Monthly Archives: October 2020

Condor will fly from Zurich to the most popular vacation destinations in summer 2021

Condor Flugdienst has made this announcement:

Germany’s most popular leisure airline says “Hello Switzerland”: Condor is stationing two Airbus A320s in Zurich for the 2021 summer season and will then fly to nine of the most popular vacation destinations around the Mediterranean several times a week from there.

Condor will start with 28 flights to Palma de Mallorca, Tenerife, Gran Canaria, as well as to Greece (Crete, Kos, Rhodes), Cyprus (Larnaca), Sardinia (Olbia) and Split in Croatia. Condor is thus responding to the great demand from leading Swiss tour operators for tailor-made vacation flights and is supplementing the existing eight German departure airports for the first time with the largest Swiss airport, Zurich.

Overview:

Palma de Mallorca (Spain) – Daily

Tenerife (Spain) – Monday, Friday

Gran Canarias (Spain) – Wednesday, Saturday

Heraclion (Crete) – Monday, Wednesday, Saturday

Kos – Tuesday, Friday

Rhodes – Thursday, Sunday

Olbia (Sardinia) – Monday, Wednesday, Thursday, Saturday

Split (Croatia) – Tuesday, Friday, Sunday

Larnaca (Cyprus) – Tuesday, Thursday, Sunday

Condor aircraft photo gallery:

Air France-KLM Group loses 1,665 million euros in the third quarter

Air France-KLM Group issued this financial report:

The continuation of the Covid-19 crisis severely impacted the Third quarter 2020 results:

  •   Revenue at 2,524 million euros, down 67% compared to last year
  •   EBITDA loss at -442 million euros, limited thanks to cost control and state aid
  •   Operating result at –1,046 million euros, down 1,955 million euros compared to last year
  •   Net income at -1,665 million euros, including restructuring provision at -565 million euros, Covid-19 related over-hedging at -39 million euros and fleet impairment at -31 million euros
  •   Net debt at 9,308 million euros, up 3,161 million compared to end of 2019
  •   At 30 September 2020, the Group has 12.4 billion euros of liquidity or credit lines at disposal

    Air France and KLM have agreed with labour representatives on substantial restructuring plans and submitted them for final validation to the French and Dutch states.

    OUTLOOK

    Air France-KLM Group continues to implement the highest safety standards for its customers and employees to counter virus transmission risks.

    After the lockdown, the Group observed a positive demand recovery trend until mid-August. Then, the negative trend reversal for the Passenger activity led the airlines of the Group to adjust downwards the capacity planned for the fall and winter period.

    There is limited visibility on the demand recovery curve as customer booking behavior is much more short-term oriented and also highly dependent on the imposed travel restrictions, especially on the Long Haul network. The period of lockdown starting today in France is a new difficulty that will weigh on the Group’s activities.

    In this context the Group expects:

  •   Capacity in Available Seat kilometers circa index 45 for KLM and inferior to index 35 for Air

    France in the Fourth quarter 2020 compared to 2019 for the Network passenger activity

  •   Negative load factor developments for the Fourth quarter 2020, particularly on the long-haul

    network, and negative yield mix effects due to a delayed recovery in business traffic

    The Group anticipates a challenging fourth quarter 2020, with a substantial lower EBITDA compared to Q3 2020.

THIRD QUARTER 2020
Increase of demand until mid-August,
then new governmental restrictions impacted the expected level of demand recovery

Air France-KLM Group

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Third quarter

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Nine months

2020 Change

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2020 Change 1

Passengers (thousands)
Passenger Unit revenue per ASK1 (€ cts) Operating result (€m)
Net income – Group part (€m)
Adj. operating free cash flow (€m)
Net debt at end of period (€m)

8,796 4.01 -1,046 -1,665 -1,220

-69.8% -42.7% -1,955 -2,026 -985

28,124 5.05 -3,414 -6,078 -3,547 9,308

-64.7% -24.5% -4,460 -6,213 -3,663 3,161

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1 Passenger unit revenue is the aggregate of Passenger network and Transavia unit revenues, change at constant currency
1

The Board of Directors of Air France-KLM, chaired by Anne-Marie Couderc, met on 29 October 2020 to approve the financial statements for the nine months 2020. Group CEO Mr. Benjamin Smith said: “After a promising recovery during the summer, the gradual closure of international borders in the second half of August and the resurgence of the pandemic strongly impacted our results in the Third Quarter, with the Group reporting an operating loss of 1.0 billion euros. We have accelerated the implementation of cost reduction and cash preservation measures. We are also working closely with our partners on various means, such as rapid detection tests, that would allow traffic within the best sanitary conditions for our customers and employees.

