Air France-KLM yields remain down year-on-year; Aegean Airlines hit by ATM strike

European markets recovered on Monday (08-Feb-2010), ending their three day slump, pushed higher by defensive stocks and commodities.

In major markets, UK’s FTSE (+0.6%), France’s CAC (+1.3%) and Germany’s DAX (+1.2%) were all up at the end of trading.

However, the majority of European carriers were down, pushed lower by an improvement in oil prices (+2.7%), to USD71.19.

Air France-KLM RASK remains down year-on-year

Air France (-1.6%) fell after reporting that unit revenue per available seat kilometre (RASK) remained below last year’s level in Jan-2010, despite an improvement in the long-haul segment.

The carrier reported a 1.4 ppt year-on-year improvement in load factor for the month, to 78%, boosted by a 3.5 ppt increase in trans-Atlantic load factor, to 83.8%. Europe (+1.8 ppt), Asia Pacific (+1.0 ppt) and Africa/Middle East (+0.2 ppt) loads also improved slightly, while Caribbean/Indian Ocean load factor was down 3.0 ppts for the period. The overall increase in load factor was the result of a larger reduction in capacity (ASKs) than fall in traffic (RPKs), down 3.4% and 1.6%, respectively.

Passenger numbers meanwhile fell 3.2%, to 5.1 million for Jan-2010, with Asia Pacific the only region to rise for the month, up 1.0%. Europe (-4.4%), trans-Atlantic (-0.5%), Africa-Middle East (-2.2%) and Caribbean/Indian Ocean (-3.3%) passenger numbers were all down.

Air France-KLM stated activity levels were affected by the adverse weather conditions, as well as two days of strikes by French air traffic controllers. Year-on-year changes benefit from a favourable comparison base, with the exception of the Americas and Africa and Middle East networks which recorded rises in both traffic and capacity in Jan-2009.  

Meanwhile, Air France KLM’s cargo performance for Jan-2010 was a different story, with the carrier stating revenue per available ton kilometre (RATK) continued to improve during the month, recording a slight rise year-on-year. Cargo traffic (FTKs) were up 2.0% year-on-year, as capacity (ATKs) was reduced 11.4%, resulting in a 8.5% improvement in freight load factor, to 64.3%.

IATA stated during trading that European carriers, such as Air France-KLM and British Airways, are likely to lag behind Asian carriers in raising fares, with the majority of European carriers expecting no improvement in yields this year. See related article: Airlines see improved yields ahead, but risks remain – IATA survey

British Airways long-term credit rating downgraded

British Airways’ (-3.4%) shares also took a hit, after Standard & Poor’s lowered its rating of the carrier’s long-term corporate credit rating from ‘BB’ to ‘BB-‘, with a negative outlook. The analysts cited the possibility of strike action from its cabin crew, the carrier’s earnings outlook and “uncertainty” surrounding its pension deficit. The reduction is the ratings third in less than 12 months.

Aegean Airlines named largest regional carrier in Europe, faces strike

Aegean Airlines (+2.9%) has cancelled all services across its network for 10-Feb-2010 and several flights on 09-Feb-2010 as a result of the 24-hour strike of air traffic control personnel in Greece on 10-Feb-2010.

European Regions Airline Association (ERA) reported Aegean was the largest regional airline in Europe in Sep-2009, with a 12.8% year-on-year increase in passenger numbers for the month, to 580,300.

Aer Lingus load factor up for Jan-2010

Aer Lingus (+0.8%) was also up, after reporting a 3.1 ppt improvement in load factor for Jan-2010, to 67.4%, as both short- and long-haul loads increased over the month. However, passenger numbers were up only 0.6% year-on-year, to 665,000, as long-haul passenger numbers tumbled 23.0% to 57,000. Short-haul passenger numbers were up 3.6%, to 608,000.

Europe selected airlines daily share price movements (% change): 08-Feb-2010