2023 Full Year Results
Air France-KLM reports strong financial results for full year 2023 with improved operating margin, increased revenues, and positive net income. The Group's equity has been restored, net debt reduced, and inaugural credit ratings achieved. Major achievements include historic aircraft orders and commitment to sustainability. The Group's global employee shareholding plan was successful. The outlook for 2024 includes capacity increase, unit cost expectations, and net capex projections.
Positive
Air France-KLM achieved a 14% increase in revenues to €30.0 billion in 2023 compared to the previous year.
Operating margin improved to 5.7%, up by +1.2pt from the previous year.
Net income reached €0.9 billion, driving a return in positive equity at €0.5 billion for the first time since 2019.
Net debt decreased by €1.3 billion, leading to a Net debt/EBITDA ratio of 1.2x.
The Group placed a historic order for fifty Airbus A350s with purchase rights for forty additional aircraft.
Air France-KLM confirmed its position as the world's leading user of sustainable aviation fuel.
The Group completed a €1.5 billion financing transaction with Apollo to support its loyalty program.
Successful completion of the 'Partners for the future' employee shareholding offer with approximately 22% of eligible employees subscribing.
2024 outlook includes a 5% capacity increase, unit cost expectations, and net capex projections.
Negative
Operating result in the fourth quarter was impacted by geopolitical tensions and disruptions, standing at -€56 million.
Cargo unit revenue decreased in the fourth quarter, impacting full-year revenues.
The unit revenue per Available Ton Kilometer in the Cargo segment declined by -31.8% at constant currency.
KLM's operating margin decreased by -1.2pt in 2023 compared to the previous year.
Some disruptions occurred in KLM operations in the fourth quarter due to bad weather in Amsterdam.
02/29/2024 - 01:15 AM
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February 29, 2024
Sustained demand translating into improved operating margin at 5.7% Group’s equity restored
Group capacity at 93% compared to 2019 with load factor at 87% Group revenues at €30.0b n, up 14% compared to last year Operating result at €1.7b n with an operating margin at 5.7% , up +1.2pt compared to last year Net income at €0.9b n driving a return in positive equity at €0.5b n for the first time since 2019 Net debt down by €1.3b n, compared to end of 2022 leading to a Net debt/EBITDA ratio of 1.2x; Cash at hand at €10.5b n 2 inaugural credit ratings highlighting the Group’s ongoing transformation and an improved financial structure Commenting on the results, Mr. Benjamin Smith, Group CEO , said:
“In 2023, we delivered on our commitment to strong operational and financial performance, while also maintaining our position as a benchmark airline Group for sustainability. Among our major achievements, we can be satisfied of our efforts to further strengthen our balance sheet and restore the Group’s equity. We also placed a historic order for fifty Airbus A350s with purchase rights for forty additional aircraft, thereby accelerating our fleet’s renewal with latest-generation aircraft that offer improved fuel efficiency, lower CO2 and noise emissions, and an enhanced experience for our customers. We also confirmed our position as the world's leading user of sustainable aviation fuel, demonstrating our determination to double down on this key decarbonization lever to achieve our sustainability objectives. I would like to thank all Air France-KLM employees whose hard work has made these accomplishments possible. Looking ahead to 2024, a key priority will be to continue reinforcing our performance, via the continued execution of our strategy. This year will mark Air France-KLM’s 20th anniversary, an occasion made all the more special by the Paris 2024 Olympic and Paralympic Games, of which Air France is a proud official sponsor. We look forward to welcoming the world to France – athletes, delegates, supporters and more – onboard our aircraft to celebrate the world’s largest event.”
Operating result impacted by cargo unit revenue, geopolitical situation and disruptions in Q4
Fourth quarter Full Year 2023 change change constant currency 2023 change change constant currency Revenues (€m) 7,407 +3.9 % +6.7 % 30,019 +13.7 % +15.1 % EBITDA (€m) 601 -185 -159 4,208 593 624 Operating result (€m) -56 -190 -164 1,712 519 550 Operating margin (%) -0.8 % -2.6pt -2.3pt 5.7 % +1.2pt +1.2pt Net income – Group part (€m) -256 -752 934 206 Adj. operating free cash flow (€m) -1,198 -648 -392 -2,295
31 Dec 2023 31 Dec 2022 Net Debt 5,041 6,337 EBITDA trailing 12 months 4,208 3,615 Net Debt/EBITDA ratio 1.2x 1.8x
Fourth quarter Full Year 2023 change change constant currency 2023 change change constant currency Group unit revenue per ASK (€ cts) 8.56 -3.6% -1.2% 8.80 +3.3% +4.5% Group unit cost per ASK (€ cts) at constant fuel 8.63 -0.7% +3.5% 8.25 +1.8% +4.7%
Fourth Quarter 2023
In the fourth quarter, revenues were up +6.7% at a constant currency compared to Q4 2022 supported by a combination of an increase in capacity (+6% ) and an improved passenger yield (+3.2% ) partly absorbed by a cargo unit revenue decrease (-31.8% ).
The operating result was €190 million below last year standing at -€56 million and was impacted by the geopolitical situation in Africa and in the Middle East (€65m ) and an increase of the unit cost, although partly compensated by a lower jet fuel price.