Beyond these immediate necessary measures, we are engaged in a more profound transformation of our Group, with the objective of exiting this crisis in a stronger position, ready to address the future challenges of our industry. Air transport will continue to connect people and cultures, but we foresee changes in customers’ expectations that we anticipate too.

We expect a challenging Fourth quarter 2020, with current forward booking sharply down compared to last year.”

Business review

Network: With active management of capacity to meet the increasing demand, the Group was able to ramp up capacity with incremental cash positive flights

Third quarter 2020 revenues decreased by 68.3% at constant currency to 2,004 million euros. The operating result amounted to -990 million euros, a -1,631 million euros decrease at constant currency compared to last year. Measures were strengthened to preserve cash, including reduction of investments, cost savings measures, deferral of supplier payments and partial activity for employees.

Passenger network: Long-haul suffering from travel restrictions, ability to capture traffic when border controls are less restrictive

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Network

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Third quarter

Nine months

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2020 Change Change constant currency

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2020 Change Change constant currency

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Total revenues (€m) Scheduled revenues (€m) Operating result (€m)

2,004 1,856 -990

-68.6% -69.8% -1,649

-68.3% -69.4% -1,631

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7,220

6,753 -2,842

-58.8% -59.7% -3,555

-58.8% -59.7% -3,564

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Passenger network

Third quarter

Nine months

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2020 Change Change constant currency

2020 Change Change constant currency

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Passengers (thousands) Capacity (ASK m) Traffic (RPK m)
Load factor

Total passenger revenues (€m) Scheduled passenger revenues (€m) Unit revenue per ASK (€ cts)

6,782 -71.3% 32,100 -59.6% 13,752 -80.7%

42.8% -46.9 pt 1,329 -77.4% 1,265 -77.9%

3.94 -45.2%

-77.1% -77.6% -44.5%

23,671 -64.3% 103,268 -54.1% 66,861 -66.3% 64.7% -23.5 pt 5,512 -65.4% 5,271 -65.7% 5.10 -25.4%

-65.4% -65.7% -25.3%

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The passenger network activity was, as anticipated strongly reduced, at around 40% of last year’s levels. The tightening of travel restrictions, border closures and absence of corporate travel delayed the expected traffic recovery. July and August were relatively strong in term of traffic compared to a disappointing September affected by restrictive travel measures.

For the third quarter, the unit revenues were down at -44.5% at constant currency compared to last year primarily due to load factors decline on Long Haul operations.

2

The Group’s strategy was to only operate incremental cash positive flight and several routes were taking advantage of the strong worldwide cargo demand while having few passenger on board.

The visiting friend and relative demand was driving the summer traffic, with the French Domestic, African & Middle East and Caribbean & Indian Ocean as the more resilient with a unit revenue performance between -22% and -27% at constant currency.

The medium-haul performance was mixed during summer, with some leisure destinations such as Italy, Spain, Portugal and Greece benefiting from easing travel restrictions and other strongly affected by quarantine and testing process like UK or Germany.

North Atlantic, South American and Asian networks continued to be strongly affected by the border restrictions in place with an important decline in capacity and passenger traffic during summer.

Cargo: Continued strong performance of cargo due to the gap between industry capacity and demand

Cargo business

Third quarter

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Nine months

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2020 Change Change constant currency

2020 Change Change constant currency

Tons (thousands) Capacity (ATK m) Traffic (RTK m) Load factor

Total Cargo revenues (€m) Scheduled cargo revenues (€m) Unit revenue per ATK (€ cts )

220 2,537 1,735 68.4% 676 592 23.35

-20.0% -33.3% -17.0%

+13.4 pt +31.7% +35.7%

+104.0%

+34.1%

+38.0% +107.6%

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611 7,309 4,747 65.0% 1,708 1,482 20.28

-25.7% -32.9% -24.2% +7.5 pt

+7.1%

+8.7% +62.0%

+6.9%

+8.4% +61.6%

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Global air cargo capacity is at the end of the Third quarter 2020 approximately 15% lower than 2019. Tightening of supply and demand levels increased yields by significant amount over the past months.

September was the fifth consecutive month of gradual air cargo market improvements and Air France- KLM’s Cargo activity continued to strongly perform with a unit revenue at constant currency up 104.0% in the Third quarter 2020. The Cargo capacity of the Group has been down 33.3%, primarily driven by the reduction in belly capacity of passenger aircraft partly offset by the increase of the full freighters’ capacity and mini cargo flights (passenger aircraft with only belly capacity commercialized). The load factors were strongly up 13.4 points for the quarter.

