Air France-KLM Group‘s solid performance in Q3 2023 resulted in a record €1.3bn operating profit, with an operating margin of 15.5% driven by strong summer demand.
Air France-KLM Group Q3 Highlights
- Group capacity at 94% compared to 2019, with load factor at 90%
- Group revenues at €8.7bn, up 7% compared to last year
- Operating result at €1.3bn with an operating margin at 15.5%
- Adjusted operating free cash flow at -€0.4bn driven by seasonal reversal of working capital and cash at hand at €10.2bn (including RCF)
- Net debt down by €1.3bn compared to the end of 2022, leading to a Net debt/EBITDA ratio of 1.1x
- Net income at €0.9bn, up €0.5bn compared to last year and further supporting equity restoration
- Post-quarter events:
- Air France-KLM to take up to a maximum 19.9% non-controlling stake in the share capital of the reorganized SAS AB, subject to approvals and conditions.
- Air France-KLM signed a definitive agreement for a quasi-equity financing for €1.3 billion, with a potential upsize of €1.5 billion.
Comments From Air France-KLM Group CEO
Commenting on the results, Mr. Benjamin Smith, Group CEO, said:
“Air France-KLM delivered a solid quarter, marked by remarkable results. This performance was driven by strong summer demand. I would like to thank all our teams for their unfailing commitment during the season. Throughout the quarter, we also made significant progress on our sustainable strategic roadmap. Our landmark order for 50 Airbus A350 aircraft will significantly accelerate the renewal of our long-haul fleet, with more fuel-efficient, cost-effective and quieter aircraft. This new order represents a multi-billion investment to our sustainability roadmap, coming on top of previous orders for new generation widebody and narrowbody aircraft, and is complementary to our Sustainable Aviation Fuel commitments. It confirms our ambition to reach 64% of next-generation aircraft by 2028 and is another major step towards our target of reducing our CO2 emissions per passenger kilometer by 30% by 2030. We have also continued our efforts to further restore our equity, while leveraging the value of the Group’s assets, as illustrated by a non-dilutive financing agreement of our Flying Blue Loyalty program. Finally, we initiated a process to acquire up to 19.9% in SAS, with an option to increase our share after two years. By investing in SAS, we intend to enhance our offer and connectivity in the Nordics.”
Table of contents
- Air France-KLM Group Q3 Highlights
- Comments From Air France-KLM Group CEO
- Strong summer demand resulting in a record operating profit in Q3
- Passenger unit revenue driving the group unit revenue increase
- Strong Group Passenger Unit Revenue
- Equity restoration: Air France-KLM and Apollo Global Management sign a definitive agreement for a quasi-equity financing for €1.3 billion, with a potential upsize to €1.5 billion
- Air France-KLM to team up with SAS AB through equity and commercial cooperation
- Air France-KLM launches a global employee share purchase plan.
- Air France-KLM reverse share split and capital reduction.
- Air France-KLM 2023 Outlook Unchanged
- Business review
- Network: Operating result more than doubled
- Robust growth in unit revenue
- Air France-KLM Group Performance Trends by Region
- Cargo: continued normalization of the activity translating into a decrease in unit revenues
- Transavia: Load factor up while capacity growth of 14%
- Maintenance business: Operating margin above last year
- Air France-KLM Airbus Deal for A350 Component Support
- Air France-KLM Fleet
- Strong profitability for both airlines
- Income Statement
- Consolidated balance sheet
- Liabilities and Equity
- Consolidated Cash Flows January 1 – September 30
- Return on capital employed (ROCE)
- Net debt
- Adjusted Operating Free Cash Flow
- Bridge from EBITDA to Self-financing capacity
- Unit cost: net cost per ASK
- Air France-KLM Group Fleet as of 30 September
- Air France-KLM Q3 2023 Traffic
- Transavia Activity Q3
- Air France- KLM Total Group Passengers Q3
- Air France-KLM Total Group Cargo Q3
- Air France Activity
- KLM Activity
Strong summer demand resulting in a record operating profit in Q3
| Current quarter | Year to date | |
|---|---|---|
| 2023 | change | |
| Revenues (€m) | 8,660 | +6.8% |
| EBITDA (€m) | 1,993 | 316 |
| Operating result (€m) | 1,342 | 318 |
| Operating margin (%) | 15.5 % | +2.9pt |
| Net income – Group part (€m) | 931 | 471 |
| Adj. operating free cash flow (€m) | (434) | (724) |
| 30 Sep 2023 | 31 Dec 2022 | |
| — | — | — |
| Net Debt | 5,002 | 6,337 |
| EBITDA trailing 12 months | 4,393 | 3,615 |
| Net Debt/EBITDA ratio | 1.1x | 1.8x |
| In the third quarter, revenues were up +8.9% at a constant currency compared to Q3 2022, driven by a strong summer demand. The operating result rose by €318 million, supported by a combination of an increase in capacity (+6%), a higher passenger load factor (+1.3 pt), and a continued high passenger yield (+1.8%). This strong performance enabled the Group to offset the decrease in Cargo revenues and inflation. Consequently, the operating margin stood at 15.5%, a significant improvement of +2.9pt compared to last year. |
Net income stood at €931 million, up by €471 million, further supporting the equity restoration.
The adjusted operating free cash flow decreased to -€434 million due to seasonality in the ticket sales. The net debt ended at €5.0 billion, an improvement of €1.3 billion compared to year-end 2022.
