Air France-KLM Group revenues for 2022 came to €26.4bn (US$28.03bn) and included its highest ever fourth quarter (Q4) of over €7bn.
The group reported an operating result at €1.2bn with operating margin at 4.5% above 2019 level, which it said came despite high fuel prices, with a positive net income of €700 million.
"In response to the rise in fuel prices and other external costs, the group proceeded to several fare increases during 2022 across all flights. The amount of the increase varied according to destination and class of travel, and applied to flights operated by Air France and KLM," it said.
The group finished the year reporting a positive adjusted operating free cash flow of €1.9bn and "solid cash at hand" of €10.6bn, with net debt down by €1.9bn compared to 12 months earlier.
In Q4 2022, revenues were up 47.3% compared to Q4 2021 with full-year revenues up 84.4%, improvements the group said were "driven by an increase in capacity, load factor and passenger yield".
The group's airlines "welcomed 83.3 million passengers" in 2022, up 86.5%, with capacity up 44.2% and traffic 104.6%. Group passenger unit revenue per available seat kilometre increased by 51.6% against a constant currency compared to last year, with unit costs down 4.5%.
Reviewing some of the year's highlights, the group re-stated that in June it successfully completed a €2.256bn rights issue, of which €1.6bn were allocated to the partial redemption of the €3bn perpetual hybrid instruments held by the French state.
The same month, KLM "fully redeemed its RCF and Dutch state loan, followed in July by Air France-KLM and Apollo closing a €500 million transaction "whereby Apollo subscribed to perpetual bonds issued by an Air France ad hoc operating affiliate that owns a pool of spare engines dedicated to the airline’s engineering and maintenance".
In November, Air France-KLM “successfully placed undated deeply subordinated unsecured bonds convertible into new shares and/or exchangeable for existing shares, for a nominal amount of around €300 million”. The group said it "continued to deleverage and reprofile its unsecured debt with an agreement with the French state and the syndicate of nine banks.
Air France-KLM intends to “fully exit” a €1.2bn French state recapitalisation" by April 2023, it said, with KLM "to exit the current Dutch state framework with banks & state loans being replaced by a sustainability linked revolving credit facility" at around the same time.
The group plans to introduce new generation aircraft to its fleet and phase out old generation aircraft - which so far has resulted in a reduction of 15 aircraft. The process will continue into 2023, when its first Airbus A320neo/A321neo will be delivered, "and beyond".
“Throughout 2022, Air France-KLM once again demonstrated its resilience and agility in a context of unprecedented crises.," said chief executive Benjamin Smith.
In a separate statement, KLM said it "exceeded expectations" in most markets in 2022, with Asia the exception, while cargo traffic and Transavia also fared well, with 7.7 million passengers weighed against KLM's almost 26 million.
Among the operational highlights mentioned, KLM said it " continued its drive towards operational sustainability" by making it "standard practice to add 0.5% sustainable aviation fuel (SAF) to the fuel systems of flights departing from Amsterdam and doubled that amount to 1% as of this year".
At the same time, KLM conceded it faced "issues during operational ramp-up" after curbs were removed, which in turn prevented it from" delivering the level of service to which customers are accustomed". It also cited "operational problems at Schiphol", the Amsterdam airport that is its main hub.
Despite the recovery, the Dutch carrier sounded the alarm about "a number of uncertainties in 2023", listing "geopolitical tensions, inflation, a possible recession and the high price of fuel".
"Major challenges remain, but the 2022 results give us reason to be cautiously optimistic. We are indebted to our customers and our dedicated employees for this. The Dutch are eager to continue flying and we see more people travelling worldwide, said chief executive Marjan Rintel, who warned the carrier would need to exercise cost control in 2023.
The rebound for air travel in turn enabled KLM to repay the loans it received from the Dutch government as part of its support package in the second quarter of 2022," said Erik Swelheim, the chief financial officer, who all the same cautioned that it still owed the government €1.4bn in deferred wage tax.