Business is looking good for Air-France KLM Group. KQ should borrow a tip.
The Air-France KLM Group Airline, one of the leading players in the global aviation industry, has announced that it expects to reach its pre-pandemic capacity levels by 2024. This is after the group recorded a remarkable increase in passenger capacity and traffic in the second half of 2023, as well as a significant improvement in its financial performance.
The group, which comprises of Air France, KLM Royal Dutch Airlines, Transavia, and Kenya Airways, among others, has been on a steady recovery path since the Covid-19 pandemic disrupted the global travel sector in 2020. The group has been able to adapt to the changing market conditions and customer preferences by leveraging on its innovation and sustainability initiatives.
According to the group’s half-year results, the group increased its passenger capacity by 8.2 per cent or 24.7 million passengers across its airlines in the second half of 2023 compared to the same review period in June 2022. The percentage increase was at 88 per cent of 2019 levels.
The group also saw its passenger traffic grow by 11.6 per cent, resulting in a higher load factor of 2.6 points compared to last year. The load factor is a measure of how efficiently an airline fills its seats and generates revenue.
The group attributes this impressive performance to its strategic network optimization, fleet renewal, and customer experience enhancement. The group has also been able to benefit from the gradual reopening of international borders and the easing of travel restrictions in some regions.
The group is optimistic that it will continue to grow its capacity and traffic in the coming quarters, as it aims to reach approximately 95 per cent capacity in Available Seat Kilometers (ASK) by the end of 2023. The ASK is a metric that measures the total number of seats available for passengers multiplied by the number of kilometers flown.
The group expects to register an ASK of 128.69 million by the fourth quarter of 2023, a 13 per cent increase from the 114.26 million registered in 2022. In Africa, the ASK is expected to rise to 14.74 million up from 13.14 million registered in 2022.
The group’s General Manager for East and Southern Africa, Nigeria, and Ghana Marius van der Ham expressed his confidence that by 2024, the group will not only recover to 2019 levels but also set new standards for the industry.
“We are thrilled to see our airlines rebounding with such resilience after the turbulent times brought about by the Covid-19 pandemic. Our commitment to innovation and adaptability has been pivotal in this journey. As we continue to invest in technology, customer experience, and sustainable aviation, we are confident that by 2024, we will not only recover to 2019 levels but also set new standards for the industry. This remarkable growth in passenger capacity and improved load factor is a testament to the dedication and hard work of our team and the unwavering trust of our passengers.” He said.
Air-France also reported a strong financial performance for the review period, with its net income growing by 88 per cent to KES 96.04 billion from KES 51 billion registered within the same review period in 2022. The revenues from ordinary activities went up 14 per cent to KES 1.19 trillion driven by a higher capacity (+8 per cent), a higher passenger load factor (+3 points), and a higher passenger yield (+9 per cent).
The group’s Chief Financial Officer Pierre-François Riolacci attributed this success to the group’s cost management and revenue optimization strategies.
“In spite of the inflationary context, we posted double-digit growth in our revenues and a record operating margin. The rollout of new award-winning products across our airlines continued unabated, which serves as a testament to the commitment of our employees, whom I would like to thank. Moving forward we intend to continue delivering on our strategic roadmap, and leverage secured ambitious partnerships in the field of sustainability that will prepare us for our medium to long-term future.” He said.
As Air-France looks forward to achieving its recovery and growth objectives, it remains focused on transforming its operations and enhancing its sustainability efforts. The group has been investing in modernizing its fleet, optimizing its workforce, expanding its network, and reducing its costs.
The group has also been at the forefront of promoting sustainable aviation, by reducing its carbon footprint, supporting green fuel initiatives, and partnering with environmental organizations. The group has set ambitious targets to reduce its CO2 emissions by 50 per cent by 2030 and achieve carbon neutrality by 2050.
The Air-France KLM Group Airline is determined to overcome the challenges posed by the Covid-19 pandemic and emerge as a stronger and more resilient player in the global aviation industry. The group is confident that with its innovative and sustainable approach, it will be able to offer its customers the best travel experience and create value for its stakeholders.