The group unit cost per ASK at constant fuel and constant currency is up 3.5% versus last year due an increase in operational disruption costs for €70 million and a one-time non-cash impact (IFRS2) related to the employee shareholding plan for €30m .
Full-Year 2023
Air France-KLM recorded the highest revenue in its history in 2023, amounting to €30b n, up +15.1% at constant currency. The operating margin stood at 5.7% , sequentially improving by +1.2pt compared to last year thanks to a combination of strong yield and load factor. Net income amounted to €934 million , up by €206 million , which, combined with the quasi equity financings occurred during the year, leads to a return in positive equity (€0.5b n).
The full year adjusted operating free cash flow was impacted by the payment of the wage taxes, pensions & social charges accumulated during Covid (€350 million ).
In January 2024, Air France fully redeemed €610 million of the deferred pensions payment to the Caisse des Retraites des Personnels Navigants (CRPN). The Group thanks the CRPN pilots for their support. The Group will redeem the remaining social charges and wage taxes of around €1.7 billion until 2027.
The net debt ended at €5.0 billion representing an improvement of €1.3 billion compared to 2022.
Passenger unit revenue up thanks to improved load factor and yield
Fourth quarter Full Year 2023 change change constant currency 2023 change change constant currency Passengers (thousands) 22,347 +6.4% 93,565 +12.3% Capacity (ASK m) 77,024 +6.0% 309,505 +9.5% Traffic (RPK m) 65,691 +5.3% 270,134 +13.7% Passenger load factor 85.3% -0.6pt 87.3% +3.3pt Passenger unit revenue per ASK (€ cts) 7.90 +0.4% +2.8% 8.15 +9.5% +10.7%
In the fourth quarter 2023, Air France-KLM welcomed 22.3 million passengers which is 6.4% above previous year. As capacity increased by 6.0% and traffic grew by 5.3% , the load factor was broadly stable at -0.6 point compared to last year.
The Group passenger unit revenue per ASK was up +2.8% at constant currency compared to last year. This increase was driven by an increase in yield across all long-haul geographies and Short & Medium-haul.
Upsizing and the completion of a quasi-equity financing of €1.5 billion
Following the signing on October 26, 2023, of a definitive agreement between Air France-KLM and Apollo (NYSE: APO) regarding the financing of a dedicated operating affiliate of Air France-KLM, the companies announced on November 30th , that they have completed the transaction for an upsized total amount of €1.5 billion .
The financing by Apollo-managed and third-party investment vehicles supports a dedicated operating affiliate of Air France-KLM that holds the trademark and most of the commercial partners contracts related to Air France and KLM’s joint loyalty program (“Flying Blue”) as well as the exclusive right to issue "Miles” for the airlines and their partners. The financing is accounted for as equity under IFRS. As announced by Air France-KLM during its Q3 2023 results, this outcome materializes the steps implemented by the Group to restore its IFRS equity to positive by year end.
The transaction upsize to €1.5 billion reflects strong investor confidence and the quality of Air France-KLM Flying Blue Miles issuance activity. The transaction terms disclosed in late October 26, 2023, remain unchanged, with a fixed coupon of 6.4% p.a. for the first four years, with the right for Air France KLM to redeem with at overall financing fixed cost of 6.75% at the first call date.
The agreed structure will incur no material changes for Flying Blue members. Air France-KLM will continue managing and operating the Flying Blue loyalty program, and Air France and KLM will each keep full control on the Flying Blue customer database. In addition, the financing structure will not affect social aspects for Air France, KLM nor Air France-KLM employees’ contracts.
Success of Air France-KLM Group's global employee shareholding plan
On December 21st , 2023, Air France-KLM has successfully finalized its "Partners for the future" employee shareholding offer, a capital increase reserved for approximately 75,000 eligible employees of the Group, launched in November 2023.
For this Group's first worldwide operation, approximately 17,000 employees located in 19 countries, representing approximately 22% of the total workforce of the Group, have subscribed to the "Partners for the future" offer, enabling them to invest in Air France-KLM shares on preferential terms.
The total subscription amounts to nearly 46,073,029 euros, corresponding to the issue of 5,716,256 new shares with a par value of one euro each. As a result, the Company's share capital was increased by 5,716,256 euros, from 257,053,613 euros to 262,769,869 euros.
Following this issuance, the employee shareholders in Air France-KLM’s share capital, within the meaning of Article L. 225-102 of the French Commercial Code, is just over 3% of the share capital.
2024 OUTLOOK
Capacity
The Group expects the capacity in Available Seat Kilometers for Air France-KLM Group including Transavia to increase by 5% in 2024 compared to 2023.
Unit cost 1
For the first quarter 2024, the Group expects a unit cost up +4% compared to 2023 due to the continuation of high disruption cost in the first two months and a one-time payment of 2% of the yearly salary to the KLM staff as agreed in the Collective Labour Agreement.
For the full year 2024, the Group expects a unit cost in the range of 1% to 2% compared to 2023.
Capex
Full year 2024 net capex is expected to stand between 3.0 billion and 3.2 billion euros.