Passenger unit revenue driving the group unit revenue increase
| Current quarter | Year to date | |
|---|---|---|
| 2023 | change | |
| Passengers (thousands) | 26,904 | +7.6% |
| Capacity (ASK m) | 84,754 | +6.0% |
| Traffic (RPK m) | 76,025 | +7.6% |
| Passenger load factor | 89.7% | +1.3pt |
| Passenger unit revenue per ASK (€ cts) | 8.87 | +3.3% |
| Group unit revenue per ASK (€ cts) | 9.39 | -1.1% |
| Group unit cost per ASK (€ cts) at constant fuel1 | 7.80 | -4.9% |
| In the third quarter of 2023, Air France-KLM welcomed 26.9 million passengers, 7.6% above the previous year. As capacity increased by 6.0% and traffic grew by 7.6%, the load factor increased by 1.3 points compared to last year. |
Strong Group Passenger Unit Revenue
The Group achieved strong revenue growth per passenger, with a 3.3% increase compared to last year. This was mainly due to higher load factors on our flights and increased fares on certain routes.
Regarding costs, the Group’s expenses per available seat kilometer (ASK) increased by 3.6% when excluding fuel costs and adjusting for currency fluctuations. However, this is an improvement compared to Q2 2023. Higher salaries primarily drove the increase in costs. The Group partly offset this with improved productivity, profit sharing, and lower flight-related expenses.
Looking ahead, the Group expects the year-over-year increase in costs to decrease in the fourth quarter, and our overall forecast remains a low-single-digit increase.
Equity restoration: Air France-KLM and Apollo Global Management sign a definitive agreement for a quasi-equity financing for €1.3 billion, with a potential upsize to €1.5 billion
Air France-KLM and Apollo Global Management announced a €1.3 billion financing agreement on October 26, 2023. Apollo-managed funds will provide the funds with an option to increase it to €1.5 billion. This financing will be treated as quasi-equity under IFRS.
The agreement involves a dedicated operating affiliate of Air France-KLM. This affiliate will be responsible for the trademark and most commercial partner contracts of Air France and KLM’s joint loyalty program, Flying Blue. It will also become the exclusive issuer of miles for the airlines and their partners, helping to expand and enhance the growth of Flying Blue.
To facilitate this agreement, Apollo-managed funds will invest in perpetual bonds issued by the operating affiliate. This financing will be treated as equity under IFRS, and it will not dilute the existing shareholders’ ownership. The coupon rate for the bonds will be 6.4% for the first four years and can be redeemed at an overall financing cost of 6.75% on the first call date.
This financing arrangement is part of Air France-KLM’s efforts to strengthen its balance sheet and restore its IFRS equity. It will not impact the Flying Blue program or the ownership rights of Air France and KLM. Additionally, it will not affect the contracts of Air France, KLM, or Air France-KLM employees.
Air France-KLM to team up with SAS AB through equity and commercial cooperation
Air France-KLM recently announced its plan to acquire up to a 19.9% stake in SAS AB, Scandinavian Airlines. This investment aims to strengthen Air France-KLM’s presence in the Scandinavian market through closer collaboration between the airlines.
If all the necessary approvals and conditions are met, Air France-KLM, along with the Danish State, will invest $1.175 billion. This investment includes $475 million in common shares and $700 million in secured convertible bonds.
Air France-KLM’s contribution to the investment will be $144.5 million, with $109.5 million in common shares and $35 million in secured convertible bonds. Additionally, Air France-KLM can increase its stake and become a controlling shareholder in the future, subject to regulatory conditions and financial performance.
In addition to the investment, Air France-KLM plans to establish a commercial partnership with SAS AB, providing enhanced connectivity and access to Air France-KLM’s global network for Scandinavian customers. This collaboration would benefit both airlines and their respective customers.
Air France-KLM launches a global employee share purchase plan.
Air France-KLM recently introduced the “Partners for the Future” program, where eligible employees (about 95% of the workforce) from approximately 20 countries can purchase shares. This initiative aims to foster a stronger connection between the employees and the company by allowing them to have a long-term stake in the Group’s success. The shares will be issued as part of a capital increase, capped at 3% of Air France-KLM’s total share capital. This plan was approved during the Annual General Meeting on June 7, 2023, per resolutions 34 and 35.
Air France-KLM reverse share split and capital reduction.
Air France – KLM recently completed a reverse share split of all its outstanding shares. This decision was made by the Board of Directors at their meeting on July 4, 2023, and was approved during the Combined General Meeting on June 7, 2023. The company also acknowledged the reduction of the nominal value of each share.
These transactions result in:
- The exchange of 10 ordinary shares in the Company with a par value of €1 each for 1 new share with a par value of €1 (taking into account the simultaneous capital reduction reducing the par value of each new share from €10 to €1, i.e., a reduction of €9 per share allocated to the “share premium” account).
- The Company’s share capital stands at 257,053,613 euros divided into 257,053,613 shares (ISIN code FR001400J770) with a par value of 1 euro each.
Air France-KLM 2023 Outlook Unchanged
Capacity
The Group expects the capacity in Available Seat Kilometers for Air France-KLM Group, including Transavia at an index of:
- Above 95% for the fourth quarter of 2023
- Circa 95% for the Full Year 2023
All indices compared to the respective period of 2019.
Unit cost
The Group expects a low single-digit increase compared to 2022.
Capex
Full-year 2023 net capex is estimated at 3.0 billion euros.
