Coronavirus crisis heavily impacts Air France-KLM 2020 results

Air France-KLM

Air France-KLM unsurprisingly has suffered over 2020 as a result of the pandemic. For the year ending December 31, 2020, total revenue was reported at €11.1bn, down 59% compared to last year. EBITDA loss was at -€1.7bn, limited due to cost control. Net income fell by €7.4bn to -€7.1bn. Since the beginning of the crisis, Air France, KLM and Transavia proceeded €2.3bn of refunds to customers, with €0.8bn during the fourth quarter of 2020. Cargo was down by 20.8% at 880,000 tonnes. 

The 2020 Cargo capacity of the group has been down 30.7%, primarily driven by the reduction in belly capacity of passenger aircraft, partly offset by the increase of the full freighters’ capacity and mini cargo flights (passenger aircraft with only belly capacity commercialized). The yield and load factors were strongly up, resulting in a unit revenue increase of 76.8% at constant currency, thanks to the gap between industry capacity and demand. The group benefited from a full freighter fleet of six aircraft and a passenger long-haul fleet well suited for the cargo activity (Boeing 777, Boeing 787, and Airbus 350).

On the demand side, world-wide air freight volumes are down due to the Covid-19 crisis but are expecting to recover consistently with trade growth and industrial production. The supply-demand gap of the past months is foreseen to narrow once industry capacity supply will increase which depends on the passenger traffic recovery. Air France-KLM is ready to transport the Covid-19 vaccines worldwide and has already delivered them to several destinations successfully. The volumes will gradually increase during the first half of 2021.

After a positive Christmas traffic in Domestic France and to the Caribbean and the Indian Ocean, travel restrictions were tightened in France, the Netherlands and worldwide, having a negative impact on the traffic of the group in the first quarter of 2021. The group plans to progressively ramp up capacity towards summer 2021 and expects a recovery in the second and third quarter of 2021 thanks to the vaccine deployment.

Source: Air France-KLM

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