On the demand side, world-wide air freight volumes are down due to Covid-19 crisis but are expected to rebound to 90 to 95% of pre Covid-19 levels in 2021. The supply-demand gap of the past months is foreseen to narrow as industry capacity supply will increase and will depend on the passenger traffic recovery. Air France-KLM is in preparation to transport the future Covid-19 vaccines.

3

Transavia operating loss in the Third quarter at -13 million euros, impacted by border restrictions reinstatement

Transavia

Third quarter

Nine months

2020 Change

2020 Change

Passengers (thousands) Capacity (ASK m) Traffic (RPK m)
Load factor

Total passenger revenues (€m) Unit revenue per ASK (€ cts) Unit cost per ASK (€ cts) Operating result (€m)

2,014 -63.3% 6,009 -44.7% 3,869 -61.8%

64.4% -28.7 pt 262 -60.6% 4.38 -30.2% 4.61 -1.3% -13 -189

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4,453 11,178 8,505 76.1% 521 4.55 6.39 -206

-66.6% -57.4% -64.9% -16.4 pt -62.9% -16.3%

+32.5% -364

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The Third quarter operating result ended 189 million euros lower compared to last year at an operational loss of -13 million euros, as a result of the Covid-19 crisis.

Activity levels were close to 55% of last year’s level, with an unit revenue down -30,2% compared to the Third quarter 2019. Transavia France and Holland were able to capture traffic and fill their planes with reasonable load factors and good yields on several leisure destinations. Spain, Greece, Portugal and Italy routes were the most resilient during the quarter. However, severe travel restrictions from the Netherlands to Spain and Greece in the course of the third quarter, did put pressure on activity levels and loadfactor.

Transavia France will expend its French Domestic operation starting in November 2020 from Paris Orly and provinces airports.
However, the resurgence of Covid-19 and border restrictions have slowed down Transavia in the traffic recovery.

Strict cash preservation measures are still in place including reduction of investments, cost savings measures, deferral of supplier payments and partial activity measures.

Maintenance business operating result for Third quarter 2020 at -46 million euros, impacted by Covid-19

Maintenance

Third quarter

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Nine months

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2020 Change Change constant currency

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2020 Change Change constant currency

Total revenues (€m) Third-party revenues (€m) Operating result (€m) Operating margin (%)

616 247 -46 -7.4%

-47.1% -54.5% -117 -13.5 pt

-53.1%

-111

-13.1 pt

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2,255 963 -366 -16.2%

-34.7% -40.7% -536 -21.2 pt

-41.6%

-542

-21.3 pt

The Third quarter operating result stood at -46 million euros, a decrease of 117 million euros, highly impacted by the Covid-19 crisis. Revenues declined and were also impacted by the Air France-KLM Group airlines decrease in activity.

During the Third quarter, contracts signature have restarted and will be included in the order book before year end. The Maintenance business is carefully managing agreements with clients on payment terms.

Operating costs have been reduced in the Third quarter 2020 by a reduced maintenance activity level, partial activity pay schemes for employees and other initiated cost savings measures.

The Maintenance order book is assessed to 9.3 billion dollars at 30 September 2020 a decrease of 2.2 billion dollars compared to 31 December 2019, explained by the Covid-19 crisis effects already occurring and expected.

4

Air France-KLM Group: Decline of 5 billion euros in revenues and 2 billion euros in EBITDA during the third quarter

Third quarter

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Nine months

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2020 Change Change constant currency

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2020 Change Change constant currency

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Capacity (ASK m)

Traffic (RPK m)

Passenger unit revenue per ASK (€ cts)

Group unit revenue per ASK (€ cts)

Group unit cost per ASK (€ cts) at constant fuel

38,109 17,621

4.01 5.56 8.31

-57.8% -78.4%

-43.4% -26.5% +26.7%

-42.7% -25.6% +38.2%

114,446 75,367

5.05 6.34 9.33

-54.4% -66.2%

-24.6% -12.3% +36.7%

-24.5% -12.3% +40.4%

Revenues (€m)
EBITDA (€m)
Operating result (€m) Operating margin (%)
Net income – Group part (€m)

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2,524 -442 -1,046 -41.4% -1,665

-66.8%

-2,095

-1,955

-53.4 pt -2,027

-66.4%

-2,071

-1,931

-53.2 pt

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8,725 -1,282 -3,414 -39.1% -6,078

-57.6%

-4,545

-4,460

-44.2 pt -6,213

-57.7%

-4,554

-4,470

-44.2 pt

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2019 results restated for LLP componentization accounting change and EU passenger compensation reclassification between revenues and external expenses

In the Third quarter 2020, the Air France-KLM Group posted an operating result of -1,046 million euros, down by 1,955 million euros compared to last year.