Business review
Network: Operating result more than doubled
| Network | Current quarter | Year to date |
|---|---|---|
| 2023 | change | change constant currency |
| Traffic revenues (€m) | 6,919 | +3.4% |
| Total revenues (€m) | 7,199 | +4.2% |
| Operating result (€m) | 1,091 | +240 |
| Operating margin (%) | 15.2% | 2.9 pt |
| Compared to the third quarter of 2022, total revenues increased by +4.2% to €7,199 million. The operating result improved by €240 million and amounted to €1,091 million. The network passenger business drove the revenue increase while the Cargo revenues declined compared to the third quarter last year due to a further normalization of the market. |
Robust growth in unit revenue
| Passenger network | Current quarter | Year to date |
|---|---|---|
| 2023 | change | change constant currency |
| Passengers (thousands) | 19,836 | +4.5% |
| Capacity (ASK m) | 71,038 | +4.6% |
| Traffic (RPK m) | 63,523 | +6.0% |
| Load factor | 89.4% | 1.1pt |
| Total passenger revenues (€m) | 6,641 | +9.3% |
| Traffic passenger revenues (€m) | 6,480 | +8.5% |
| Unit revenue per ASK (€ cts) | 9.12 | +3.7% |
| Third quarter 2023 capacity in Available Seat Kilometers (ASK) was 4.6% higher than last year and at 89% of 2019 level, which aligns with the Group’s guidance provided during the second quarter 2023 results presentation (c.90% versus 2019). Higher traffic (+6.0%) than capacity growth has led to an increase in the load factor of 1.1 points, resulting in a total load factor of 89.4% while yield continued to rise (+4% against a constant currency). |
This performance had a positive impact on Unit revenue per ASK, which rose by 5.7% at a constant currency.
Air France-KLM Group Performance Trends by Region
During the third quarter, Air France-KLM observed the following trends by region:
North Atlantic
Demand recovery continued to be driven by Point of Origin North America. Yield increased by 6% at the same capacity and load factor level (91%). Corporate traffic stood at 80% of 2019 levels.
Latin America
Demand remained very strong over the summer, enabling the Group to maintain yield performance versus high summer 2022 reference on traffic growth +10% (on capacity +9%), reaching a load factor at 93%.
Asia & Middle East
Capacity in the third quarter has significantly increased versus 2022 by 49%, mainly driven by China and Japan. Nevertheless, this is still -33% below 2019 levels. Due to this significant increase in capacity, yield slightly decreased by -1% compared to last year (but still 39.5% above 2019 level). However, the load factor increased thanks to strong demand.
Caribbean & Indian Ocean
The third quarter continued to show capacity reductions compared to 2022 (-24%) due to the redeployment of the fleet to other long-haul areas and a high comparison basis in 2022. This lower capacity pushed the load factor up to 90%, and yield improved by 20%.
Africa
Despite the geopolitical situation in Niger, Mali, and Burkina Faso, the Group enjoyed continued strong traffic dynamics with load factor up 2 points compared to 2022. Robust yield at 4% above 2022.
Short and Medium-haul
Capacity increased by +3% with different dynamics: KLM Medium Haul is up +13% (impacted by operational issues last year). Air France Medium Haul is stable. Air France domestic is down -18%. The Group increased the yield +3% on the back of a stable load factor at 85%.
Cargo: continued normalization of the activity translating into a decrease in unit revenues
| Cargo business | Current quarter | Year to date |
|---|---|---|
| 2023 | change | change constant currency |
| Tons (thousands) | 218 | -2.1% |
| Capacity (ATK m) | 3,654 | +3.3% |
| Traffic (RTK m) | 1,636 | 0.1% |
| Load factor | 44.8% | -1.4pt |
| Total Cargo revenues (€m) | 558 | -32.8% |
| Traffic Cargo revenues (€m) | 439 | -39.1% |
| Unit revenue per ATK (€ cts) | 12.02 | -41.0% |
| Compared to last year, total revenues dropped by -32.8% (as a reminder, revenue decreased by -33.9% in Q2 2023). The traffic increased year over year by 0.1% on the back of strong demand in 2022. The load factor was -1.4 points below 2022 due to the increased belly capacity. The yield also declined, resulting in a decrease in unit revenue per Available Ton Kilometer of -38.9% at constant currency. The decrease in unit revenue per ATK at constant currency has stabilized compared to 2022 (Q3 2023: -38.9%; YTD 2023: -38.3%). |
The resumption of passenger travel resulted in an increase in Available Ton Kilometers of 3.3% versus the third quarter of 2022. Furthermore, some operational issues with the Group’s full freighters resulted in reduced South American operations to restore reliable operational performance for customers.
Transavia: Load factor up while capacity growth of 14%
| Transavia | Current quarter | Year to date |
|---|---|---|
| 2023 | change | 2023 |
| Passengers (thousands) | 7,068 | +17.4% |
| Capacity (ASK m) | 13,716 | +14.0% |
| Traffic (RPK m) | 12,502 | +16.9% |
| Load factor | 91.2% | +2.2pt |
| Total Passenger revenues (€m) | 1,014 | +18.6% |
| Unit revenue per ASK (€ cts) | 7.55 | +2.2% |
| Unit cost per ASK (€ cts) | 6.18 | (2.9)% |
| Operating result (€m) | 188 | +65 |
| The forward booking load factor for the fourth quarter of 2023 compared to last year is stable, and the first quarter of 2024 is at a higher level than the year before while capacity continues to grow. | ||
| The forward booking load factor for the fourth quarter of 2023 compared to last year is stable, and the first quarter of 2024 is at a higher level than the year before while capacity continues to grow. |
Maintenance business: Operating margin above last year
| Maintenance | Current quarter | Year to date |
|---|---|---|
| 2023 | change | change constant currency |
| Total revenues (€m) | 1,053 | +27.6% |
| Third party revenues (€m) | 437 | +27.7% |
| Operating result (€m) | 63 | 17 |
| Operating margin (%) | 6.0% | 0.4pt |
| Total revenues increased by 27.6% compared with the same quarter last year, while third-party revenues increased by 29.4% at constant currency, showing a robust recovery. |
The operating margin in the third quarter stood at 6.0%, which is 0.4 points higher than in 2022 and almost in line with 2019 levels (6.1%).
