Air France-KLM (OTC:AFLYY) has unveiled a record €1.34 billion operating profit for the third quarter, a 31% year-on-year increase, propelled by a surge in summer bookings, similar to results reported by British Airways owner IAG on the same day.
Although the figures fell slightly short of the €1.37 billion consensus forecasts, costs outperformed expectations, attributed to effective jet fuel price hedging.
Despite looming concerns about rising oil prices and geopolitical instability, which have nudged airline stocks downward, Air France-KLM (OTC:AFLYY) maintained a positive outlook.
REACTION: Are these record profits as good as it gets for airlines?
The carrier, which has its headquarters in Tremblay-en-France, France, confirmed that Middle Eastern tensions have not significantly impacted bookings and plans to operate at 95% of its 2019 capacity levels this year.
The robust results across European airlines indicate that consumers are willing to pay higher ticket prices, bolstering the sector's profits.
Yesterday, Air France-KLM (OTC:AFLYY) agreed a €1.3 billion financing with Apollo Global Management (NYSE:APO) to create a "dedicated operating affiliate" of the airline to hold the trademark and most of the commercial partner contracts its joint Flying Blue loyalty program, becoming its exclusive issuer of air miles.
#AirFranceKLM and @apolloglobal sign a definitive agreement for a quasi-equity financing of €1.3 billion, with a potential upsize to €1.5 billion.
— Air France-KLM Group (@AirFranceKLM) October 26, 2023