Net income amounted to -1,665 million euros in the Third quarter 2020, a decrease of 2,027 million euros compared to last year, of which exceptional accounting items due to Covid-19:

  •   Restructuring costs provision of-565 million euros with Departure Plan of French Ground staff, contractual termination for Air France flight attendants, complement for contractual termination for Air France pilots, Departure Plan for Air France-KLM International Commercial staff and Departure Plan for HOP!
  •   Q4 2020 and Q1 2021 fuel over hedge has been recycled to “Other financial income and expenses” for -39 million euros
  •   Fleet impairment on Airbus A380 and the Canadair Jet of HOP! At -31 million euros Currencies had a negative 92 million euro impact on revenues and a positive 67 million euro effect on

    costs including currency hedging in the Third quarter of 2020.

    Since the beginning of the crisis, Air France, KLM and Transavia proceeded 1.8 billion euros of refunds including 300 million euros of voucher issued.

    The Third quarter 2020 unit cost increased by 26.7%, primarily caused by Covid-19 related capacity reductions

    Group net employee costs were down 36% in the Third quarter 2020 compared to last year, supported by partial activity implementation at Air France and KLM, release of temporary and hired staff and no profit sharing provisions to be made at both airlines. The average number of FTEs (Full Time Equivalent) in the Third quarter 2020 decreased by 5,500 compared to the Third quarter 2019, including 2,500 temporary contracts.

5

Net debt up 3.2 billion euros

In € million

Third quarter

Nine months

2020 Change

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2020 Change

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Cash flow before change in WCR and Voluntary Departure Plans, continuing operations (€m)

Cash out related to Voluntary Departure Plans (€m) Change in Working Capital Requirement (WCR) (€m) Net cash flow from operating activities (€m)
Net investments* (€m)

Operating free cash flow (€m)

Repayment of lease debt

Adjusted operating free cash flow**

-594 -2,115

-137 -115 124 +831 -609 -1,399-362 +418 -970 -981 -251 -5-1,220 -985

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-1,926 -4,950

-152 -119 666 +582 -1,412 -4,487 -1,473 +738 -2,885 -3,749 -662 +86 -3,547 -3,663

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* Sum of ‘Purchase of property, plant and equipment and intangible assets’ and ‘Proceeds on disposal of property, plant and equipment and intangible assets’ as presented in the consolidated cash flow statement.
** The “Adjusted operating free cash flow” is operating free cash flow after deducting the repayment of lease debt.

The Group generated adjusted operating free cash flow in the Third quarter 2020 of -1,220 million euros, a decrease of 985 million euros compared to last year, mainly explained by an operating cash flow decline of 1,399 million euros, partly offset by a reduction in net investments of 418 million euros.

Postponement of social charges, taxes and negotiation with suppliers compensated the refunds process and the low inflow of bookings and generated an improvement of +582 million euros in Change in Working Capital Requirement compared to last year.

In € million

Both airlines results negatively impacted in the Third quarter 2020

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30 Sep 2020

31 Dec 2019

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Net debt
EBITDA trailing 12 months

9,308 -417

6 147 4 128

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Net debt/EBITDA trailing 12 months

-22.3 x

1,5 x

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Third quarter

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Nine months

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2020 Change

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2020 Change

Air France Group Operating result (€m)

Operating margin (%)

KLM Group Operating result (€m)

Operating margin (%)

-807 -54.1% -234 -20.5%

-1,200 -62.6 pt -745 -36.8 pt

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-2,401 -47.4% -1,002 -25.2%

-2,699 -49.8 pt -1,736 -33.9 pt

6

OUTLOOK

Air France-KLM Group continues to implement highest safety standards for customers and employees to counter virus transmission risks.

After the lockdown, the Group observed a promising demand recovery trend until mid-August. Then, the negative trend reversal for the Passenger activity led the airlines of the Group to adjust downwards the capacity planned for the fall and winter period.

There is limited visibility on the demand recovery curve as customer booking behavior is much more short-term oriented than before the Covid-19 crisis and also highly dependent of the imposed travel restrictions, especially on the Long Haul network. The period of lockdown starting today in France is a new difficulty that will weigh on the Group’s activities.

In this context the Group expects:

  •   Capacity in Available Seat kilometers circa index 45 for KLM and inferior to index 35 for Air

    France in the Fourth quarter 2020 compared to 2019 for the Network passenger activity

  •   Negative load factor developments for the Fourth quarter 2020, particularly on long-haul

    network, and negative yield mix effects due to a delayed recovery in business

    The Full year 2020 Network passenger activity will be inferior to index 50 compared to 2019, due to the Covid-19 crisis.