Business review
Strong year for the network operations
Network Fourth quarter Full Year 2023 change change constant currency 2023 change change constant currency Traffic revenues (€m) 6,055 +1.9% +4.6% 24,560 +12.4% +13.9% Total revenues (€m) 6,342 +2.2% +4.8% 25,636 +12.6% +14.0% Operating result (€m) 60 -178 -155 1,693 +562 +574 Operating margin (%) 0.9% -2.9 pt 6.6% 1.6 pt
Compared to the fourth quarter 2022, total revenues increased by +2.2% to €6,342 million . The operating result was positive and stood at €60 million despite geopolitical tensions. The increase in revenues was driven by the high demand in passenger network despite the weakening of Cargo market.
Altogether, the network activity posted a strong operating result at €1,693 million in 2023, representing an improvement of €562 million compared to last year. As a consequence, the operating margin rose by 1.6pt to 6.6% . This result was mainly driven by a combination of strong yield and load factor at passenger business.
Like in Q4 2023, Q1 2024 will be impacted as well by operational disruptions, while Air France started to fly again to Tel Aviv as per 24th of January.
Robust growth in unit revenue
Passenger network Fourth quarter Full Year 2023 change change constant currency 2023 change change constant currency Passengers (thousands) 17,736 +7.6% 72,101 +11.0% Capacity (ASK m) 67,333 +6.5% 267,061 +8.8% Traffic (RPK m) 57,527 +5.8% 232,334 +13.0% Load factor 85.4% -0.6pt 87.0% 3.2pt Total passenger revenues (€m) 5,691 +6.2% +8.7% 23,148 +20.2% +21.5% Traffic passenger revenues (€m) 5,546 +6.5% +9.2% 22,548 +20.0% +21.4% Unit revenue per ASK (€ cts) 8.23 0.0% +2.6% 8.44 +10.2% +11.6%
Fourth quarter 2023 capacity in Available Seat Kilometers (ASK) was 6.5% higher than last year and at 90% of 2019 level. Slightly lower traffic (+5.8% ) than capacity growth has led to a steadiness in load factor at 85.4% (-0.6 point compared to last year) while yield continued to rise (+3% against a constant currency).
This performance had a positive impact on Unit revenue per ASK which rose by 2.6% at a constant currency.
During the fourth quarter we observed per area the following trends:
North Atlantic Q4 capacity for the region was +7.0% vs 2022 with a slightly lower load factor of -0.6pt and yield increased by 2.9% vs 2022. Overall a good performance, especially with additional capacity increasing revenues versus 2022.
Latin America Demand remained very strong over the fourth quarter, enabling to further increase the yield by 3.9% with a high load factor at 89% against a robust 2022. Dynamic regions were Brazil and Central America.
Asia & Middle East Capacity in the fourth quarter has significantly increased versus 2022, by 34.4% however still -26% below 2019 Growth was mainly driven by the growth in China. Yield and load factor remained stable compared to last year despite the geopolitical disruptions across the area. Middle East was impacted by side effects on Egypt and Lebanon due to cancellation on Israel. Dynamic regions over the quarter were India and South East Asia.
Caribbean & Indian Ocean The fourth quarter continued to show capacity reductions compared to 2022 (-14.6% ) due to redeployment of fleet to other long-haul areas. This lower capacity pushed the load factor up to 87% and yield improved by 12.3% .
Africa Despite the geopolitical situation in Niger, Mali and Burkina Faso, the Group enjoyed continued strong demand resulting in a moderate growth of capacity where unit revenues kept stable. The yield showed resiliency and was up 1% above 2022 while the load factor was broadly stable (-0.7pt).
Short and Medium-haul Capacity increased by +5.4% with different dynamics. KLM Medium Haul went up +11% , last year was relatively low due to operational issues. Air France Short and Medium Haul went moderate up by 2% . Air France reduced further its footprint in France.
Cargo: a lower unit revenue compared to 2022 due to cargo market situation
Cargo business Fourth quarter Full Year 2023 change change constant currency 2023 change change constant currency Tons (thousands) 235 -0.3% 875 -6.1% Capacity (ATK m) 3,577 +5.0% 14,076 +6.2% Traffic (RTK m) 1,772 +0.9% 6,550 -4.9% Load factor 49.5% -2.0pt 46.5% -5.4pt Total Cargo revenues (€m) 651 -22.9% -20.3% 2,488 -29.0% -27.6% Traffic Cargo revenues (€m) 510 -30.4% -28.2% 2,012 -34.0% -32.9% Unit revenue per ATK (€ cts) 14.23 -33.8% -31.8% 14.29 -37.9% -36.8%
In the fourth quarter, unit revenue was below last year, driven by a -31% yield decrease and a 2 points lower load factor due to an increase of belly capacity. The yield is still 32% higher than 2019.
Compared to last year, full-year revenues dropped by -22.9% although less than previous quarters. The traffic was stable year over year at 0.9% on the back of a strong demand in 2022. The load factor was 2.0 points below 2022, due to the increased belly capacity. The yield declined as well resulting in a decrease in unit revenue per Available Ton Kilometer of -31.8% at constant currency.
