Air France sees biggest loss in over a decade

AIR FRANCE-KLM posted its largest loss in 15 years after the airline yesterday reported a full-year net loss of €1.56bn (£1.33bn).

Chief executive Pierre-Henri Gourgeon dubbed the year “annus horribilis” after the airline suffered a number of set backs, including the Brazil crash last June which resulted in the death of 228 passengers, the disruptions caused by Iceland’s volcano as well as a fall in air traffic, particularly in cargo.

This year’s loss is almost double the €811m loss reported for the previous financial year.

Air France said it will not pay a dividend because of the losses, which came after it paid out €637m in fuel costs and suffered from the biting effect of the recession.

Gourgeon said: “The global economic crisis had a profound effect on the entire airline industry.”

He added: “We are therefore maintaining our objective of operating break-even for the current financial year excluding the impact of pre-2009 fuel hedges, and subject to the definitive cost of the closure of European airspace.”

Revenue fell by 15 per cent to €20.9bn, while passenger traffic also declined 3.2 per cent.