Air France post first yearly loss in 13 years

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Europe’s largest airline, the Air France-KLM Group, has posted its first full-year loss in 13 years, and warned that it is not likely to achieve a profit in the current 12-month period, as the recession continues to drive down passenger traffic.

The carrier’s net loss for its year ended 31 March amounted to 578 million euros, as compared with a net income of 790 million euros for the previous financial year, according to a statement released by Paris-based Air France on Wednesday.

Analysts had predicted a wider loss, however, of 902 million euros.

On 25 March, the International Air Transport Association (IATA) said that airlines globally stood to lose $4.7 billion in 2009, which is nearly 90 percent more than was forecast earlier.

Air France saw a 5.8 per cent decline of passenger traffic in first three months of 2009 – a more rapid pace than the carrier could compensate for by capacity reductions.

“Trading conditions in the first half remain challenging and visibility for the second half is still low,” said Pierre-Henri Gourgeon, the airline’s CEO, during a Paris briefing. He added that while there have been “some signs of stabilization in recent weeks,” Air France will likely experience an operating loss for this year as well.

The airline’s fourth quarter net loss amounted to 505 million euros, as compared with 534 million euros for the same quarter one year earlier. In a Bloomberg survey, analysts had predicted that the loss would amount to 589 million euros.

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