KLM gives bigger brother a boost as Air France profits hit by terror attacks and strikes

  • Operating profit rises from €780m in 2015 to €1.05bn last year
  • Operating profit at Air France fell 54pc to €372m
  • KLM’s operating profit up 80pc to €681m

Air France KLM group has reported a 35pc earnings increase for 2016 and said it will boost passenger capacity this year in a push in the lucrative long-haul market.

Operating profit increased to €1.05bn, boosted by a lower fuel bill and productivity gains at Dutch arm KLM, while Air France was hit by industrial action and terrorists attacks in France.

Jean-Marc Janaillac CEO of Air France-KLM

Chief Executive Officer Jean-Marc Janaillac said in a statement that while political and economic uncertainties are continuing to weigh on fares amid industry overcapacity, the group will lift capacity as much as 3.5pc in 2017 “in order to regain the offensive” in long-haul markets and boost performance on medium-distance routes. Rival Lufthansa plans to increase capacity by 4pc this year.

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Profit at the main Air France arm fell 54pc to €372m, with visitors staying away amid a spate of terror attacks spanning Paris to Nice and two strikes involving pilots and cabin crew opposed to cost cuts proposed by former boss Alexandre de Juniac.

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