Wednesday 27 July 2016

Air France warns on 'France as destination'

View Of An Air France Boeing 777 Aircraft Moi Int Airport Kenya 

Air France-KLM has warned about "France as a destination" as recent terror attacks weighed on sales in the second quarter of the year.

The airline group reported a 5% fall in revenue to €6.22bn (£5.2bn) compared with the same period last year.

Air France also joined other European airlines in warning of the impact from the "high level" of geopolitical and economic uncertainties.

However, operating profit rose 138% to €317m, partly due to lower fuel costs.
"The global context in 2016 remains highly uncertain... resulting in an increasing pressure on unit revenues and a special concern about France as a destination," the airline said.

Air France-KLM's results were issued hours after a priest was killed by two armed men in France, adding to a spate of attacks in Europe that has affected demand for travel and coming on top of the aftermath of the Brexit vote.

The Air France pilot strike also reduced profit by an estimated €40m.

Gerald Khoo, an analyst at Liberum, said the results were "not as bad as feared" as fuel savings had offset the decline in sales.

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