Air France-KLM's first quarter 2023 revenue increased by over 40% year-on-year to €6.3bn due to "strong market demand".
The group reported a loss of €344 million, an improvement of over €200 million, and an operating loss of €306 million, with the operating margin of -4.8% an beating Q1 2022's 7.9%.
The group ended the Q1 2023 period with €9.7bn "cash at hand" and adjusted operating free cash flow of €683 million. Net debt was down by €900 million to €5.5bn compared to Q4 2022, as "continued deleveraging", including the repayment of all state aid, left it with a net debt/EBIDTA ratio of 1.5x, down from 1.8x quarter-on-quarter.
"Last year, the operating result benefitted from a €210 million furlough contribution. Corrected for this furlough contribution, the improvement of the operating result amounted to €254 million," the group further explained.
Passenger traffic rose 35% to almost 20 million, while capacity was increased by 19.8%, meaning the load factor went up 11.8 points year-on-year, with group passenger unit revenue per available seat kilometre up by 35.3%.
Cargo revenue declined "compared to an exceptionally strong first quarter last year", the group added, with the drop measured at 11.6% to €209 million. Maintenance revenue topped €900 million after a 11.4% increase. Fuel spending topped €1.7bn, a 79% y/y increase.
Chief executive Benjamin Smith saying the group "further capitalised on the recovery momentum in the airline industry" and "continued to show strong revenue growth as well as robust cash flow generation thanks to the very encouraging summer ticket sales".
"I am also pleased that we have now fully repaid all state aid, which releases us from the associated restrictions and gives us back our full strategic autonomy," Smith added.
The group said it was starting "exclusive discussions" with Apollo Global Management for a €500 million quasi equity financing into an affiliate owning engineering and maintenance assets, adding that it had "received several non-binding offers on quasi equity financing" supported by its loyalty programme.
Looking ahead, the group said it expects to operate at 95% capacity for 2023, after topping that level by Q4,
The group "expects for full year 2023 a stable unit cost, against a constant fuel price, constant currency and excluding furlough contribution, compared to FY 2022" and estimated the year's net capex would be €3bn.