    The Group anticipates a challenging fourth quarter 2020, with a substantial lower EBITDA compared to Q3 2020.

    At 30 September 2020, the Group has 12.4 billion euros of liquidity or credit lines at disposal.

    The Group foresees important liquidity requirements in the Fourth quarter 2020 with:

  •   Negative Fourth quarter working capital requirement influenced by deferred payments and

    substantial lower level of new bookings compared to Q4 2019.

  •   Capex spending at 0.6 billion euros, of which half is fleet Capex fully financed. The Group has

    reduced to 2.1 billion euros his 2020 capex guidance. This is a reduction of -1.5 billion euros

    compared to the initial 2020 guidance of 3.6 billion euros.

  •   The hybrid bond was repaid in October for 0.4 billion euros.

7

AIR FRANCE AND KLM HAVE AGREED ON SUSBTANTIAL RESTRUCTURING PLAN WITH LABOUR REPRESENTATIVES

The Group’s strategic orientations defined during the 2019 Investor day started to deliver results in 2019 and in early 2020. However, the Covid-19 which began in the first quarter of 2020 around the world is having an unprecedented impact on the industry and the Group has immediately reacted with safety, operational and cash protection measures.

The focus on reducing external expenses and the number of employees were one of the top priorities. Futhermore, the French and the Dutch governments have provided financial packages and the partial activity implemented in France and the “NOW” mechanism in Holland allowed the Group to further reduce labor costs.

To weather the crisis and cope with the new reality, Air France-KLM Group is accelerating its transformation plans and presented a substantial restructuring plan around the competitiveness and sustainability pillars. Negotiations with the trade unions have resulted in several agreements in Air France and KLM.

To better align the fleet with the lower passenger demand, Air France-KLM Group has accelerated the phase-out of the Airbus 380, Airbus 340, Boeing 747, Canadair Jet and Embraer 145 aircraft. These decisions will bring forward cost savings and efficiency gains due to operating fewer aircraft types. The Group does not anticipate to return to the pre-crisis levels of global demand before several years and the short-term recovery expected has been delayed with the resurgence of Covid-19 end of summer.

KLM business model is still both valid and valuable but needs to be reshaped to the new reality. KLM will be smaller, cheaper, more frugal, more agile and more sustainable.
Operating costs will structurally being reduced in 2021 and beyond, with 750 million euros benefits in 2021 coming from labour, fleet, procurements and fuel costs decrease.

KLM’s restructuring plan calls for a reduction of 5,000 FTEs end of 2020. The plan submitted to Dutch Government early October complies with state aid conditions.

Air France will enlarge and accelerate its restructuring plan to build a post-crisis successful model on several pillars to restructure the French domestic, optimize external spendings, transform support functions, adapt the opeartions to the new activity, modernize the fleet and regain commercial success.

This will bring 800 million euros structural benefits by 2021 and 1.2 billion euros in total by 2022. Air France’s restructuring plan calls for a reduction of 4,000 FTEs end of 2020 and a total of 8,500 FTEs by 2022. The plan submitted to French Government complies with state aid conditions. The long term partial activity establishement is under discussion with representative unions.

Nordic Aviation Capital delivers one De Havilland Dash 8-400, MSN 4231, to Cobham Aviation Services, 717s to be moved to QANTAS Group

Nordic Aviation Capital (NAC) has confirmed that it has delivered one De Havilland Dash 8-400, MSN 4231, to Cobham Aviation Services on lease. NAC is delighted to welcome Cobham Aviation Services as a new customer.

In other news, the QANTAS Group will bring the operation of its fleet of Boeing 717 aircraft within the Group, after reaching an agreement with Cobham Aviation Services.

Cobham has operated QantasLink’s 20 Boeing 717 aircraft for the past 15 years, predominantly on regional routes across Australia, through National Jet Systems.

Photo: YSSYguy.

National Jet Systems, which holds the air operator certificate for the Boeing 717s and is the employing entity for around 380 employees operating the Boeing 717s, will become a wholly-owned subsidiary of the QANTAS Group.

The terms of the agreement are commercial in confidence, however it is not material for QANTAS and replaces a 10 year contract for services signed in 2016. The transition is on track to be completed in the coming months.

As with most aviation employees in Australia, the majority of the Cobham employees who are part of the QantasLink Boeing 717 operation are temporarily stood down due to the reduction in fights from the Coronavirus. This will remain the case until travel restrictions are lifted and demand returns.