Air France-KLM Airbus Deal for A350 Component Support
Air France-KLM and Airbus entered exclusive negotiations to create a joint venture dedicated to Airbus A350 component support.
Air France-KLM and Airbus made an exciting announcement on September 4th, 2023. They have entered into exclusive negotiations regarding a long-term strategic partnership. The partnership aims to enhance support for Airbus A350 components, including supply chain management and repairs. Additionally, both parties plan to establish a shared-access pool of aircraft components worldwide.
To cement their collaboration, Air France and Airbus are considering a 50-50 joint venture. This venture would transfer aircraft component assets from both companies into the joint venture’s pool. By joining forces, Air France Industries KLM Engineering & Maintenance and Airbus aim to provide better maintenance services for the growing Airbus A350 fleet. With 1,000 aircraft on order and 550 currently in service worldwide, there is a need for enhanced capacity, a broader global presence, and the development of innovative solutions.
The goal is to finalize the terms of this strategic partnership by the first half of 2024, pending approval from relevant authorities. This collaboration is poised to bring exciting advancements in the aviation industry in the years to come.
Air France-KLM Fleet
Air France-KLM has been focusing on updating its fleet for improved performance and reduced environmental impact. In 2022, they added new aircraft such as the B787-10, A350-900, B737-800, A220-300, Embraer 195-E2, and Embraer 190. They also phased out older aircraft like the B737-700, A321, A320, A319, A318, and CRJ-1000. Overall, the fleet grew by 23 aircraft.
Looking ahead, Air France-KLM is committed to investing in new-generation aircraft to enhance their economic efficiency and lower CO2 emissions. They recently announced plans to order 50 Airbus A350 aircraft, with the option to purchase 40 more. These aircraft will be gradually delivered from 2026 to 2030, allowing flexibility in allocation based on market needs and regulations.
The new Airbus A350s will replace older planes like the Airbus A330 and Boeing 777, contributing to a more modern and environmentally friendly fleet. In addition to this order, Air France-KLM has already received 22 out of the 41 Airbus A350-900s it previously ordered for Air France. Moreover, they have also ordered 8 Airbus A350 Full Freighter versions to enhance their cargo fleet.
By renewing their fleet, Air France-KLM aims to immediately reduce CO2 and noise emissions, complementing their efforts in using sustainable aviation fuel and implementing eco-piloting techniques. Their long-term goal is to achieve a 30% reduction in CO2 emissions per passenger/km by 2030 compared to 2019 levels. Since the 2000s, the company has already achieved a 40% reduction in noise footprint, and they continue to collaborate with all stakeholders on improving their operations.
By 2028, Air France-KLM plans to have new-generation aircraft comprising 64% of its fleet, a significant increase from the 5% in 2019.
Strong profitability for both airlines
Air France Group
| Current quarter | Year to date | |
|---|---|---|
| 2023 | change | 2023 |
| Revenue (in €m) | 5,374 | +7.5% |
| EBITDA (in €m) | 1,209 | +201 |
| Operating result (in €m) | 806 | +236 |
| Operating margin (%) | 15.0% | +3.6pt |
| Air France’s performance stems from a strong performance long-haul, increasing revenue of +7.5%. Operating result is up +236 million euros compared to last year. |
KLM Group
| Current quarter | Year-to-date | |
|---|---|---|
| 2023 | change | 2023 |
| Revenue (in €m) | 3,425 | +5.9% |
| EBITDA (in €m) | 786 | +98 |
| Operating result (in €m) | 539 | +96 |
| Operating margin (%) | 15.7% | +2.0pt |
| KLM’s revenue grew by +5.9% on the back of improved operations, although not optimal yet, while operating margin stood at 15.7%, representing an improvement of +2.0pt compared to last year. |
Income Statement
| Current Quarter | Year to Date | |
|---|---|---|
| in € million | 2023 | 2022 |
| restated * | ||
| Revenues from ordinary activities | 8,660 | 8,112 |
| Aircraft fuel | (1,918) | (2,325) |
| Carbon emission | (57) | (33) |
| Chartering costs | (167) | (92) |
| Landing fees and air routes charges | (539) | (488) |
| Catering | (225) | (206) |
| Handling charges and other operating costs | (499) | (468) |
| Aircraft maintenance costs | (585) | (524) |