Transavia: full year load factor up by 4 points while capacity continued to increase
Transavia Fourth quarter Full Year 2023 change 2023 change Passengers (thousands) 4,611 +2.4% 21,464 +16.9% Capacity (ASK m) 9,692 +2.9% 42,445 +13.6% Traffic (RPK m) 8,163 +2.3% 37,800 +18.7% Load factor 84.2% -0.5pt 89.1% +3.9pt Total Passenger revenues (€m) 536 +4.4% 2,640 +19.0% Unit revenue per ASK (€ cts) 5.61 +3.2% 6.34 +4.6% Unit cost per ASK (€ cts) 6.79 +2.3% 6.56 +3.8% Operating result (€m) -114 -1 -97 +2
The operating result of -€114 million in the fourth quarter is explained by seasonality and the geopolitical tensions in the Middle East (-€20m ). Transavia’s capacity increased by 2.9% , traffic increased by 2.3% , and the number of passengers increased by 2.4% resulting in a broadly stable load factor at 84.2% in the fourth quarter.
During 2023, Transavia pursued its growth to respond to the demand and satisfy customer expectations with a capacity increase of +13.6% compared to 2022. In total, the company launched 35 new routes in 2023 to various destinations in Europe and beyond from several French airports.
The forward booking load factor for the first half of 2024 is broadly stable compared to last year awhile capacity continues to grow. Transavia France restarted as per 1st of February to fly again to Israel.
Maintenance business: Strong recovery in 2023 despite supply chain issues
Maintenance Fourth quarter Full Year 2023 change change constant currency 2023 change change constant currency Total revenues (€m) 1,208 +18.6% 4,242 +18.3% Third party revenues (€m) 521 +28.7% +40.0% 1,712 +23.2% +26.9% Operating result (€m) 25 +10 +15 150 -13 -6 Operating margin (%) 2.1% +0.6pt +0.9pt 3.5% -1.0pt -0.9pt
The maintenance segment continued its growth in the fourth quarter 2023. Total revenues increased by 18.6% compared with the same quarter last year while third party revenues increased by 40.0% at constant currency, showing a very strong recovery. The operating margin stood at 2.1% , which is 0.6 point higher than in 2022.
During 2023, external revenues strongly increased by +23.2% despite the supply chain disruption and a tight labour market.
The maintenance order book was evaluated at US$8.7 billion at December 31, 2023.
Fleet
Compared to the end of 2022 the group added three B787-10, seven A350-900, sixteen B737-800, sixteen A220-300, four Embraer 195-E2 and two Embraer 190. The Group welcomed as well its first A320 Neo and A321 Neo in December. The following aircraft left the fleet: three B737-700, three A321, two A320, six A319, three A318, three Embraer 170 and four CRJ-1000, as a result the fleet increased by twenty nine aircraft.
The Group will continue to invest in new generation aircraft in order to improve its economic performance and will decrease its C02 emission and reduce noise.
Strong profitability for both airlines in 2023
Air France Group
Fourth quarter Full Year 2023 change 2023 change Revenue (in €m) 4,552 +0.3% 18,518 +13.7% EBITDA (in €m) 390 -142 2,657 +696 Operating result (in €m) -22 -165 1,085 +602 Operating margin (%) -0.5% -3.6pt 5.9% +2.9pt
Air France full-year performance is stemming from a strong performance of long-haul resulting in an increase of revenue of +13.7% . Operating result improved substantially to €1.1 billion , which is €602 million euros higher than last year. Transformation efforts as well as strong pricing momentum bore fruits and enabled Air France to improve its operating margin by 2.9pt, compared to 2022, to 5.9% despite the geopolitical situation faced since the second half of the year.
KLM Group
Fourth quarter Full Year 2023 change 2023 change Revenue (in €m) 2,993 +8.5% 12,050 +12.8% EBITDA (in €m) 227 -34 1,572 -107 Operating result (in €m) -18 -16 650 -56 Operating margin (%) -0.6% -0.5pt 5.4% -1.2pt
KLM’s revenue grew by +12.8% on the back of improved operations, although not optimal yet due to supply chain, while operating margin stood at 5.4% , down -1.2pt compared to last year. KLM was operating with capacity constraints and in the fourth quarter some disruptions occurred linked to the bad weather in Amsterdam and weighted on the operating result development.
Nb: Sum of individual airline results does not add up to AF-KLM total due to intercompany eliminations at Group level.
The audit procedures have been completed. The audit report is in the process of being issued.
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The results presentation is available at www.airfranceklm.com on February 29, 2024 from 7:15 am CET.
A conference call hosted by Mr. Smith (CEO) and Mr. Zaat (CFO) will be held on February 29, 2024 at 08.30 am CET.