Cobham will continue to operate four dedicated freighters for QANTAS Freight, which predominantly deliver overnight mail and parcels.

NAC delivers one ATR 72-600, MSN 1288, to Amelia on lease

Nordic Aviation Capital (NAC) is pleased to confirm that it has delivered one ATR 72-600, MSN 1288, to Amelia on lease. The aircraft will be leased to Regourd Aviation and operated under the Amelia brand.

Amelia is the brand name of the Amelia Aviation Group (by Regourd Aviation). Created in 1976 by Alain Regourd, the Group is based in Paris and has strong French and European footprints. Its European activities are focused on three complementary businesses: the operation of regional routes on its own account or on a subcontracting basis on behalf of major European airlines, and the chartering of aircraft on a one-off basis.

In 2019, the group carried more than 217,000 passengers and decided to create the Amelia brand to unite its European activities under a single banner. The group has a fleet of 15 aircraft: regional aircraft with 35 to 72 seats and a core fleet of 8 Embraer 145s with 50 seats. The group has 300 employees including 80 pilots.

Kuwait Airways takes delivery of its first two Airbus A330neos

Kuwait Airways, the national airline of Kuwait, has received its first two Airbus A330neos. These aircraft are the first of eight A330neos ordered by the airline.   The carrier currently operates a fleet of 15 Airbus aircraft comprising seven A320ceos, three A320neos and five A330ceos.

This event also marks Airbus’ first A330-800 delivery. The new generation widebody aircraft is the latest addition to Airbus’ product line, highlighting the company’s strategy to keep offering its airline customers unbeatable economics, increased operational efficiency and superior passenger comfort with proven latest technology platforms. Thanks to its tailored mid-sized capacity and its excellent range versatility, the A330neo is considered the ideal aircraft to operate as part of the post-COVID-19 recovery.

Kuwait Airways’ A330neo will comfortably accommodate 235 passengers, featuring 32 fully-flat beds in Business Class and 203 spacious seats in Economy Class while offering a large cargo hold capable of accommodating generous passenger baggage allowances.

Photo: Airbus.

Lufthansa to operate a special flight LH2020 for the opening of BER Airport

Lufthansa has made this announcement:

With the arrival of special flight LH2020 Lufthansa partakes in the opening of the new Berlin Capital Airport BER on October 31, 2020. Lufthansa’s Airbus A320neo “Neubrandenburg” is scheduled to take off from Munich (MUC) at 12:50 p.m. and land at BER on schedule at 2 p.m. In addition to the Chairman of the Executive Board of Deutsche Lufthansa AG, Carsten Spohr, around 40 invited guests will be on board. The special flight is 100 percent carbon-neutral, as all emissions will be offset via the Lufthansa platform Compensaid, using sustainable fuel.

The maiden flight to the new airport underlines Lufthansa’s special and longstanding relationship with the capital. The airline has been flying to Berlin for 30 years. Since September, the Lufthansa Group, which flies to the capital with six of its airlines, has been the market leader in Berlin. The Group’s market share is around 30 percent of all flights – twice as many as the “runner up” to Lufthansa Group’s leading position. No other airline group has flown as many Berliners all over the world in recent decades as the Lufthansa Group.

Customers of Lufthansa Group Airlines can expect an extensive range of services at the new airport to make their travel experience even more pleasant. For example, a new 650 sqm Lufthansa lounge with approx. 150 seats will be opened. It goes without saying that the lounge has been designed in compliance with current hygiene and social distancing regulations. The panoramic window front offers a phenomenal view of the apron and, in good weather, an exclusive view of the famous Berlin TV tower.

Lufthansa, Swiss, Austrian Airlines, Brussels Airlines and Air Dolomiti flights are handled at “Mainpier,” just a short walk from the lounge. Eurowings flights are mainly handled at the north pier.

Regular Lufthansa flight operations at BER from November 8

On November 8, 2020, Berlin-Tegel Airport will close its flight operations and Lufthansa will move to BER. At 6.45 a.m., Lufthansa’s flight LH173 to Frankfurt is scheduled to take off from the new capital airport for the first time. First arrivals at BER are planned for November 7, 2020. Together with Lufthansa, Austrian Airlines and Swiss will start scheduled operations at BER on November 8. Brussels Airlines follows on November 9. Eurowings is moving to BER a few days earlier. On  November 4, a regular EW flight will take off from BER for the first time. The airline, which will be based in T2 in the long term, will initially take off from BER T1. Air Dolomiti will be commence flying to BER in the summer flight schedule.

