Wednesday 10 August 2022

KLM is back in profit as demand for air travel soars

Photo: DutchNews.nl

Airline Air France-KLM booked net profit of €324 million in the second quarter of 2022 – the first time the company has been profitable since the start of the coronavirus outbreak.

The airline booked a loss of €552 million in the first quarter of this year.

The return to profitability comes as passenger numbers and demand for tickets soared. The airline flew almost 23 million people in the second quarter, up 224% on the end of last year.

The increase in demand for air travel has led to major problems at Schiphol airport, where passengers have had to wait for several hours to deposit baggage and clear security. KLM has also been forced to cancel hundreds of flights because of restrictions imposed by the airport authority.

Air France-KLM chief executive Benjamin Smith said the company had been prepared for the increase in demand but is not immune to the operational difficulties at airports around the world.

‘The strong recovery we see this summer is putting the entire aviation industry to the test,’ he said in a press statement.

Dutch flag carrier KLM booked operating profit of €262 million, up from €3 million in the first quarter.

Loans

In June, KLM completed the repayment of the €942 million loan it secured from the Dutch government to deal with the Covid-19 crisis.

In total, the airline had been given a credit facility of €3.4 billion.

KLM said at the time various factors including the cutting of 6,000 staff jobs, a sharp reduction in costs, the removal of travel restrictions and the rising demand for airline tickets had made repayment possible.

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