Air France-KLM posts loss, aims to buy Alitalia

Share swap for Alitalia in 2013 will depend on share-price rebound

After posting a hefty operating loss of €353 million for 2011, in stark contrast to the €28 million profit seen the previous year, Air France-KLM warned that heavy fuel bills would hit profits again in 2012. It expects fuel costs to hit €1.1 billion this year, forcing operating profit for the first half of 2012 lower than for the same period in 2011.
“The economic outlook remains uncertain while the fuel price remains at a record level in euros,” the company said. However, the first effects of the airline’s new three-year turnaround plan should be felt in H2 2012, it added.
Meanwhile, the newspaper La Tribune has reported that Air France-KLM wants to buy Alitalia in 2013 in a share swap. But this method of purchase will depend on whether its share price rebounds – and how quickly the company can return to profitability. According to the newspaper report, getting full control of Alitalia is a major concern of group chairman Jean-Cyril Spinetta, who is also a board member of the Italian airline.
Reuters / ATW