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Air France - KLM Third Quarter 2021 results

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October 29, 2021

THIRD QUARTER 2021
Continuing recovery in capacity generates strong revenue growth and
positive operating results for the first time since the start of the Covid-19 crisis,
Adjusted operating free cash flow positive at 278 million euros
thanks to EBITDA contribution

Third quarter:

  • Revenue at 4,567 million euros, up 2,043 million compared to last year

  • Operating result at 132 million euros, up 1,178 million euros compared to last year

  • EBITDA improved to 796 million euros, an increase of 1,238 million euros compared to last year

  • Strong performance of Transavia with an operational result of 105 million euros

  • Net income at -192 million euros, up 1,473 million euros compared to last year

  • Net debt at 8.1 billion euros, down by 2.9 billion euros compared to end of 2020 thanks to the first set of capital strengthening measures

OUTLOOK

After the announcement in September of the reopening of the United States for European citizens, bookings came quickly for November and even more for Christmas holiday. The reopening of Canada in early September was another important milestone for the recovery of the Group, as well as the reopening of Singapore as from October.

In this context, the Group expects capacity in Available Seat Kilometers for Air France-KLM Network passenger activity at index in the range of 70% to 75% in the Fourth quarter 2021 compared to 2019. EBITDA is expected to be positive in the Fourth quarter 2021 and slightly positive in Full Year 2021.

Due to the uncertainty regarding the reopening of the majority of the Asian countries, no capacity guidance will be provided for 2022.

Air France-KLM is considering the next steps of recapitalization measures to strengthen balance sheet. The reprofiling of the French Bank Loan “PGE”, the EMTN program (Euro Medium Term Note) which is now ready for use, and the finalization of a S&P solicited ESG rating tool, will be part of the liability management actions.
On the equity side, discussions are ongoing on KLM recapitalization measures on current shareholder loan and also on further capital strengthening measures for Air France-KLM. These could include instruments such as a Rights Issue and Quasi equity instruments.

Air France-KLM Group

Third quarter

Nine months

2021

Change1

2021

Change

Passengers (thousands)

16,940

+92.6%

28,787

+2.3%

Passenger Unit revenue per ASK2 (€ cts)

5.48

+36.9%

4.34

-12.5%

Operating result (€m)

132

+1,178

-1,800

+1,614

Net income – Group part (€m)

-192

+1,473

-3,161

+2,917

Adj. operating free cash flow (€m)

278

+1,498

-856

+2,691

Net debt at end of period3 (€m)

8,121

-2,928

The Board of Directors of Air France-KLM, chaired by Mrs Anne-Marie Couderc, met on October 28, 2021 to approve the financial statements for the first nine months of 2021. Group CEO Mr. Benjamin Smith said:
The Air France-KLM group had a good summer season thanks to the reopening of many countries. I would like to thank our employees who have enabled our customers to return to the skies in the best possible sanitary conditions. For the first time since the beginning of this Covid-19 crisis, the Q3 results show a positive operating result which encourages us to continue our efforts. The Covid-19 crisis is not yet over. Important continents such as Asia remain mainly closed and business travel is slowly recovering. This is why we must remain very agile and continue our transformation with the objective of improving both our economic and environmental performance. In this respect, the Air France-KLM Group has committed to setting greenhouse gas emission reduction targets in line with the Paris agreements and based on scientific data (through the science-based targets initiative). This new commitment comes in addition to our goal of zero net emissions by 2050.

Business review

Network: Recovery continued throughout the summer peak

Network

Third quarter

Nine months

2021

Change

Change
constant currency

2021

Change

Change
constant currency

Total revenues (€m)

3,791

+89.1%

+89.8%

8,011

+11.0%

+13.0%

Scheduled revenues (€m)

3,595

+93.7%

+94.4%

7,495

+11.0%

+13.3%

Operating result (€m)

-13

+976

+968

-1,728

+1,113

+1,095

Third quarter 2021 revenues increased by 89.8% at constant currency to 3,791 million euros. The operating result was close to break-even and amounted to -13 million euros, a 968 million euros increase at constant currency compared to last year.

Passenger network: All indicators showing positive results in the Third quarter

Third quarter

Nine months

Passenger network

2021

Change

Change
constant currency

2021

Change

Change
constant currency

Passengers (thousands)

12,694

+87.1%

23,015

-2.8%

Capacity (ASK m)

52,532

+63.7%

122,535

+18.7%

Traffic (RPK m)

34,019

+147.4%

63,382

-5.2%

Load factor

64.8%

+21.9 pt

51.7%

-13.0 pt

Total passenger revenues (€m)

2,956

+122.5%

+123.2%

5,443

-1.2%

+0.4%

Scheduled passenger revenues (€m)

2,866

+126.7%

+127.3%

5,223

-0.9%

+1.1%

Unit revenue per ASK (€ cts)

5.46

+38.5%

+38.9%

4.26

-16.5%

-14.8%

Third quarter 2021, the capacity in Available Seat Kilometers in the Third quarter was 63.7% higher than last year, however at 66% of 2019 Third quarter levels. Thanks to the Group’s balanced network, less travel restrictions, for instance the reopening of Canada in September and the continuation of strong Cargo performance, the passenger network was in the upper limit of the Group’s guidance provided during the Second quarter 2021 results presentation.

