Air France-KLM to merge cargo figures with overall financial results
Following years of heavy airfreight losses, Air France-KLM’s cargo sector results will be reported within its overall financial reporting. The accounting decision will take the struggling cargo arm out of the public eye.
“It has been decided to change the cargo reporting as per fiscal year 2017 based on contribution margin and to include it in the passenger network results. This change will be effective as from the Q1 2017 results presentation,” the group said.
Cargo revenues fell especially hard last year, down 14.7 percent to €2.06 billion, as the world’s most storied combined cargo carriers struggled to keep up in a competitive marketplace. AF-KLM blamed “weak global trade and structural industry overcapacity, and to maximize its contribution to the group.”
AF-KLM said that, starting this year, the financial performance of its cargo business would be merged within the overall financial results of the wider AF-KLM airline’s operations and calculated on the basis of the cargo business’s “contribution margin.”
During full-year 2016, AF-KLM Cargo cut freighter capacity by 24 percent, reducing the number of freighters in operation to six. Freighter operating losses were reduced by €14 million, compared with the previous year, resulting in a full-year 2016 operating loss of €28 million for the company’s freighter activities.
Overall freight capacity was down 4.6 percent, and load factors were down by 1.1 percentage points. And while the losses tied to its freighter operations have eased, the unit’s overall cargo losses are ongoing, at least under the old accounting method.
The carrier’s cargo business posted operating losses of €244 million for 2016, essentially unchanged from 2015’s full-year operating loss of €245 million. Meanwhile, 2016’s cargo tonnage was down 6.2 percent at 1.13 million tonnes, with revenue tonne kilometers down 6.3 percent.
Those interested in learning more about airfreight in 2017, should join us at Cargo Facts Asia in Shanghai, 25 – 26 April. To register, or for more information, go to CargoFactsAsia.com
