Air France-KLM flew a record 57.7 million passengers in the first nine months of the year showing few signs of the economic gloom that has hit demand for flights at rival carriers.
The airline, which is in exclusive talks to buy Alitalia, said that traffic rose by 1.9 per cent in the third quarter, despite a cabin crew strike this autumn. Operating income was also 17.9 per cent higher than at the same time last year.
There were few signs of a slow-down in air travel in the airline’s third quarter results statement, although the company did report aggressive competition in the cargo market and ever higher oil prices.
The airline reported a higher than expected operating profit for the third quarter, up 23 per cent at €311 million. Sales grew 3.9 per cent to €5.976 billion ($8.70 billion).
However, the world’s largest airline by revenues posted a below-forecast net profit for the three months to December 31. Net profit was 39 per cent below the previous year’s figure - when Air France-KLM benefitted from a one-off tax credit - at €139 million.
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The rise in operating income came despite an Air France cabin crew strike which capped passenger traffic growth to 1.9 per cent in the airline’s third quarter.
Analysts are studying airlines for any signs of an economic downturn feeding through into cyclical airline profits. Ryanair, the low-cost airline, gave a shock profits warning 10 days ago when it posted a 27 per cent fall in third quarter net profit and gave warning of poor market conditions in the next financial year.
Also earlier this month British Airways’s shares were hit when it said that rising fuel prices would remain a challenge throughout the year.
If a deal between Air France-KLM and Alitalia is struck, Air France would further strengthen its position as the world’s largest airline by revenues.
Air France-KLM has targeted a return on capital of 7 per cent for the financial year ending March 31. Jean-Cyril Spinetta, chief executive, has said an Alitalia deal could increase that to 8.5 per cent by 2010.