| Commercial and distribution costs | (268) | (257) |
| Other external expenses | (464) | (375) |
| Salaries and related costs | (2,146) | (1,897) |
| Taxes other than income taxes | (40) | (38) |
| Other income and expenses | 241 | 268 |
| EBITDA | 1,993 | 1,677 |
| Amortization, depreciation and provisions | (651) | (653) |
| Income from current operations | 1,342 | 1,024 |
| Sales of aircraft equipment | 5 | 6 |
| Other non-current income and expenses | (3) | (30) |
| Income from operating activities | 1,344 | 1,000 |
| Cost of financial debt | (148) | (139) |
| Income from cash & cash equivalent | 67 | 9 |
| Net cost of financial debt | (81) | (130) |
| Other financial income and expenses | (168) | (335) |
| Income before tax | 1,095 | 535 |
| Income taxes | (155) | (71) |
| Net income of consolidated companies | 940 | 464 |
| Share of profits (losses) of associates | 6 | 2 |
| Net Income for the period | 946 | 466 |
| Non-controlling interests | 15 | 6 |
| Net Income for the period – Equity holders | 931 | 460 |
| ** Restated figures include the change in accounting principles for CO2 quotas* |
Consolidated balance sheet
| Assets | September 30, 2023 | December 31, 2022 |
|---|---|---|
| (in € million) | Restated * | |
| Goodwill | 225 | 225 |
| Intangible assets | 1,106 | 1,127 |
| Flight equipment | 11,296 | 10,614 |
| Other property, plant and equipment | 1,379 | 1,375 |
| Right-of-use assets | 5,596 | 5,428 |
| Investments in equity associates | 127 | 120 |
| Pension assets | 71 | 39 |
| Other non-current financial assets | 1,392 | 1,184 |
| Non-current derivative financial assets | 222 | 262 |
| Deferred tax assets | 578 | 714 |
| Other non-current assets | 76 | 78 |
| Total non-current assets | 22,068 | 21,166 |
| Other current financial assets | 494 | 620 |
| Current derivative financial assets | 529 | 327 |
| Inventories | 799 | 723 |
| Trade receivables | 2,333 | 1,785 |
| Other current assets | 1,062 | 979 |
| Cash and cash equivalents | 6,481 | 6,626 |
| Assets held for sale | 82 | 79 |
| Total current assets | 11,780 | 11,139 |
| Total assets | 33,848 | 32,305 |
| ** Restated figures include the change in accounting principles for CO2 quotas* |
Liabilities and Equity
| Liabilities and equity | September 30, 2023 | December 31, 2022 |
|---|---|---|
| (in € million) | ||
| Issued capital | 257 | 2,571 |
| Additional paid-in capital | 7,531 | 5,217 |
| Treasury shares | (25) | (25) |
| Perpetual | 1,062 | 933 |
| Reserves and retained earnings | (10,414) | (11,700) |
| Equity attributable to equity holders of Air France-KLM | (1,589) | (3,004) |
| Perpetual | 1,006 | 510 |
| Reserves and retained earnings | 19 | 14 |
| Equity attributable Non-controlling interests | 1,025 | 524 |
| Total equity | (564) | (2,480) |
| Pension provisions | 1,647 | 1,634 |
| Non-current return obligation liabilities and provisions for leased aircrafts and other provisions | 4,089 | 4,149 |
| Non-current financial liabilities | 7,572 | 9,657 |
| Non-current lease debt | 3,339 | 3,318 |
| Non-current derivative financial liabilities | 11 | 21 |
| Deferred tax liabilities | 8 | 1 |
| Other non-current liabilities | 1,581 | 2,343 |
| Total non-current liabilities | 18,247 | 21,123 |
| Current return obligation liabilities and provisions for leased aircrafts and other provisions | 853 | 740 |
| Current financial liabilities | 1,490 | 896 |
| Current lease debt | 850 | 834 |
| Current derivative financial liabilities | 34 | 83 |
| Trade payables | 2,815 | 2,424 |
| Deferred revenue on ticket sales | 4,324 | 3,725 |
| Frequent flyer programs | 908 | 900 |
| Other current liabilities | 4,890 | 4,057 |
| Bank overdrafts | 1 | 3 |
| Total current liabilities | 16,165 | 13,662 |
| Total equity and liabilities | 33,848 | 32,305 |
Consolidated Cash Flows January 1 – September 30
| Period from January 1 to September 30 | 2023 | 2022 |
|---|---|---|
| (in € million) | restated * | |
| Net income | 1,221 | 240 |
| Amortization, depreciation and operating provisions | 1,839 | 1,770 |
| Financial provisions | 157 | 105 |
| Loss (gain) on disposals of tangible and intangible assets | (54) | (45) |
| Derivatives – non monetary result | (6) | (28) |
| Unrealized foreign exchange gains and losses, net | 24 | 523 |
| Share of (profits) losses of associates | (7) | – |
| Deferred taxes | 78 | (234) |
| Impairment | 2 | 19 |
| Other non-monetary items | (166) | (147) |
| Financial capacity | 3,088 | 2,203 |