On most routes, the Group observed a decrease in unit revenue versus 2019 mainly due to lower load factors, while yields are close to 2019 levels for the entire passenger activity.

  • North Atlantic peak summer has shown strong increase compared to June driven by the U.S point of sales. The Group also observes good performance on Mexican routes and in Canada after the lifting of border restrictions.

  • On Caribbean and Indian Ocean, the Group posted a good performance despite sanitary restrictions on the French Antilles affecting especially September results.

  • Africa performance was driven by West and Central African countries with yield on Africa above 2019 for Air France due to the limited industry capacity and benefiting from positive traffic mix.

  • Asia capacity and traffic were still weak for both airlines due to the closure of almost all Asian countries.

  • South American routes showed mixed results with a start of recovery driven by Andean and Central Americas

  • The group posted encouraging short and medium-haul results in the peak summer driven by over-performing local leisure flows with same yield as 2019. Capacity redeployment to leisure areas and seasonal route openings enabled to leverage all leisure traffic opportunities. September confirms recovery of business motive traffic with stabilization of yield not far from 2019 levels.

During the Third quarter, Air France added one Airbus 350-900 to the fleet and received its first Airbus A220-300, KLM phased out two B737-700 and HOP decreased its aircraft in operation with two Canadair Jet 1000 and one Canadair Jet 700.

Cargo: High yield compensating the lower load factor in the Third quarter due to increase in capacity

Third quarter

Nine months

Cargo business

2021

Change

Change
constant currency

2021

Change

Change
constant currency

Tons (thousands)

247

+12.5%

789

+28.9%

Capacity (ATK m)

3,052

+20.3%

8,363

+14.4%

Traffic (RTK m)

1,889

+8.9%

6,055

+27.6%

Load factor

61.9%

-6.5 pt

72.4%

+7.5 pt

Total Cargo revenues (€m)

835

+23.4%

+24.1%

2,568

+50.3%

+53.9%

Scheduled cargo revenues (€m)

729

+23.1%

+23.7%

2,272

+53.3%

+56.8%

Unit revenue per ATK (€ cts )

23.89

+2.3%

+2.9%

27.17

+34.0%

+37.0%

Compared to the third quarter in 2020, capacity increased by 20.3% in Available Ton Kilometers and traffic increased by 8.9%. Additional belly capacity to leisure destinations could not be filled completely resulting in a reduction in load factor by 6.5 points. Thanks to an increase in yield, which compensated the reduction in load factor, the unit revenue per ATK at constant currency improved by 2.9%.
Cargo capacity this quarter is still 20% below the capacity in the Third quarter of 2019 while the demand remains high resulting in high revenues.

Strong demand is expected on Q4 as global trade is booming, sea freight faces bottleneck, and the belly capacities are still constrained overall.

The Sustainable Aviation Fuel (SAF) Cargo program welcomed 25 partners already, showing the sustainable commitment of Air France-KLM Cargo and its partners.

Transavia: Reaching close to 80% load factor in the Third quarter with strong capacity development

Third quarter

Nine months

Transavia

2021

Change

2021

Change

Passengers (thousands)

4,246

+110.8%

5,772

+29.6%

Capacity (ASK m)

9,393

+56.3%

13,645

+22.1%

Traffic (RPK m)

7,359

+90.2%

9,881

+16.2%

Load factor

78.3%

+14.0 pt

72.4%

-3.7 pt

Total passenger revenues (€m)

522

+99.3%

685

+31.5%

Unit revenue per ASK (€ cts)

5.59

+27.7%

5.04

+11.0%

Unit cost per ASK (€ cts)

4.47

-3.0%

5.87

-8.2%

Operating result (€m)

105

+119

-113

+94

The third quarter of 2021 showed a strong recovery in demand for leisure traffic in Europe, both from the Netherlands as well as France. With activity levels back to around 85% of the regular production, Transavia realized an Operating Profit of €105mln, with a healthy COI margin of 20,2%, moving towards Q3 2019 level of 26%.

Compared to last year, the capacity increased by 56.3% while traffic increased by 90.2% and the number of passengers more than doubled at an increase of 110.8%.

Transavia was able to continuously adjust and redesign the network to accommodate high leisure demand from both the Netherlands and France, with an increase of capacity to Greece, Spain and Portugal.

In the first nine months of 2021, the number of aircraft of Transavia France increased by ten as part of the growth strategy for Transavia France and will reach 61 aircraft in Summer 2022.

Maintenance business: Operating result positive for the Third quarter 2021

Third quarter

Nine months

Maintenance

2021

Change

Change
constant currency

2021

Change

Change
constant currency

Total revenues (€m)

703

+14.2%

2,005

-11.1%

Third-party revenues (€m)

247

0.0%

+3.0%

761

-21.0%

-12.5%

Operating result (€m)

29

74

76

19

386

405

Operating margin (%)

4.1%

+11.5 pt

+11.9 pt

1.0%

+17.2 pt

+18.9 pt

The Third quarter operating result stood at 29 million euros, an increase of 76 million euros at constant currency versus the Third quarter 2020.

