent last year to ¤1.2bn ($1.59bn) as it began restructuring to cope with the rise of low-cost airlines.
However the airline group said that underlying prospects were improving despite heavy fuel and restructuring costs, with its operating loss narrowing to ¤300m from ¤353m in 2011. This was better than the average figure expected by analysts polled by Bloomberg financial agency of a loss of ¤334.6m.
In the fourth quarter of last year, the operating loss was reduced to ¤143m from ¤202m 12 months earlier. Sales rose by 5.2 percent in 2012 to ¤25.6bn. The load factor, the percentage of seats occupied, rose by 1.2 points to a record 83.1 percent.
Financial director Philippe Calavia said that 2012 was an important year for the group because decisions about the structure and transformation of the company had been taken.
Air France-KLM has suffered from a fall of competitiveness in recent years, under the pressure of low-cost operators and the rise of airlines in the Middle East and in Asia. In January of last year, the company announced a vast restructuring plan called “Transform 2015”.
It booked provisions of ¤471m under this plan to cover expenses related to cutting its workforce in order to boost productivity.
Last year some 3,300 out 100,000 staff voluntarily left the airline group and most were not replaced, said AirFrance-KLM. The plan targets 5,122 voluntary departures this year. AFP