| (Increase) / decrease in inventories | (81) | (119) |
| (Increase) / decrease in trade receivables | (491) | (431) |
| Increase / (decrease) in trade payables | 324 | 786 |
| Increase / (decrease) in advanced ticket sales | 608 | 1,489 |
| Change in other assets and liabilities | (13) | 548 |
| Change in working capital requirement | 347 | 2,273 |
| Net cash flow from operating activities | 3,435 | 4,476 |
| Acquisition of subsidiaries, of shares in non-controlled entities | (2) | (1) |
| Acquisition of warrants ⁽¹⁾ | (12) | – |
| Purchase of property plant and equipment and intangible assets | (2,280) | (2,048) |
| Proceeds on disposal of property plant and equipment and intangible assets | 276 | 678 |
| Dividends received | 3 | 1 |
| Decrease (increase) in net investments, more than 3 months | 112 | (240) |
| Net cash flow used in investing activities | (1,903) | (1,610) |
| Increase of equity | – | 1,551 |
| Cash and cash equivalents and bank overdrafts at the beginning of period | 2 | 3 |
| Payments to acquire treasury shares | (1) | – |
| Issuance of perpetual | 1,226 | 497 |
| Repayment on perpetual | (595) | (1,480) |
| Coupons on perpetual | (87) | (238) |
| Issuance of debt | 1,798 | 769 |
| Repayment on debt | (3,116) | (1,600) |
| Payments on lease debts | (625) | (653) |
| New loans | (298) | (177) |
| Repayment on loans | 127 | 16 |
| Dividends paid | (90) | – |
| Net cash flow from financing activities | (1,659) | (1,312) |
| Effect of exchange rate on cash and cash equivalents and bank overdrafts (net of cash acquired or sold) | (16) | 53 |
| Change in cash and cash equivalents and bank overdrafts | (143) | 1,607 |
| ** Restated figures include the change in accounting principles for CO2 quotas.* | 6,623 | 6,654 |
| Cash and cash equivalents and bank overdrafts at the end of the period | 6,480 | 8,261 |
| (1) Participation in warrants issue of GOL 26 September | ||
| (1) Participation to warrants issue of GOL 26 September |
Return on capital employed (ROCE)
| In € million | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 30, 2022 | Dec 31, 2021 |
|---|---|---|---|---|---|---|---|---|
| restated(2) | restated(2) | restated(1) (2) | restated(1) (2) | restated(1) (2) | restated(1) (2) | restated(1)(2) | ||
| Goodwill and intangible assets | 1,331 | 1,339 | 1,351 | 1,352 | 1,350 | 1,361 | 1,363 | 1,380 |
| Flight equipment | 11,296 | 10,957 | 10,954 | 10,614 | 10,298 | 10,521 | 10,537 | 10,466 |
| Other property, plant and equipment | 1,379 | 1,389 | 1,372 | 1,375 | 1,349 | 1,358 | 1,378 | 1,402 |
| Right of use assets | 5,596 | 5,480 | 5,304 | 5,428 | 5,536 | 5,439 | 5,205 | 5,148 |
| Investments in equity associates | 127 | 121 | 122 | 120 | 111 | 108 | 107 | 109 |
| Financial assets excluding marketable securities, accrued interests and financial deposits | 191 | 190 | 169 | 169 | 164 | 162 | 158 | 157 |
| Provisions, excluding pension, cargo litigation and restructuring | (4,481) | (4,248) | (4,255) | (4,347) | (4,792) | (4,473) | (4,240) | (4,180) |
| WCR (3) | (7,804) | (8,917) | (8,696) | (7,213) | (7,609) | (8,338) | (6,736) | (5,453) |
| Capital employed | 7,635 | 6,311 | 6,321 | 7,498 | 6,407 | 6,138 | 7,772 | 9,029 |
| Average capital employed (A) | 6,941 | 7,337 | ||||||
| Adjusted results from current operations | 1,902 | 1,234 | ||||||
| – Dividends received | (2) | – | ||||||
| – Share of profits (losses) of associates | 18 | (13) | ||||||
| – Normative income tax | (495) | (316) | ||||||
| Adjusted result from current operations after tax (B) | 1,423 | 905 | ||||||
| ROCE, trailing 12 months (B/A) | 20.5% | 12.3% | ||||||
| (1) Proforma figures include restatement related to change in accounting scheme of ETS quotas (see financial statements of the period). |
(2) Compared to previous periods, the working capital has been restated to exclude the report of social & fiscal charges granted consequently to Covid.
(3) Excluding the report of social & fiscal charges granted consequently to Covid.
Net debt
| (in € million) | September 30, 2023 | December 31, 2022 |
|---|---|---|
| Current and non-current financial liabilities | 9,062 | 10,553 |
| Current and non-current lease debt | 4,189 | 4,152 |
| Accrued interest | (98) | (127) |
| Deposits related to financial liabilities | (106) | (101) |
| Deposits related to lease debt | (100) | (99) |
| Derivatives impact on debt | (34) | (35) |
| Gross financial liabilities (I) | 12,913 | 14,343 |