The operating result increase in the Third quarter is mainly explained by less underactivity, costs control, savings and operational improvement.

Total revenues increased by 14.2% in the Third quarter while third party revenues remained stable and internal revenues increased by 24%. This increase in internal revenues is aligned with the activity increase of the Air France-KLM airlines compared to the third quarter 2020. Both internal and third party engines revenues are impacted by green time usage. Nevertheless, some recovery signs are there and E&M business should increase its external activity over the coming months.

Air France-KLM Group: Positive Operating result in the Third quarter for the first time since the start of the Covid-19 crisis

Third quarter

Nine months

2021

Change

Change
constant currency

2021

Change

Change
constant currency

Capacity (ASK m)

61,925

+62.5%

136,179

+19.0%

Traffic (RPK m)

41,378

+134.8%

73,262

-2.8%

Passenger unit revenue per ASK (€ cts)

5.48

+36.6%

+36.9%

4.34

-14.0%

-12.5%

Group unit revenue per ASK (€ cts)

6.65

+19.6%

+20.0%

6.01

-5.3%

-3.5%

Group unit cost per ASK (€ cts) at constant fuel

6.44

-22.5%

-24.4%

7.33

-21.4%

-19.7%

Revenues (€m)

4,567

+80.9%

+82.0%

9,477

+8.6%

+11.5%

EBITDA (€m)

796

1,238

1,232

-78

1,204

1,204

Operating result (€m)

132

1,178

1,172

-1,800

1,614

1,613

Operating margin (%)

2.9%

+44.3 pt

+44.3 pt

-19.0%

+20.1 pt

+21.2 pt

Net income - Group part (€m)

-192

+1,473

-3,161

+2,917

In the Third quarter 2021, the Air France-KLM Group posted a positive operating result of 132 million euros, up by 1,178 million euros compared to last year driven by an increase of capacity leading to a reduction in unit cost. In parallel increase of load factor generated an increase of the unit revenue.

Net income amounted to -192 million euros in the Third quarter 2021, an increase of 1,473 million euros compared to last year. Last year Third quarter was heavily impacted by the recording of exceptional accounting items due to Covid-19 (mainly due to restructuring costs provision for Air France staff, HOP staff and Air France-KLM international commercial staff, but as well due to fleet impairment and fuel over hedge).

Third quarter 2021 unit cost decreased by 24%, thanks to an increase of capacity and FTE reductions

On a constant currency and fuel price basis, unit costs were down 24.4% in the third quarter 2021 compared to the same quarter last year.

All cost items increased in the Third quarter 2021 compared to last year due to an increase in capacity of 62.5%.
Group net employee cost were up 8.7% due to less government support driven by higher activity, and partly compensated by FTE reductions.

Third quarter: Adjusted Operating Free cash flow positive driven by Cash Flow from Operations

Third quarter

Nine months

In € million

2021

Change

2021

Change

Cash flow before change in WCR and Voluntary Departure Plans, continuing operations (€m)

671

+1,396

-491

+1,572

Cash out related to Voluntary Departure Plans (€m)

-93

-87

-218

-203

Change in Working Capital Requirement (WCR) (€m)

242

+118

1,361

+695

Net cash flow from operating activities (€m)

820

1,427

652

2,064

Net investments* (€m)

-321

+41

-854

+619

Operating free cash flow (€m)

499

1,468

-202

2,683

Repayment of lease debt

-221

+30

-654

+8

Adjusted operating free cash flow**

278

1,498

-856

2,691

* Sum of ‘Purchase of property, plant and equipment and intangible assets’ and ‘Proceeds on disposal of property, plant and equipment and intangible assets’ as presented in the consolidated cash flow statement.

** The “Adjusted operating free cash flowis operating free cash flow after deducting the repayment of lease debt.

The Group generated adjusted operating free cash flow in the Third quarter 2021 of 278 million euros, an increase of 1,498 million euros compared to last year, mainly driven by a positive EBITDA of 796 million euros.

In million

30 Sep 2021

31 Dec 2020

Net debt

8,121

11,049

EBITDA trailing 12 months

-485

-1,689

Net debt/EBITDA trailing 12 months

na

na

Q3: Both airlines performing significantly better than last year

Third quarter

Nine months

2021

Change

2021

Change

Air France Group Operating result (€m)

-45

+762

-1,451

+950

Operating margin (%)

-1.6%

+52.5 pt

-25.0%

+22.3 pt

KLM Group Operating result (€m)

168

+402

-354

+649

Operating margin (%)

8.9%

+29.4 pt

-8.8%

+16.4 pt

OUTLOOK

After the announcement in September of the reopening of the United States for European citizens, bookings came quickly for November and even more for Christmas holiday. The reopening of Canada early September was another important milestone for the recovery of the Group, as well as the reopening of Singapore as from October.

In this context, the Group expects capacity in Available Seat Kilometers for Air France-KLM Network passenger activity at an index in the range of 70% to 75% in the Fourth quarter 2021 compared to 2019.

Due to the uncertainty of the reopening of the majority of the Asian countries no capacity guidance will be provided for 2022.

