News / Air France-KLM reverses two years of decline to post revenue growth in 2017

© Micha Klootwijk

Air France-KLM rebounded from a terrible 2016 to record an upturn in its cargo performance last year.

The Franco-Dutch carrier reported growth, albeit marginal at 0.9%, in cargo revenues to €2.09bn, following two successive years of decline.

And it appears its positive momentum has continued into 2018, with January cargo traffic increased 0.7% year-on-year, with the carrier describing it as “clearly up”.

Chairman Jean-Marc Janaillac said the airline benefitted from a “positive business environment”, adding the carrier will be on the “offensive” this year.

“As we enter 2018, in a context of rising oil prices and even more intense competition, we will pursue the offensive,” said Mr Janaillac.

“[We will] work on competitiveness and unit cost reduction and capitalise on the realisations of 2017 in order to maintain a profitable growth momentum.”

Full-year volumes reached 1.1m tonnes, an increase of 0.7% on 2018, but still some way below the 1.9% upturn in available tonne kilometres.

Fourth quarter numbers were stronger, with revenues for the three months to December up 6.8% compared to 2016 at €583m.

Volumes also grew 2.7%, although still at a slower pace to capacity, which was up 3.3% for the three-month period.

What this means for the carrier’s profitability cannot be assessed, with AF-KLM no longer reporting cargo profits separately.

However, in a statement, the carrier noted the strength of the market during the second half of 2017, when it saw traffic increase 1.8% on the previous year.

“The improvement in the cargo business was driven by solid demand growth to and from Asia as of the beginning of 2017 and from Latin America in the second half of the year,” said a spokesperson.

“Full freighter activity significantly improved in 2017 compared to last year, contributing to the overall cargo performance.”