Air France-KLM shares slashed on earnings outlook - European airline shares wrap
Air France-KLM shares slumped 7.8% on Friday as the carrier gave an opaque assessment about its 2010 earnings outlook. For the current financial year (ending 31-Mar-09), the airline is expected to be in the red to the tune of EUR200 million at the operating level. As recently as mid-Feb-2009, the carrier was still predicting a profit for the current financial year.
The outlook for the 2010 financial year is not much better, with further losses expected. Air France-KLM CEO, Pierre-Henri Gourgeon, stated, "2009/10 will begin in a context of unprecedented difficulty, with little visibility on how the economy will evolve and on the volatility of factors such as currencies and the oil price".
Investors have been concerned with the lack of visibility about the carrier's earnings outlook and its stock price has fallen 28% so far this year. Air France-KLM's woes had an impact on British Airways and Lufthansa, whose share prices fell 3.1% and 2.4% on Friday, respectively.
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European selected airlines daily share price movements (% change): 27-Mar-09