To connect to the webcast, please use below link:
https://channel.royalcast.com/landingpage/airfranceklm/20240229_1/
Investor Relations Press Office Michiel Klinkers Marouane Mami +33 1 41 56 56 00 Michiel.klinkers@airfranceklm.com marouane.mami@airfranceklm.com mail.mediarelations@airfranceklm.com
Income statement
Fourth Quarter Year to Date in € million 2023 2022 Variation 2023 2022 Variation restated * restated * Revenues from ordinary activities 7,407 7,128 4 % 30,019 26,393 14 % Aircraft fuel -1,945 -2,057 -5 % -7,305 -7,241 1 % Carbon emission -64 -82 -22 % -203 -141 44 % Chartering costs -142 -101 41 % -551 -387 42 % Landing fees and air routes charges -450 -439 3 % -1,908 -1,710 12 % Catering -211 -195 8 % -829 -720 15 % Handling charges and other operating costs -464 -418 11 % -1,856 -1,608 15 % Aircraft maintenance costs -718 -613 17 % -2,549 -2,256 13 % Commercial and distribution costs -244 -246 -1 % -1,029 -887 16 % Other external expenses -530 -412 29 % -1,909 -1,488 28 % Salaries and related costs -2,339 -2,049 14 % -8,650 -7,289 19 % Taxes other than income taxes -32 -38 -16 % -164 -156 5 % Other income and expenses 333 308 8 % 1,142 1,105 3 % EBITDA 601 786 -24 % 4,208 3,615 16 % Amortization, depreciation and provisions -657 -652 1 % -2,496 -2,422 3 % Income from current operations -56 134 nm 1,712 1,193 44 % Sales of aircraft equipment -1 21 nm 32 66 -52 % Other non-current income and expenses -79 -21 nm -67 -65 3 % Income from operating activities -136 134 nm 1,677 1,194 40 % Cost of financial debt -157 -153 3 % -600 -569 5 % Income from cash & cash equivalent 77 33 133 % 253 41 nm Net cost of financial debt -80 -120 -33 % -347 -528 -34 % Other financial income and expenses -27 295 nm -183 -324 -44 % Income before tax -243 309 nm 1,147 342 nm Income taxes 12 183 -93 % -164 390 nm Net income of consolidated companies -231 492 nm 983 732 nm Share of profits (losses) of associates – 12 nm 7 12 -42 % Net Income for the period -231 504 nm 990 744 33 % Non-controlling interests 25 8 nm 56 16 nm Net Income for the period - Equity holders -256 496 nm 934 728 28 %
* Restated figures include the change in accounting principles for CO2 quotas
Consolidated balance sheet
Assets December 31, 2023 December 31, 2022 (in € million) Restated * Goodwill 224 225 Intangible assets 1,128 1,127 Flight equipment 11,501 10,614 Other property, plant and equipment 1,431 1,375 Right-of-use assets 5,956 5,428 Investments in equity associates 129 120 Pension assets 45 39 Other non-current financial assets 1,262 1,184 Non-current derivatives financial assets 148 262 Deferred tax assets 698 714 Other non-current assets 153 78 Total non-current assets 22,675 21,166 Other current financial assets 1,292 620 Current derivatives financial assets 122 327 Inventories 853 723 Trade receivables 2,152 1,785 Other current assets 1,120 979 Cash and cash equivalents 6,194 6,626 Assets held for sale 82 79 Total current assets 11,815 11,139 Total assets 34,490 32,305
* Restated figures include the change in accounting principles for CO2 quotas
Liabilities and equity December 31, 2023 December 31, 2022 (in € million) Issued capital 263 2,571 Additional paid-in capital 7,560 5,217 Treasury shares -25 -25 Perpetual 1,076 933 Reserves and retained earnings -10,925 -11,700 Equity attributable to equity holders of Air France-KLM -2,051 -3,004 Perpetual 2,524 510 Reserves and retained earnings 27 14 Equity attributable Non-controlling interests 2,551 524 Total equity 500 -2,480 Pension provisions 1,685 1,634 Non-current return obligation liability and other provisions 3,805 4,149 Non-current financial liabilities 7,538 9,657 Non-current lease debt 3,581 3,318 Non-current derivatives financial liabilities 56 21 Deferred tax liabilities — 1 Other non-current liabilities 1,376 2,343 Total non-current liabilities 18,041 21,123 Current return obligation liability and other provisions 1,079 740 Current financial liabilities 1,664 896 Current lease debt 848 834 Current derivatives financial liabilities 139 83 Trade payables 2,447 2,424 Deferred revenue on ticket sales 3,858 3,725 Frequent flyer programs 899 900 Other current liabilities 5,002 4,057 Bank overdrafts 13 3 Total current liabilities 15,949 13,662 Total equity and liabilities 34,490 32,305
Statement of Consolidated Cash Flows from January 1 until December 31
Period from January 1 to December 31 2023 2022 (in € million) restated * Net income 990 744 Amortization, depreciation and operating provisions 2,496 2,422 Financial provisions 216 145 Loss (gain) on disposals of tangible and intangible assets -63 -92 Loss (gain) on disposals of subsidiaries and associates – 1 Derivatives – non monetary result -2 -4 Unrealized foreign exchange gains and losses, net -92 151 Share of (profits) losses of associates -7 -12 Deferred taxes 106 -436 Impairment 1 32 Other non-monetary items -71 -204 Self-financing capacity 3,574 2,747 (Increase) / decrease in inventories -135 -155 (Increase) / decrease in trade receivables -330 -146 Increase / (decrease) in trade payables -23 570 Increase / (decrease) in advanced ticket sales 128 1,092 Change in other assets and liabilities -89 574 Change in working capital requirement -449 1,935 Net cash flow from operating activities 3,125 4,682 Acquisition of subsidiaries, of shares in non-controlled entities -7 -3 Proceeds on disposal of subsidiaries, of shares in non-controlled entities – -1 Purchase of property plant and equipment and intangible assets -3,551 -2,798 Proceeds on disposal of property plant and equipment and intangible assets 867 880 Dividends received 3 2 Decrease (increase) in net investments, more than 3 months -540 -59 Acquisition of warrants (1) -12 – Net cash flow used in investing activities -3,240 -1,979 Increase of equity 35 1,551 Capital increase paid by shareholders and non-controlling interests 9 3 Payments to acquire treasury shares -1 – Issuance of perpetual 2,718 798 Repayment on perpetual -595 -1,767 Coupon on perpetual -92 -252 Issuance of debt 2,094 1,110 Repayment on debt -3,324 -3,078 Payments on lease debts -833 -861 New loans -335 -305 Repayment on loans 129 45 Dividends paid -90 – Net cash flow from financing activities -285 -2,756 Effect of exchange rate on cash and cash equivalents -42 22 Change in cash and cash equivalents and bank overdrafts -442 -31 Cash and cash equivalents and bank overdrafts at beginning of period 6,623 6,654 Cash and cash equivalents and bank overdrafts at end of period 6,181 6,623
* Restated figures include the change in accounting principles for CO2 quotas (1) Participation to warrants issue of GOL 26 September.