As of September 30 2021, the Group has 10.4 billion euros of liquidity and credit lines at disposal. This level can be considered sufficient, given the continuation of recovery throughout the summer. Cash requirements for 2021, will include:

  • EBITDA is expected to be positive in the Fourth quarter 2021 and slightly positive in Full Year 2021

  • Net Capex spending expected at 1.5 billion euros in 2021

  • Restructuring cash out at 300 million euros in 2021

Air France-KLM is considering the next steps of recapitalization measures to strengthen balance sheet. The reprofiling of the French Bank Loan “PGE”, the EMTN program (Euro Medium Term Note) which is now ready for use, and the finalization of a S&P solicited ESG rating tool, will be part of the liability management actions.
On the equity side, discussions are ongoing on KLM recapitalization measures on current shareholder loan and also on further capital strengthening measures for Air France-KLM. These could include instruments such as a Rights Issue and Quasi equity instruments.

Air France-KLM receives a proactive and voluntary ESG Evaluation by Standard and Poor’s

Sustainability is a key element of the Group’s recovery strategy and an integral part of its structural transformation plan. Air France-KLM wants to lead the way towards responsible and sustainable aviation.

To this end, the Group has set itself ambitious targets to reduce its environmental footprint, deepen its social and societal contribution and set an example in terms of corporate governance.

To objectivize its ESG profile and enhance its strategy and practice, Air France-KLM proactively sought an independent ESG rating from Standard and Poor's.

This makes Air France-KLM the first airline Group to be evaluated by a solicited ESG rating.

S&P Global Ratings has assigned Air France-KLM an ESG Evaluation of 64/100.

With this rating, Air France-KLM compares well with the airline industry in terms of the management of its significant exposure to environmental challenges. S&P noted that the Group is adequately prepared to manage ESG related risks facing airlines over the near-to-medium term.

******

The results presentation is available at www.airfranceklm.com on October 29, 2021 from 7:15 am CET.

A conference call hosted by Mr. Smith (CEO) and Mr. Zaat (CFO) will be held on October 29, 2021 at 08.30 CET.

To connect to the conference call, please dial:

France: Local +33 (0)1 76 77 25 07
Netherlands: Local +31 (0)20 703 8259
UK: Local +44 (0)330 336 9434
US: Local +1 323-794-2597

Confirmation code: 2229449

Investor Relations Press
Olivier Gall Michiel Klinkers
+33 1 49 89 52 59 +33 1 49 89 52 60 +33 1 41 56 56 00
olgall@airfranceklm.com Michiel.klinkers@airfranceklm.com