Overview last/first flights TXL/BER Lufthansa

Last Departures Berlin-Tegel TXL:

7.11.2020 LH201 TXL – FRA 7:45 p.m
7.11.2020 LH1955 TXL – MUC 9:20 p.m

First Arrivals BER:

7.11.2020 LH202 FRA – BER 10:40 p.m.
7.11.2020 LH1958 MUC – BER 10:30 p.m.

First Departures BER:

8.11.2020 LH173 BER – FRA 6:45 a.m.
8.11.2020 LH1959 BER – MUC 7:00 a.m.

First departures BER Lufthansa Group Airlines:

Eurowings

4.11.2020 EW8058 BER – CGN 6:20 a.m.
4.11.2020 EW8000 BER – STR 6:20 a.m.
4.11.2020 EW8040 BER – DUS 6:30 a.m.

SWISS

8.11.2020 LX967 BER – ZRH 14:15 p.m.

Austrian

8.11.2020 OS224 BER – VIE 9:50 a.m.

Brussels Airlines

9.11.2020 SN2582 BER – BRU 11:50 a.m.

KLM loses EUR 234 million ($273.1 million) in the third quarter, scales back for the winter

KLM Royal Dutch Airlines has made this announcement:

The Air France-KLM results for the third quarter of 2020 grimly reconfirm the extent to which the COVID-19 pandemic has disrupted the air transport industry. This is without doubt our deepest crisis since World War II – for broader society, for aviation in general, and certainly for KLM. Our cargo division is performing well and generating extra revenue, but our passenger flights have been scaled down further for the winter season.

Traditionally, the third quarter is especially strong in the air transport industry, but KLM has now incurred a loss of EUR 234 million for the quarter, down EUR 745 million compared to Q3 last year. The result incurred during the first nine months of 2020 has deteriorated by 1,7 billion compared to 2019.

There were cautious signs of recovery in July and August, with an increase in bookings for KLM’s European flights. Regrettably, KLM was forced to respond to changing travel warnings for many European countries in September, downscaling its European network for the winter season, which will result in a further decline in revenues.

A wide array of measures have already been taken to downsize KLM operations in line with the sharp decline in demand and flights. By the end of the year, the KLM Group will have bid farewell to around 5,000 employees (-15%). In view of recent developments prompted by the second wave of the pandemic and the sombre outlook, further rightsizing of the organisation will be considered.

These results confirm just how bad things are in the air transport industry. KLM has incurred a loss of EUR 234 million in the third quarter, down EUR 745 million compared to Q3 last year. Without the Dutch government’s NOW support scheme, we would have incurred a loss of EUR 500 million.
To safeguard the future of our airline and employment opportunities, the loan and loan guarantees offered by the Dutch government are of crucial importance. 
These poor results are certainly no reflection of the continued commitment of KLM employees, who are braving difficult working conditions to keep serving our customers. I greatly appreciate and respect their efforts.
Pieter Elbers – CEO & President KLM

Jet2 to operate new routes to Jersey

Jet2 (Jet2.com) has announced it will operate to Jersey from Birmingham, East Midlands, Manchester, Newcastle and London Stansted Airports this summer.

The airline already operates to the Channel Island destination from Leeds/Bradford.

Details of the new routes:

Birmingham – weekly Saturday services from May 22  to September 25, 2021.

East Midlands – weekly Saturday services from May 22 to September 25, 2021.

Manchester – three weekly services (Tuesdays, Thursdays and Saturdays) from May 20 to September 25, 2021.

Newcastle – weekly Saturday services from May 22 to September 25, 2021.

London Stansted – two weekly services (Tuesdays and Saturdays) from May 22 to September 25, 2021.

Jet2.com aircraft photo gallery:

SkyWest makes a profit in the third quarter, will fly 20 more CRJ700s and 20 E175s for American

SkyWest, Inc. has reported its financial and operating results for Q3 2020, including net income of $34 million, or $0.66 per diluted share, compared to net income of $91 million, or $1.79 per diluted share, for Q3 2019. The primary factor in SkyWest’s lower results in Q3 2020 compared to Q3 2019 was reduced flight schedules and lower demand resulting from the COVID-19 pandemic.

Commenting on the results, Chip Childs, Chief Executive Officer of SkyWest, said, “Over the past several months, we have worked with our partners and our people to respond quickly and aggressively to the worst crisis our industry has experienced. The SkyWest team continues to demonstrate exceptional dedication and flexibility, and I want to thank them for their hard work and focus through this challenge. We are committed and remain laser-focused on ensuring we are positioned for the long-term, maintaining strong liquidity, and delivering on our partners’ objectives in the recovery.”