Return on capital employed (ROCE)
In € million Dec 31, 2023 Sept 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sept 30, 2022 Jun 30, 2022 Mar 31, 2022 restated (2) restated (1) (2) restated (1) (2) restated (1) (2) restated (1) (2) restated (1) (2) Goodwill and intangible assets 1,352 1,331 1,339 1,351 1,352 1,350 1,361 1,363 Flight equipment 11,501 11,296 10,957 10,954 10,614 10,298 10,521 10,537 Other property, plant and equipment 1,431 1,379 1,389 1,372 1,375 1,349 1,358 1,378 Right of use assets 5,956 5,596 5,480 5,304 5,428 5,536 5,439 5,205 Investments in equity associates 129 127 121 122 120 111 108 107 Financial assets excluding marketable securities, accrued interests and financial deposits 219 191 190 169 169 164 162 158 Provisions, excluding pension, cargo litigation and restructuring -4,346 -4,481 -4,248 -4,255 -4,347 -4,792 -4,473 -4,240 WCR (3) -6,981 -7,804 -8,917 -8,696 -7,213 -7,609 -8,338 -6,736 Capital employed 9,261 7,635 6,311 6,321 7,498 6,407 6,138 7,772 Average capital employed (A) 7,382 6,954 Adjusted results from current operations 1,712 1,193 - Dividends received -1 -1 - Share of profits (losses) of associates 7 12 - Normative income tax -444 -311 Adjusted result from current operations after tax (B) 1,274 893 ROCE, trailing 12 months (B/A) 17.3% 12.8%
(1) Proforma figures include restatement related to change in accounting scheme of ETS quotas (see financial statements of the period).
(2) Compared to previous periods, the working capital has been restated to exclude the report of social & fiscal charges granted consequently to Covid.
(3) Excluding the report of social & fiscal charges granted consequently to Covid.
Net debt
(in € million) December 31, 2023 December 31, 2022 Current and non-current financial liabilities 9,202 10,553 Current and non-current lease debt 4,429 4,152 Accrued interest -138 -127 Deposits related to financial liabilities -107 -101 Deposits related to lease debt -100 -99 Derivatives impact on debt -1 -35 Gross financial liabilities (I) 13,285 14,343 Cash and cash equivalent 6,194 6,626 Marketable securities > 3 months 1,097 572 Bonds 966 811 Bank overdrafts -13 -3 Net cash (II) 8,244 8,006 Net debt (I-II) 5,041 6,337
Adjusted operating free cash flow
Fourth Quarter Year to Date 2023 2022 2023 2022 (in € million) restated * restated * Net cash flow from operating activities -310 206 3,125 4,682 Purchase of property plant and equipment and intangible assets -1,271 -750 -3,551 -2,798 Proceeds on disposal of property plant and equipment and intangible assets 591 202 867 880 Operating free cash flow -990 -342 441 2,764 Payments on lease debts -208 -208 -833 -861 Operating free cash flow adjusted -1,198 -550 -392 1,903
* Restated figures include the change in accounting principles for CO2 quotas
Bridge from EBITDA to Self-financing capacity
Fourth Quarter Year to Date 2023 2022 2023 2022 (in € million) restated * restated * EBITDA 601 786 4,208 3,615 Provisions (risk and other) -1 -1 -11 -16 Correction of spare parts inventory – -5 1 -1 Addition to pension provisions 44 28 153 125 Reversal to pension provisions (cash-out) -48 -50 -98 -100 Payment linked with shares 33 – 33 1 Sales of tangible and intangible assets (excluding aeronauticals) 8 -1 4 -3 Income from operating activities - cash impact 637 757 4,290 3,621 Restructuring costs -20 -58 -112 -233 Other non-current income and expenses -3 – -7 -7 Cost of financial liability -159 -153 -710 -582 Financial income 72 28 231 25 Realized foreign exchanges gain/loss 1 -11 37 -22 Settlement of forwards derivatives - cash – – -3 – Other financial charges & expenses - cash -82 – -97 -11 Current income tax 34 -20 -64 -46 Other elements 6 1 9 2 Self-financing capacity 486 544 3,574 2,747
* Restated figures include the change in accounting principles for CO2 quotas
Unit cost: net cost per ASK
Fourth Quarter Year to date 2023 2022 2023 2022 Total operating expenses (in €m) 7,463 6,994 28,305 25,198 Total other revenues (in €m) -807 -673 -2,768 -2,284 Net cost (in €m) 6,656 6,320 25,537 22,913 Capacity produced, reported in ASK 77,024 72,632 309,505 282,761 Net cost per ASK (in € cents per ASK) 8.64 8.70 8.25 8.10 Gross change -0.7 % 1.8 % Currency effect on net costs (in €m) -129 -245 Change at constant currency 1.4 % 2.9 % Fuel price effect (in €m) -130 -388 Net cost per ASK on a constant currency and constant fuel price (in € cents per ASK) 8.64 8.35 8.25 7.88 Change at constant currency and constant fuel price 3.5 % 4.7 % Furlough +4 +269 8.64 8.35 8.25 7.97 Change at constant currency and constant fuel price excluding furlough 3.5 % 3.5 %
Group fleet at 31 December 2023
Aircraft type AF (incl. HOP) 2 KL (incl. KLC & MP) 1 Transavia Owned Finance lease Operating lease Total In operation Change vs 31/12/22 B777-300 43 16 20 15 24 59 59 B777-200 18 15 28 1 4 33 33 B787-9 10 13 4 7 12 23 23 B787-10 10 2 8 10 10 3 A380-800 4 3 1 4 A350-900 27 3 10 14 27 26 6 A330-300 5 5 5 5 A330-200 15 6 11 10 21 21 Total Long-Haul 117 65 0 71 41 70 182 177 9 B737-900 5 5 5 5 B737-800 31 111 35 8 99 142 141 16 B737-700 6 4 7 3 10 10 A321NEO 1 1 1 1 1 A321 15 8 7 15 15 -3 A320NEO 1 1 1 A320 37 4 3 30 37 37 -2 A319 13 9 4 13 13 -4 A318 6 4 2 6 6 -3 A220-300 32 22 10 32 32 17 Total Medium-Haul 103 42 117 94 11 157 262 260 22 Canadair Jet 1000 2 2 2 Embraer 195 E2 18 18 18 18 4 Embraer 190 21 30 17 4 30 51 50 1 Embraer 175 17 3 14 17 17 Embraer 170 13 10 3 13 13 Total Regional 36 65 0 32 18 51 101 98 5 B747-400ERF 3 3 3 3 B747-400BCF 1 1 1 1 B777-F 2 2 2 2 Total Cargo 2 4 0 4 0 2 6 6 0 Total 258 176 117 201 70 280 551 541 36
2023 TRAFFIC
Passenger network activity
Fourth quarter Year to date Total network airlines 2023 2022 variation 2023 2022 variation Passengers carried (‘000s) 17,736 16,490 8% 72,101 64,968 11% Revenue pax-kilometers (m RPK) 57,527 54,373 6% 232,334 205,667 13% Available seat-kilometers (m ASK) 67,333 63,216 7% 267,061 245,391 9% Load factor (%) 85% 86% -1pt 87% 84% 3pt Long-haul Passengers carried (‘000s) 6,407 6,119 5% 25,652 22,887 12% Revenue pax-kilometers (m RPK) 47,987 45,465 6% 191,386 168,184 14% Available seat-kilometers (m ASK) 55,654 52,138 7% 217,864 198,817 10% Load factor (%) 86% 87% -1pt 88% 85% 3pt North America Passengers carried (‘000s) 2,217 2,063 7% 9,192 8,279 11% Revenue pax-kilometers (m RPK) 15,709 14,792 6% 65,290 59,375 10% Available seat-kilometers (m ASK) 18,293 17,101 7% 74,667 70,608 6% Load factor (%) 86% 86% -1pt 87% 84% 3pt Latin America Passengers carried (‘000s) 850 859 -1% 3,480 3,102 12% Revenue pax-kilometers (m RPK) 8,047 8,175 -2% 33,025 29,502 12% Available seat-kilometers (m ASK) 9,060 9,031 0% 36,536 33,097 10% Load factor (%) 89% 91% -2pt 90% 89% 1pt Asia / Middle East Passengers carried (‘000s) 1,463 1,149 27% 5,341 3,623 47% Revenue pax-kilometers (m RPK) 11,516 8,544 35% 41,762 26,104 60% Available seat-kilometers (m ASK) 13,516 10,060 34% 47,924 32,913 46% Load factor (%) 85% 85% 0pt 87% 79% 8pt Africa Passengers carried (‘000s) 1,020 1,040 -2% 4,144 3,870 7% Revenue pax-kilometers (m RPK) 6,370 6,358 0% 25,548 23,170 10% Available seat-kilometers (m ASK) 7,524 7,449 1% 29,804 27,973 7% Load factor (%) 85% 85% -1pt 86% 83% 3pt Caribbean / Indian Ocean Passengers carried (‘000s) 856 1,007 -15% 3,495 4,012 -13% Revenue pax-kilometers (m RPK) 6,345 7,595 -16% 25,762 30,032 -14% Available seat-kilometers (m ASK) 7,260 8,496 -15% 28,933 34,225 -15% Load factor (%) 87% 89% -2pt 89% 88% 1pt Short and Medium-haul Passengers carried (‘000s) 11,329 10,371 9% 46,450 42,081 10% Revenue pax-kilometers (m RPK) 9,541 8,909 7% 40,948 37,483 9% Available seat-kilometers (m ASK) 11,679 11,079 5% 49,197 46,574 6% Load factor (%) 82% 80% 1pt 83% 80% 3pt
Transavia activity