Income Statement

Third quarter

Nine months

€m

2021

2020

Change

2021

2020

Change

Sales

4,567

2,524

+80.9%

9,477

8,725

+8.6%

Other revenues

0

0

nm

0

0

nm

Revenues

4,567

2,524

+80.9%

9,477

8,725

+8.6%

Aircraft fuel

-828

-489

+69.3%

-1,811

-1,886

-4.0%

Chartering costs

-85

-68

+25.0%

-232

-181

+28.2%

Landing fees and route charges

-374

-266

+40.6%

-835

-743

+12.4%

Catering

-124

-58

+113.8%

-250

-236

+5.9%

Handling charges and other operating costs

-307

-204

+50.5%

-710

-646

+9.9%

Aircraft maintenance costs

-389

-331

+17.5%

-1,181

-1,243

-5.0%

Commercial and distribution costs

-124

-61

+103.3%

-255

-291

-12.4%

Other external expenses

-292

-263

+11.0%

-839

-937

-10.5%

Salaries and related costs

-1,406

-1,293

+8.7%

-3,809

-4,224

-9.8%

Taxes other than income taxes

-30

-28

+7.1%

-100

-108

-7.4%

Other income and expenses

188

95

+97.9%

467

488

-4.3%

EBITDA

796

-442

nm

-78

-1,282

-93.9%

Amortization, depreciation and provisions

-664

-604

+9.9%

-1,722

-2,132

-19.2%

Income from current operations

132

-1,046

nm

-1,800

-3,414

-47.3%

Sales of aircraft equipment

-6

8

nm

-20

31

nm

Other non-current income and expenses

-54

-597

-91.0%

-906

-1,452

-38%

Income from operating activities

72

-1,635

nm

-2,726

-4,835

-43.6%

Cost of financial debt

-144

-136

+5.9%

-483

-350

+38.0%

Income from cash and cash equivalent

-1

5

nm

2

18

-88.9%

Net cost of financial debt

-145

-131

+10.7%

-481

-332

+44.9%

Other financial income and expenses

-114

111

nm

-199

-621

-68.0%

Income before tax

-187

-1,655

-88.7%

-3,406

-5,788

-41.2%

Income taxes

-7

12

nm

255

-242

nm

Net income of consolidated companies

-194

-1,643

-88.2%

-3,151

-6,030

-47.7%

Share of profits (losses) of associates

3

-22

nm

-13

-52

-75.0%

Net income for the period

-191

-1,665

-88.5%

-3,164

-6,082

-48.0%

Minority interest

-1

0

nm

-3

-4

-25%

Net income for the period – Group part

-192

-1,665

-88.5%

-3,161

-6,078

-48.0%

Consolidated Balance Sheet

Assets

30 Sep 2021

31 Dec 2020

€m

Goodwill

221

215

Intangible assets

1,234

1,230

Flight equipment

10,478

11,031

Other property, plant and equipment

1,418

1,548

Right-of-use assets

5,061

4,678

Investments in equity associates

172

230

Derivatives assets long term

148

92

Pension assets

0

211

Other financial assets

851

795

Deferred tax assets

264

282

Other non-current assets

1

4

Total non-current assets

19,848

20,316

Other short-term financial assets

495

607

Derivatives assets short term

484

160

Inventories

580

543

Trade receivables

1,621

1,248

Other current assets

970

914

Cash and cash equivalents

6,992

6,423

Total current assets

11,142

9,895

Total assets

30,990

30,211


Liabilities and equity

30 Sep 2021

31 Dec 2020

In million euros

Issued capital

643

429

Additional paid-in capital

4,949

4,139

Treasury shares

-25

-25

Perpetual

3,097

0

Reserves and retained earnings

-12,483

-9,970

Equity attributable to equity holders of Air France-KLM

-3,819

-5,427

Non-controlling interests

8

9

Total Equity

-3,811

-5,418

Pension provisions

2,163

2,147

Other provisions

4,223

3,670

Long-term debt

11,984

14,171

Lease financial debt

2,759

2,425

Derivatives liabilities long term

35

122

Deferred tax liabilities

5

22

Other non-current liabilities

2,727

1,294

Total non-current liabilities

23,896

23,851

Provisions

793

1,337

Current portion of long-term debt

832

1,318

Current portion of lease financial debt

801

839

Derivatives liabilities short term

36

363

Trade payables

1,875

1,435

Deferred revenue on ticket sales

2,548

2,394

Frequent flyer programs

899

916

Other current liabilities

3,119

3,175

Bank overdrafts

2

1

Total current liabilities

10,905

11,778

Total equity and liabilities

30,990

30,211

Statement of Consolidated Cash Flows from 1st January until 30 September 2021

€m

30 Sep 2021

30 Sep 2020

Net income from continuing operations

-3,164

-6,082

Amortization, depreciation and operating provisions

1,722

2,132

Financial provisions

89

135

Loss (gain) on disposals of tangible and intangible assets

18

-43

Loss (gain) on disposals of subsidiaries and associates

-25

1

Derivatives – non monetary result

-33

70

Unrealized foreign exchange gains and losses, net

172

-83

Impairment

37

670

Other non-monetary items

723

761

Share of (profits) losses of associates

13

52

Deferred taxes

-261

309

Financial Capacity

-709

-2,078

(Increase) / decrease in inventories

-47

134

(Increase) / decrease in trade receivables

-365

823

Increase / (decrease) in trade payables

415

-792

Increase / (decrease) in advanced ticket sales

142

-435

Change in other receivables and payables

1,216

936

Change in working capital requirements

1,361

666

Net cash flow from operating activities

652

-1,412

Purchase of property, plant and equipment and intangible assets

-1,543

-1,654

Proceeds on disposal of property, plant and equipment and intangible assets

689

181

Proceeds on disposal of subsidiaries, of shares in non-controlled entities

71

357

Acquisition of subsidiaries, of shares in non-controlled entities

-2

-1

Dividends received

2

0

Decrease (increase) in net investments, more than 3 months

37

-9

Net cash flow used in investing activities

-746

-1,126

Capital increase

1,026

0

Perpetual (including premium)

0

0

Issuance of debt

1,546

7,598

Repayment on financial debt

-1,323

-2,202

Payments on lease debt

-654

-662

Decrease (increase ) in loans, net

58

48

Dividends and coupons on perpetual paid

0

0

Net cash flow from financing activities

653

4,782

Effect of exchange rate on cash and cash equivalents and bank overdrafts

9

-39

Change in cash and cash equivalents and bank overdrafts

568

2,205

Cash and cash equivalents and bank overdrafts at beginning of period

6,422

3,711

Cash and cash equivalents and bank overdrafts at end of period

6,990

5,916

Change in treasury of discontinued operations

0

0

Return on capital employed (ROCE)

In million euros

30 Sep 2021

30 Jun 2021

31 Mar 2021

31 Dec 2020

30 Sep 2020

30 Jun 2020

31
Mar 2020

31 Dec 2019

Goodwill and intangible assets

1,456

1,464

1,479

1,445

1,470

1,500

1,564

1,522

Flight equipment

10,478

10,645

10,800

11,031

11,009

10,919

11,465

11,334

Other property, plant and equipment

1,418

1,453

1,476

1,548

1,535

1,551

1,579

1,580

Right of use assets

5,061

5,033

4,795

4,678

4,789

4,938

5,119

5,173

Investments in equity associates

172

166

223

230

224

267

299

307

Financial assets excluding marketable securities and financial deposits

147

147

146

146

135

133

142

140

Provisions, excluding pension, cargo litigation and restructuring

-4,180

-4,033

-4,083

-3,922

-4,002

-4,132

-4,191

-4,060

WCR, excluding market value of derivatives

-7,995

-7,745

-6,410

-6,505

-6,894

-6,779

-6,650

-6,310

Capital employed

6,557

7,130

8,426

8,651

8,266

8,397

9,327

9,686

Average capital employed (A)

