Air France plunges, Turkish Airlines gains on improved traffic data

European markets were down slightly on Thursday (11-Feb-2010), after the European Council stated it would assist Greece with its debt issues, but declined to outline its plans, with banking stocks declining as a result. Consequently, European airline shares were mainly down at the end of trading.

In major markets, UK’s FTSE (+0.1%) gained only slightly, while France’s CAC (-0.3%) and Germany’s DAX (-0.9%) slipped.

Air France-KLM expecting losses again in 4Q2009-10

Air France-KLM (-11.2%) plunged after warning of further losses for 4Q2009-10. The carrier expects to post another loss of approximately EUR500 million for the three months ended 31-Mar-2010, after reporting a bigger than expected loss of EUR245 million in 3Q2009-10.

The carrier aims to break even FY2010-11, as a result of "measures to reduce costs, the anticipated slight progression in unit revenues, the launch of the new medium-haul product and the restructuring of the cargo business already under way". See related report: Singapore Airlines leads the way in slashing labour costs. SAS still worst in class. Air France-KLM has more work to do

Stocks of other large European carriers, including Lufthansa (-3.8%) and Iberia (-3.2%) dropped as a result, on investor concerns the demand environment remains soft.

Norwegian returns to profitability

Norwegian Airlines (+13.9%) was the day's biggest gainer, after the carrier reported an 8.4% increase in 4Q2009 revenue and a return to profitability on the EBITDAR, EBITDA, EBIT, EBT and net levels. See related report: LCCs account for 22% of global capacity in Feb-2010; Norwegian Air Shuttle returns to profitability

Turkish Airlines gains on improved traffic data

Turkish Airlines (+2.0%) rose after the carrier reported a 3.2 ppt year-on-year rise in load factor for Jan-2010, to 65.3%, after traffic (RPKs) increased 35.6% on a 29.2% increase in capacity (ASKs). Revenue passengers were also up 26%, to 1.6 million.

Thomas Cook Group

Thomas Cook Group (+0.6%) was also up slightly, as the group announced a narrower loss for the three months ended 31-Dec-2009. The company reported a loss before tax of GBP81.5 million, compared to a loss of GBP112 million in the previous corresponding period.

Thomas Cook stated it expects the Winter season trading to trend towards reduced capacity levels. However, with full year results underpinned by a strong Summer programme, weighted towards higher margin destinations, and cost reduction plans, it is confident the Group will perform in line with Board expectations.

More news can be found in today’s Europe Airline Daily, an efficient morning briefing on European airline developments.

Europe selected airlines daily share price movements (% change): 11-Feb-2010