Air France-KLM surprise profit beat lifts shares to 5-year high

Joanna Plucinska - Reuters - 06/03
Air France-KLM reported better than expected annual results that sent its shares to a five-year high on Thursday after the airline benefitted from tight cost management and stronger pricing in the fourth quarter.
  • Air France-KLM's Q4 profit widely exceeds expectations
  • Profit supported by cost management, stronger pricing
  • Shares rise more than 20% to a five-year high
  • Dutch KLM still struggles with rising costs, lower margins
LONDON, March 6 (Reuters) - Air France-KLM (AIRF.PA), opens new tab reported better than expected annual results that sent its shares to a five-year high on Thursday after the airline benefitted from tight cost management and stronger pricing in the fourth quarter.
Chief Executive Ben Smith said the airline enjoyed a particularly strong finish after a year shaped by both operational and external challenges.
Airlines saw strong demand in 2024 but were hit with strikes, high inflation and maintenance costs.
In the fourth quarter, Air France-KLM reported an operating profit of 396 million euros ($427 million), nearly double the 205 million euros expected by analysts polled by LSEG, driven by increased passenger numbers and cost containment efforts.
The shares were up 20.5% at 0950 GMT, with JP Morgan analysts saying in a note that the group posted an "impressive fourth quarter beat on stronger pricing with a very positive outlook for 2025".
Further cost control, pricing increases and reduced profit headwinds could lead to a shift in earnings momentum into 2025, the analysts said.
Air France-KLM expects operating profit to improve by at least 300 million euros in 2025, with costs (excluding fuel) up by a low single digit percentage and positive unit revenue development in t...
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