7,691

8,919

Adjusted results from current operations

-2,934

-3,320

- Dividends received

0

-1

- Share of profits (losses) of associates

-19

-44

- Normative income tax

844

1,030

Adjusted result from current operations after tax (B)

-2,109

-2,335

ROCE, trailing 12 months (B/A)

-27.4%

-26.2%

Net debt

Balance sheet at

€m

30 Sep 2021

31 Dec 2020

Financial debt

12,719

15,388

Repo on triple A bonds

0

-84

Lease debt

3,474

3,184

Currency hedge on financial debt

-2

27

Accrued interest

-112

-107

Gross financial debt (A)

16,079

18,408

Cash and cash equivalents

6,992

6,423

Marketable securities

968

193

Cash securities

0

309

Bonds AAA

0

518

Bank overdrafts

-2

-1

Others

0

1

Repo on triple A bonds

0

-84

Net cash (B)

7,958

7,359

Net debt (A) – (B)

8,121

11,049

Adjusted operating free cash flow

Third quarter

Nine months

€m

2021

2020

2021

2020

Net cash flow from operating activities, continued operations

820

-607

652

-1,412

Investment in property, plant, equipment and intangible assets

-444

-370

-1,543

-1,654

Proceeds on disposal of property, plant, equipment and intangible assets

123

8

689

181

Operating free cash flow

499

-969

-202

-2,885

Payments on lease debt

-221

-251

-654

-662

Adjusted operating free cash flow

278

-1,220

-856

-3,547

Operating cash burn





Third quarter

Nine months

2021

2020

2021

2020

EBITDA

796

-442

-78

-1,282

Provisions (CO2 and other)

12

7

-16

-26

Correction of spare parts inventory

1

2

4

2

Addition to pension provisions

30

78

164

232

Reversal to pension provisions (cash-out)

-17

-47

-100

-142

Payment linked with shares

0

0

0

-2

Sales of tangible and intangible assets (excluding aeronautical)

0

-1

31

40

Income from operation activities - cash impact

822

-402

5

-1,177

Restructuring costs

-93

-137

-218

-152

Other non-current income and expenses

-3

0

-66

-1

Cost of financial debt

-138

-118

-440

-318

Financial income

-4

0

-11

2

Realized foreign exchanges gain/loss

2

29

49

28

Termination of trading hedges - cash

-3

-177

-11

-499

Current income tax

-4

77

-6

67

Other financial charges & expenses - cash

0

1

-8

-25

Other elements

-1

-4

-3

-2

Financial capacity

578

-731

-709

-2,078

Unit cost: net cost per ASK

Third quarter

Nine months

2021

2020

2021

2020

Revenues (in €m)

4,567

2,524

9,477

8,725

Income/(loss) from current operations (in €m) -/-

-132

1,046

1,800

3,414

Total operating expense (in €m)

4,435

3,570

11,277

12,139

Passenger network business – other revenues (in €m)

-90

-64

-221

-241

Cargo network business – other revenues (in €m)

-106

-84

-296

-226

Third-party revenues in the maintenance business (in €m)

-247

-247

-761

-963

Transavia - other revenues (in €m)

3

1

3

-13

Third-party revenues of other businesses (in €m)

-8

-10

-20

-21

Net cost (in €m)

3,988

3,166

9,983

10,674

Capacity produced, reported in ASK*

61,925

38,109

136,179

114,446

Net cost per ASK (in € cents per ASK)

6.44

8.31

7.33

9.33

Gross change

-22.5%

-21.4%

Currency effect on net costs (in €m)

-13

-137

Change at constant currency

-22.2%

-20.4%

Fuel price effect (in €m)

92

-84

Net cost per ASK on a constant currency and fuel price basis (in € cents per ASK)

6.44

8.52

7.33

9.13

Change at constant currency and fuel price basis

-24.4%

-19.7%

* The capacity produced by the transportation activities is combined by adding the capacity of the Passenger network (in ASK) to that of Transavia (in ASK).

Group results
Air France Group

Third quarter

Nine months

2021

Change

2021

Change

Revenue (in €m)

2,808

+88.2%

5,795

+14.4%

EBITDA (in €m)

379

+841

-413

+682

Operating result (in m€)

-45

+762

-1,451

+950

Operating margin (%)

-1.6%

+52.5 pt

-25.0%

+22.3 pt

Operating cash flow before WCR and restructuring cash out (in €m)

227

+835

-752

-752

Operating cash flow (before WCR and restructuring) margin

8.1%

+48.8 pt

-13.0%

-13.0 pt


KLM Group



Third quarter

Nine months

2021

Change

2021

Change

Revenue (in €m)

1,890

+65.3%

4,027

+1.1%

EBITDA (in €m)

408

+383

330

+505

Operating result (in m€)

168

+402

-354

+649

Operating margin (%)

8.9%

+29.4 pt

-8.8%

+16.4 pt

Operating cash flow before WCR and restructuring cash out (in €m)

309

+294

33

+33

Operating cash flow (before WCR and restructuring) margin

16.4%

+15.0 pt

0.8%

+0.8 pt

NB: Sum of individual airline results does not add up to Air France-KLM total due to intercompany eliminations at Group level