Financial Results
Revenue was $457 million in Q3 2020, down from $760 million in Q3 2019, due to the COVID-19 pandemic that caused a significant reduction in the number of scheduled flights SkyWest operated under its flying contracts compared to the same period last year. Total block hours in Q3 2020 were down 41% from Q3 2019.

SkyWest deferred recognizing revenue on $30 million of fixed monthly payments received during Q3 2020, down from $69 million of revenue that was deferred in Q2 2020. SkyWest will recognize the deferred revenue based on completed flights over the remaining contract term.

Operating expenses were $383 million in Q3 2020, down from $614 million in Q3 2019 due to fewer flights operated compared to the same period last year, with $190 millionin CARES Act payroll support (described under “Capital and Liquidity” below) recognized as an offset to salaries and wages expense in Q3 2020. SkyWest anticipates recognizing the remaining $3 million in payroll support grants in Q4 2020.

New Deals
SkyWest secured an agreement to place 20 used CRJ700s under a multi-year flying contract with American Airlines. SkyWest anticipates using its own aircraft not currently under contract with a partner to fulfill this agreement. The aircraft are expected to be placed into service ratably throughout 2021. Following the placement of these 20 aircraft, combined with anticipated placement of four CRJ700s in Q4 2020 and five CRJ700s in 2021 under a previously announced deal, SkyWest is scheduled to have a total of 90 CRJ700s under contract with American by the end of 2021. 

SkyWest also secured agreements to acquire 21 used CRJ700s in a 50-seat configuration and lease the aircraft under a multi-year term to another regional airline operating for United Airlines. The aircraft purchases and leases are expected to be completed in Q4 2020.

Status Update on Previously Announced Deals
SkyWest is coordinating with its major airline partners to optimize the timing of upcoming fleet deliveries under previously announced deals in response to COVID-19 schedule reductions. The anticipated future delivery dates summarized below are based on currently available information and are subject to change.

Flying contract with Delta Air Lines (“Delta”)

  • Four new E175 aircraft to be financed and operated by SkyWest are scheduled for delivery in Q4 2020. Normal cash down payments are already covered by deposits paid last year.
  • One new CRJ900 aircraft to be financed by Delta and operated by SkyWest is scheduled for delivery in 2021.

Flying contract with American for E175 aircraft
Twenty new E175 aircraft to be financed and operated by SkyWest:

  • Five aircraft deliveries are anticipated in Q4 2021 and 15 deliveries in 2022
  • SkyWest anticipates financing the aircraft through debt

Flying contract with Delta for CRJ200 aircraft
As previously announced, SkyWest’s capacity purchase agreement with Delta for CRJ200 aircraft is scheduled to expire in 2020. SkyWest owns the remaining 17 CRJ200 aircraft under contract with Delta as of September 30, 2020. SkyWest has no outstanding financing obligations on these 17 CRJ200 aircraft and anticipates these aircraft will be fully depreciated upon removal from the Delta contract.

Capital and Liquidity
SkyWest had $822 million in cash and marketable securities at September 30, 2020, up from $762 million at June 30, 2020. Total debt at September 30, 2020 was $3.1 billion, up from $3.0 billion at June 30, 2020. Capital expenditures during Q3 2020 was $10 million for a spare engine and other maintenance assets.

During Q3 2020, as previously announced, SkyWest and SkyWest Airlines entered into a $573 million, five-year secured loan facility with the U.S. Treasury Department (“Treasury”) under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). SkyWest Airlines borrowed the minimum required $60 million under the facility at closing. In October, SkyWest increased its loan capacity under this facility to $725 million. SkyWest Airlines has until March 2021 to borrow additional amounts under the facility. SkyWest issued warrants to purchase 211,416 shares of common stock to Treasury in conjunction with the initial $60 million draw.

During Q3 2020, SkyWest received $144 million in payroll support funding, including $101 million in grants and $43 million in unsecured debt, under the previously announced Payroll Support Program Agreement (“PSP Agreement”) with Treasury. In aggregate, SkyWest received $450 million under the PSP Agreement in 2020, including $345 million in direct grants and $105 million in unsecured debt. SkyWest recognized $152 million and $190 million in payroll grant expense reductions in Q2 2020 and Q3 2020, respectively, and anticipates recognizing the remaining $3 millionin Q4 2020.

As of September 30, 2020, SkyWest had a $75 million line of credit facility. SkyWest had approximately $35 million of letters of credit issued under the facility and $40 million available under the line at quarter-end.

American Eagle-SkyWest aircraft photo gallery: