By Mauro Orru
Shares of Air France-KLM plunged Friday after the Franco-Dutch carrier group posted revenue and profit below analysts’ expectations as it grapples with lingering inflation and high fuel prices.
At 0730 GMT, Air France-KLM shares traded 6.7% lower at EUR10.27.
The carrier group on Friday posted revenue of 8.66 billion euros ($9.15 billion) for the three months to the end of September, up 6.8% on year. The group handled 26.9 million passengers in the quarter, 7.6% more than last year.
“This performance was driven by strong summer demand,” said Chief Executive Benjamin Smith.
Net profit jumped to EUR931 million from EUR460 million. Operating profit climbed to EUR1.34 billion from EUR1.02 billion, generating a 15.5% operating margin.
However, the group was expected to post revenue of EUR8.72 billion on a net profit of EUR957 million and operating profit of EUR1.37 billion, according to a company-provided consensus based on estimates from 15 financial analysts.
For months, Air France-KLM has been reckoning with inflation-driven costs that mainly stem from higher salaries, but also air traffic control charges and airport fees. The group is forecasting a low single-digit on-year increase in costs this year.
Citi analysts wrote in a note to clients that fuel costs of EUR1.92 billion for the quarter came in 4% higher than consensus.
The carrier continues to expect capacity this year to be at roughly 95% of 2019 levels.
Write to Mauro Orru at mauro.orru@wsj.com
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