Group fleet at 30 September 2021

Aircraft type

AF
(incl. HOP)

KL
(incl. KLC & MP)

Transavia

Owned

Finance lease

Operating lease

Total

In operation

Change / 31/12/20

B747-400

B777-300

43

16

18

17

24

59

59

2

B777-200

21

15

26

10

36

36

-4

B787-9

10

13

5

6

12

23

23

B787-10

6

3

3

6

5

A380-800

8

4

1

3

8

A350-900

11

2

5

4

11

11

5

A340-300

A330-300

5

5

5

5

A330-200

15

7

11

11

22

21

Total Long-Haul

108

62

0

69

32

69

170

160

3

B737-900

5

5

5

5

B737-800

31

85

31

9

76

116

116

10

B737-700

11

4

4

3

8

15

15

-5

A321

19

11

8

19

19

-1

A320

44

4

4

36

44

44

A319

30

12

18

30

30

-3

A318

18

8

10

18

18

A220-300

1

1

1

Total Medium-Haul

112

47

89

76

16

156

248

247

1

ATR72-600

ATR72-500

ATR42-500

Canadair Jet 1000

14

14

14

11

-3

Canadair Jet 700

5

5

5

4

-5

Embraer 195 E2

4

4

4

4

4

Embraer 190

17

32

11

10

28

49

49

Embraer 175

17

3

14

17

17

Embraer 170

15

10

5

15

15

Embraer 145

9

9

9

Total Regional

60

53

0

52

24

37

113

100

-4

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

282

166

89

201

72

264

537

513

0

THIRD QUARTER 2021 TRAFFIC

Passenger network activity*

Q3

Year to date

Total Passenger network*

2021

2020

Variation

2021

2020

Variation

Passengers carried (‘000s)

12,694

6,783

87.1%

23,015

23,677

(2.8%)

Revenue pax-kilometers (m RPK)

34,019

13,752

147.4%

63,382

66,861

(5.2%)

Available seat-kilometers (m ASK)

52,532

32,100

63.7%

122,535

103,268

18.7%

Load factor (%)

64.8%

42.8%

21.9

51.7%

64.7%

(13.0)

Long-haul

Passengers carried (‘000s)

3,553

1,220

191.3%

6,891

7,077

(2.6%)

Revenue pax-kilometers (m RPK)

25,125

8,685

189.3%

48,289

52,764

(8.5%)

Available seat-kilometers (m ASK)

40,519

23,924

69.4%

100,470

82,777

21.4%

Load factor (%)

62.0%

36.3%

25.7

48.1%

63.7%

(15.7)

North America

Passengers carried (‘000s)

1,154

286

303.6%

1,852

1,875

(1.3%)

Revenue pax-kilometers (m RPK)

8,290

2,058

302.8%

13,434

13,392

0.3%

Available seat-kilometers (m ASK)

13,098

7,553

73.4%

29,170

23,374

24.8%

Load factor (%)

63.3%

27.2%

36.0

46.1%

57.3%

(11.2)

Latin America

Passengers carried (‘000s)

365

92

298.0%

731

964

(24.2%)

Revenue pax-kilometers (m RPK)

3,521

909

287.4%

7,035

9,144

(23.1%)

Available seat-kilometers (m ASK)

6,164

3,122

97.5%

16,621

13,469

23.4%

Load factor (%)

57.1%

29.1%

28.0

42.3%

67.9%

(25.6)

Asia / Pacific

Passengers carried (‘000s)

272

173

57.3%

611

1,361

(55.1%)

Revenue pax-kilometers (m RPK)

2,334

1,526

53.0%

5,212

11,803

(55.8%)

Available seat-kilometers (m ASK)

6,069

6,037

0.5%

18,033

20,702

(12.9%)

Load factor (%)

38.5%

25.3%

13.2

28.9%

57.0%

(28.1)

Africa / Middle East

Passengers carried (‘000s)

1,005

327

206.9%

2,222

1,563

42.2%

Revenue pax-kilometers (m RPK)

5,316

1,660

220.0%

11,691

8,812

32.7%

Available seat-kilometers (m ASK)

7,672

3,171

142.0%

20,144

12,313

63.6%

Load factor (%)

69.3%

52.4%

16.9

58.0%

71.6%

(13.5)

Caribbean / Indian Ocean

Passengers carried (‘000s)

757

341

121.6%

1,475

1,313

12.3%

Revenue pax-kilometers (m RPK)

5,663

2,532

123.6%

10,918

9,613

13.6%

Available seat-kilometers (m ASK)

7,515

4,042

85.9 %

16,502

12,918

27.7%

Load factor (%)

75.4%

62.7%

12.7

66.2%

74.4%

(8.3)

Short and Medium-haul

Passengers carried (‘000s)

9,141

5,563

64.3%

16,124

16,600

(2.9%)

Revenue pax-kilometers (m RPK)

8,895

5,067

75.5%

15,093

14,098

7.1%

Available seat-kilometers (m ASK)

12,013

8,176

46.9%

22,064

20,491

7.7%

Load factor (%)

74.0%

62.0%

12.1

68.4%

68.8%

(0.4)

* Air France and KLM

Transavia activity

Q3

Year to date

Transavia

2021

2020

Variation

2021

2020

Variation

Passengers carried (‘000s)