| Cash and cash equivalents | 6,481 | 6,626 |
| Marketable securities > 3 months | 447 | 572 |
| Bonds | 984 | 811 |
| Bank overdrafts | (1) | (3) |
| Net cash (II) | 7,911 | 8,006 |
| Net debt (I-II) | 5,002 | 6,337 |
Adjusted Operating Free Cash Flow
| Current Quarter | Year to Date | |
|---|---|---|
| 2023 | 2022 | |
| (in € million) | **restated *** | |
| Net cash flow from operating activities | 589 | 890 |
| Purchase of property plant and equipment and intangible assets | (884) | (591) |
| Proceeds on disposal of property plant and equipment and intangible assets | 65 | 202 |
| Operating free cash flow | (230) | 501 |
| Payments on lease debts | (204) | (211) |
| Operating free cash flow adjusted | (434) | 290 |
| ** Restated figures include the change in accounting principles for CO2 quotas* |
Bridge from EBITDA to Self-financing capacity
| Current Quarter | Year to Date | |
|---|---|---|
| 2023 | 2022 | |
| (in € million) | **restated *** | |
| EBITDA | 1,993 | 1,677 |
| Provisions (risk and other) | (2) | (2) |
| Correction of spare parts inventory | (1) | – |
| Addition to pension provisions | 38 | 32 |
| Reversal to pension provisions (cash-out) | (19) | (18) |
| Sales of tangible and intangible assets (excluding aeronauticals) | (2) | (3) |
| Income from operating activities – cash impact | 2,007 | 1,686 |
| Restructuring costs | (26) | (49) |
| Other non-current income and expenses | (1) | (4) |
| Cost of financial liability | (149) | (146) |
| Financial income | 61 | 5 |
| Realized foreign exchanges gain/loss | (4) | (14) |
| Settlement of forwards derivatives – cash | (2) | – |
| Other financial charges & expenses – cash | (11) | (11) |
| Current income tax | (96) | (22) |
| Other elements | 5 | – |
| Self-financing capacity | 1,784 | 1,445 |
| ** Restated figures include the change in accounting principles for CO2 quotas* |
Unit cost: net cost per ASK
| Current Quarter | Year to date | |
|---|---|---|
| 2023 | 2022 | |
| Total operating expenses (in €m) | 7,316 | 7,088 |
| Total other revenues (in €m) | (704) | (529) |
| Net cost (in €m) | 6,612 | 6,559 |
| Capacity produced, reported in ASK | 84,754 | 79,937 |
| Net cost per ASK (in € cents per ASK) | 7.80 | 8.21 |
| Gross change | -4.9 % | |
| Currency effect on net costs (in €m) | (160) | |
| Change at constant currency | -2.5 % | |
| Fuel price effect (in €m) | (382) | |
| Net cost per ASK on a constant currency and constant fuel price (in € cents per ASK) | 7.80 | 7.53 |
| Change at constant currency and constant fuel price | 3.6 % | |
| Furlough | +13 | |
| 7.80 | 7.54 | |
| Change at constant currency and constant fuel price excluding furlough | 3.4% | |
Air France-KLM Group Fleet as of 30 September
| Aircraft type | AF (incl. HOP)3 | KL (incl. KLC & MP)4 | Transavia | Owned | Finance lease | Operating lease | Total | In operation | Change vs 31/12/22 |
|---|---|---|---|---|---|---|---|---|---|
| B777-300 | 43 | 16 | 20 | 15 | 24 | 59 | 59 | ||
| B777-200 | 18 | 15 | 28 | 1 | 4 | 33 | 33 | ||
| B787-9 | 10 | 13 | 4 | 7 | 12 | 23 | 23 | ||
| B787-10 | 10 | 2 | 8 | 10 | 10 | 3 | |||
| A380-800 | 4 | 2 | 1 | 1 | 4 | ||||
| A350-900 | 22 | 4 | 8 | 10 | 22 | 22 | 2 | ||
| A330-300 | 5 | 5 | 5 | 5 | |||||
| A330-200 | 15 | 6 | 11 | 10 | 21 | 21 | |||
| Total Long-Haul | 112 | 65 | 0 | 71 | 40 | 66 | 177 | 173 | 5 |
| B737-900 | 5 | 5 | 5 | 5 | |||||
| B737-800 | 31 | 111 | 34 | 8 | 100 | 142 | 141 | 16 | |
| B737-700 | 6 | 4 | 7 | 3 | 10 | 10 | |||
| A321 | 16 | 9 | 7 | 16 | 16 | -2 | |||
| A320 | 38 | 4 | 3 | 31 | 38 | 37 | -2 | ||
| A319 | 14 | 10 | 4 | 14 | 14 | -3 | |||
| A318 | 6 | 4 | 2 | 6 | 6 | -3 | |||
| A220-300 | 30 | 21 | 9 | 30 | 30 | 15 | |||
| Total Medium-Haul | 104 | 42 | 115 | 94 | 11 | 156 | 261 | 259 | 21 |
| Canadair Jet 1000 | 3 | 3 | 3 | ||||||
| Canadair Jet 700 | |||||||||
| Embraer 195 E2 | 18 | 18 | 18 | 18 | 4 | ||||
| Embraer 190 | 20 | 30 | 17 | 4 | 29 | 50 | 50 | 1 | |
| Embraer 175 | 17 | 3 | 14 | 17 | 17 | ||||
| Embraer 170 | 13 | 10 | 3 | 13 | 13 | ||||
| Total Regional | 36 | 65 | 0 | 33 | 18 | 50 | 101 | 98 | 5 |
| B747-400ERF | 3 | 3 | 3 | 3 | |||||
| B747-400BCF | 1 | 1 | 1 | 1 | |||||
| B777-F | 2 | 2 | 2 | 2 | |||||
| Total Cargo | 2 | 4 | 0 | 4 | 0 | 2 | 6 | 6 | 0 |
| Total | 254 | 176 | 115 | 202 | 69 | 274 | 545 | 536 | 31 |
Air France-KLM Q3 2023 Traffic
Passenger network activity
| Current quarter | Year to date | |
|---|---|---|
| Total network airlines | 2023 | 2022 |