Fourth quarter Year to date Transavia 2023 2022 variation 2023 2022 variation Passengers carried (‘000s) 4,611 4,505 2% 21,464 18,355 17% Revenue seat-kilometers (m RSK) 8,163 7,983 2% 37,800 31,834 19% Available seat-kilometers (m ASK) 9,692 9,416 3% 42,445 37,369 14% Load factor (%) 84% 85% -1pt 89% 85% 4pt
Total Group passenger activity
Fourth quarter Year to date Total Group 2023 2022 variation 2023 2022 variation Passengers carried (‘000s) 22,347 20,995 6% 93,565 83,323 12% Revenue pax-kilometers (m RPK) 65,691 62,356 5% 270,134 237,501 14% Available seat-kilometers (m ASK) 77,024 72,632 6% 309,505 282,761 9% Load factor (%) 85% 86% -1pt 87% 84% 3pt
Cargo activity
Fourth quarter Year to date Cargo 2023 2022 variation 2023 2022 variation Revenue tonne-km (m RTK) 1,772 1,757 1% 6,550 6,889 -5% Available tonne-km (m ATK) 3,577 3,407 5% 14,076 13,260 6% Load factor (%) 50% 52% -2pt 47% 52% -5pt
Air France activity
Fourth quarter Year to date Total Passenger network activity 2023 2022 variation 2023 2022 variation Passengers carried (‘000s) 10,025 10,153 -1% 41,769 39,130 7% Revenue pax-kilometers (m RPK) 34,581 33,137 4% 139,682 123,378 13% Available seat-kilometers (m ASK) 40,610 38,248 6% 160,725 146,731 10% Load factor (%) 85% 87% -1pt 87% 84% 3pt Long-haul Passengers carried (‘000s) 4,026 3,824 5% 15,993 14,261 12% Revenue pax-kilometers (m RPK) 29,496 27,671 7% 116,500 101,245 15% Available seat-kilometers (m ASK) 34,400 31,583 9% 132,924 119,431 11% Load factor (%) 86% 88% -2pt 88% 85% 3pt Short and Medium-haul Passengers carried (‘000s) 5,999 6,328 -5% 25,777 24,868 4% Revenue pax-kilometers (m RPK) 5,085 5,466 -7% 23,182 22,133 5% Available seat-kilometers (m ASK) 6,210 6,665 -7% 27,801 27,300 2% Load factor (%) 82% 82% 0pt 83% 81% 2pt Cargo activity Revenue tonne-km (m RTK) 910 929 -2% 3,307 3,559 -7% Available tonne-km (m ATK) 2,050 1,953 5% 7,989 7,497 7% Load factor (%) 44% 48% -3pt 41% 47% -6pt
KLM activity
Fourth quarter Year to date Total Passenger network activity 2023 2022 variation 2023 2022 variation Passengers carried (‘000s) 7,711 6,337 22% 30,332 25,838 17% Revenue pax-kilometers (m RPK) 22,946 21,236 8% 92,652 82,289 13% Available seat-kilometers (m ASK) 26,722 24,968 7% 106,336 98,660 8% Load factor (%) 86% 85% 1pt 87% 83% 4pt Long-haul Passengers carried (‘000s) 2,381 2,294 4% 9,659 8,626 12% Revenue pax-kilometers (m RPK) 18,491 17,793 4% 74,885 66,939 12% Available seat-kilometers (m ASK) 21,254 20,555 3% 84,940 79,386 7% Load factor (%) 87% 87% –pt 88% 84% 4pt Short and Medium-haul Passengers carried (‘000s) 5,330 4,043 32% 20,673 17,212 20% Revenue pax-kilometers (m RPK) 4,456 3,443 29% 17,766 15,350 16% Available seat-kilometers (m ASK) 5,468 4,413 24% 21,396 19,274 11% Load factor (%) 81% 78% 3pt 83% 80% 3pt Cargo activity Revenue tonne-km (m RTK) 862 828 4% 3,244 3,330 -3% Available tonne-km (m ATK) 1,526 1,453 5% 6,087 5,762 6% Load factor (%) 56% 57% 0pt 53% 58% -4pt
1 against a constant fuel price, constant currency and excluding Emission Trading Scheme cost (ETS) 2 Excluding Transavia
What was Air France-KLM's operating margin in 2023?
Air France-KLM's operating margin in 2023 was 5.7%, up by +1.2pt from the previous year.
How much did net debt decrease by in 2023?
Net debt decreased by €1.3 billion in 2023 for Air France-KLM.
What major achievement did Air France-KLM make in terms of aircraft orders?
Air France-KLM placed a historic order for fifty Airbus A350s with purchase rights for forty additional aircraft.
What was the outcome of the 'Partners for the future' employee shareholding offer?
Approximately 22% of eligible employees subscribed to the 'Partners for the future' employee shareholding offer.
What is the outlook for Air France-KLM in 2024?
The outlook for 2024 includes a 5% capacity increase, unit cost expectations, and net capex projections for Air France-KLM.