4,246

2,014

110.8%

5,772

4,453

29.6%

Revenue pax-kilometers (m RPK)

7,359

3,869

90.2%

9,881

8,505

16.2%

Available seat-kilometers (m ASK)

9,393

6,009

56.3%

13,645

11,178

22.1%

Load factor (%)

78.3%

64.4%

14.0

72.4%

76.1%

(3.7)

Total group passenger activity**

Q3

Year to date

Total group**

2021

2020

Variation

2021

2020

Variation

Passengers carried (‘000s)

16,940

8,797

92.6%

28,787

28,130

2.3%

Revenue pax-kilometers (m RPK)

41,378

17,620

134.8%

73,262

75,368

(2.8%)

Available seat-kilometers (m ASK)

61,925

38,113

62.5%

136,179

114,490

19.0%

Load factor (%)

66.8%

46.2%

20.6

53.8%

65.8%

(12.0)

** Air France, KLM and Transavia

Cargo activity

Q3

Year to date

Total Group

2021

2020

Variation

2021

2020

Variation

Revenue tonne-km (m RTK)

1,889

1,735

8.9%

6,055

4,747

27.6%

Available tonne-km (m ATK)

3,052

2,537

20.3%

8,363

7,309

14.4%

Load factor (%)

61.9%

68.4%

(6.5)

72.4%

64.9%

7.5


Air France activity

Q3

Year to date

Total Passenger network activity

2021

2020

Variation

2021

2020

Variation

Passengers carried (‘000s)

7,520

4,488

67.6%

14,172

14,641

(3.2%)

Revenue pax-kilometers (m RPK)

20,304

8,538

137.8%

38,027

39,394

(3.5%)

Available seat-kilometers (m ASK)

29,189

16,589

76.0%

63,241

56,909

11.1%

Load factor (%)

69.6%

51.5%

18.1

60.1%

69.2%

(9.1)


Long-haul

Passengers carried (‘000s)

2,261

784

188.5%

4,402

4,248

3.6%

Revenue pax-kilometers (m RPK)

15,256

5,223

192.1%

29,266

30,649

(4.5%)

Available seat-kilometers (m ASK)

22,394

11,463

95.3%

50,646

44,371

14.1%

Load factor (%)

68.1%

45.6%

22.6

57.8%

69.1%

(11.3)


Short and Medium-haul

Passengers carried (‘000s)

5,260

3,704

42.0%

9,770

10,393

(6.0%)

Revenue pax-kilometers (m RPK)

5,048

3,315

52.3%

8,761

8,744

0.2%

Available seat-kilometers (m ASK)

6,795

5,125

32.6%

12,595

12,538

0.5%

Load factor (%)

74.3%

64.7%

9.6

69.6%

69.7%

(0.2)


Q3

Year to date

Cargo activity

2021

2020

Variation

2021

2020

Variation

Revenue tonne-km (m RTK)

832

608

36.8%

2,648

1,802

46.9%

Available tonne-km (m ATK)

1,593

1,139

39.8%

4,194

3,390

23.7%

Load factor (%)

52.2%

53.4%

(1.2)

63.1%

53.2%

9.9

KLM activity

Q3

Year to date

Total Passenger network activity

2021

2020

Variation

2021

2020

Variation

Passengers carried (‘000s)

5,174

2,295

125.4%

8,843

9,036

(2.1%)

Revenue pax-kilometers (m RPK)

13,715

5,214

163.1%

25,354

27,468

(7.7%)

Available seat-kilometers (m ASK)

23,343

15,511

50.5%

59,294

46,359

27.9%

Load factor (%)

58.8%

33.6%

25.1

42.8%

59.3%

(16.5)


Long-haul

Passengers carried (‘000s)

1,293

436

196.4%

2,489

2,829

(12.0%)

Revenue pax-kilometers (m RPK)

9,869

3,462

185.1%

19,023

22,114

(14.0%)

Available seat-kilometers (m ASK)

18,125

12,461

45.5%

49,825

38,406

29.7%

Load factor (%)

54.5%

27.8%

26.7

38.2%

57.6%

(19.4)


Short and Medium-haul

Passengers carried (‘000s)

3,881

1,859

108.8%

6,354

6,207

2.4%

Revenue pax-kilometers (m RPK)

3,846

1,752

119.6%

6,332

5,353

18.3%

Available seat-kilometers (m ASK)

5,218

3,050

71.1%

9,469

7,953

19.1%

Load factor (%)

73.7%

57.4%

16.3

66.9%

67.3%

(0.4)


Q3

Year to date

Cargo activity

2021

2020

Variation

2021

2020

Variation

Revenue tonne-km (m RTK)

1,058

1,127

(6.1%)

3,407

2,942

15.8%

Available tonne-km (m ATK)

1,459

1,398

4.4%

4,169

3,919

6.4%

Load factor (%)

72.5%

80.6%

(8.1)

81.7%

75.1%

6.6


1 The third quarter 2020 was highly impacted by worldwide travel restrictions
2 Passenger unit revenue is the aggregate of Passenger network and Transavia unit revenues, change at constant currency
3 See appendix for the calculation of the net debt

Attachment


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