| Passengers carried (‘000s) | 19,836 | 18,980 |
| Revenue pax-kilometers (m RPK) | 63,523 | 59,948 |
| Available seat-kilometers (m ASK) | 71,038 | 67,907 |
| Load factor (%) | 89% | 88% |
| Long-haul | ||
| Passengers carried (‘000s) | 6,936 | 6,623 |
| Revenue pax-kilometers (m RPK) | 51,517 | 48,324 |
| Available seat kilometers (m ASK) | 56,879 | 54,155 |
| Load factor (%) | 91% | 89% |
| North America | ||
| Passengers carried (‘000s) | 2,731 | 2,696 |
| Revenue pax-kilometers (m RPK) | 19,272 | 19,197 |
| Available seat-kilometers (m ASK) | 21,278 | 21,217 |
| Load factor (%) | 91% | 90% |
| Latin America | ||
| Passengers carried (‘000s) | 878 | 801 |
| Revenue pax-kilometers (m RPK) | 8,355 | 7,600 |
| Available seat-kilometers (m ASK) | 8,983 | 8,265 |
| Load factor (%) | 93% | 92% |
| Asia / Middle East | ||
| Passengers carried (‘000s) | 1,392 | 981 |
| Revenue pax-kilometers (m RPK) | 11,017 | 7,052 |
| Available seat kilometers (m ASK) | 12,245 | 8,243 |
| Load factor (%) | 90% | 86% |
| Africa | ||
| Passengers carried (‘000s) | 1,089 | 1,078 |
| Revenue pax-kilometers (m RPK) | 6,696 | 6,452 |
| Available seat-kilometers (m ASK) | 7,536 | 7,388 |
| Load factor (%) | 89% | 87% |
| Caribbean / Indian Ocean | ||
| Passengers carried (‘000s) | 846 | 1,067 |
| Revenue pax-kilometers (m RPK) | 6,177 | 8,022 |
| Available seat kilometers (m ASK) | 6,838 | 9,042 |
| Load factor (%) | 90% | 89% |
| Short and Medium-haul | ||
| Passengers carried (‘000s) | 12,900 | 12,357 |
| Revenue pax-kilometers (m RPK) | 12,005 | 11,624 |
| Available seat-kilometers (m ASK) | 14,159 | 13,753 |
| Load factor (%) | 85% | 85% |
Transavia Activity Q3
| Current quarter | Year to date | |
|---|---|---|
| Transavia | 2023 | 2022 |
| Passengers carried (‘000s) | 7,068 | 6,022 |
| Revenue seat-kilometers (m RSK) | 12,502 | 10,697 |
| Available seat-kilometers (m ASK) | 13,716 | 12,029 |
| Load factor (%) | 91% | 89% |
| Total Group passenger activity |
Air France- KLM Total Group Passengers Q3
| Current quarter | Year to date | |
|---|---|---|
| Total Group | 2023 | 2022 |
| Passengers carried (‘000s) | 26,904 | 25,002 |
| Revenue pax-kilometers (m RPK) | 76,025 | 70,645 |
| Available seat-kilometers (m ASK) | 84,754 | 79,937 |
| Load factor (%) | 90% | 88% |
| Cargo activity |
Air France-KLM Total Group Cargo Q3
| Current quarter | Year to date | |
|---|---|---|
| Cargo | 2023 | 2022 |
| Revenue tonne-km (m RTK) | 1,636 | 1,635 |
| Available tonne-km (m ATK) | 3,654 | 3,537 |
| Load factor (%) | 45% | 46% |
Air France Activity
| Current quarter | Year to date | |
|---|---|---|
| Total Passenger network activity | 2023 | 2022 |
| Passengers carried (‘000s) | 11,455 | 11,528 |
| Revenue pax-kilometers (m RPK) | 38,686 | 36,159 |
| Available seat-kilometers (m ASK) | 43,379 | 40,992 |
| Load factor (%) | 89% | 88% |
| Long-haul | ||
| Passengers carried (‘000s) | 4,382 | 4,115 |
| Revenue pax-kilometers (m RPK) | 31,853 | 29,056 |
| Available seat-kilometers (m ASK) | 35,350 | 32,657 |
| Load factor (%) | 90% | 89% |
| Short and Medium-haul | ||
| Passengers carried (‘000s) | 7,073 | 7,413 |
| Revenue pax-kilometers (m RPK) | 6,833 | 7,103 |
| Available seat-kilometers (m ASK) | 8,029 | 8,335 |
| Load factor (%) | 85% | 85% |
| Cargo activity | ||
| Revenue tonne-km (m RTK) | 818 | 834 |
| Available tonne-km (m ATK) | 2,101 | 2,025 |
| Load factor (%) | 39% | 41% |
KLM Activity
| Current quarter | Year to date | |
|---|---|---|
| Total Passenger network activity | 2023 | 2022 |
| Passengers carried (‘000s) | 8,380 | 7,452 |
| Revenue pax-kilometers (m RPK) | 24,836 | 23,789 |
| Available seat-kilometers (m ASK) | 27,660 | 26,916 |
| Load factor (%) | 90% | 88% |
| Long-haul | ||
| Passengers carried (‘000s) | 2,554 | 2,508 |
| Revenue pax-kilometers (m RPK) | 19,664 | 19,267 |
| Available seat-kilometers (m ASK) | 21,529 | 21,498 |
| Load factor (%) | 91% | 90% |
| Short and Medium-haul | ||
| Passengers carried (‘000s) | 5,827 | 4,944 |
| Revenue pax-kilometers (m RPK) | 5,172 | 4,522 |
| Available seat-kilometers (m ASK) | 6,131 | 5,418 |
| Load factor (%) | 84% | 83% |
| Cargo activity | ||
| Revenue tonne-km (m RTK) | 818 | 801 |
| Available tonne-km (m ATK) | 1,553 | 1,512 |
| Load factor (%) | 53% | 53% |
| 1 change is nominal and not corrected for fuel price | ||
| 2 against a constant fuel price, constant currency and excluding furlough contribution | ||
| 3 Excluding Transavia |