Solid Operational Outlook for Air France-KLM; No Update on EUR 4 Billion Recapitalization Progress

Despite the first quarter of the year being negatively affected by the omicron variant, war in Ukraine, rising fuel costs and strict Chinese lockdowns--Air France-KLM managed to exceed expectations and reported positive EBITDA of EUR 221 million. Free cash flow of EUR 630 million in the first quarter has now been positive for four quarters in a row and is largely driven by the return of advanced ticket sales as the booking window lengthens. Seat capacity was at 75% of 2019 levels in the first quarter, reaching 80% of precoronavirus levels by March. The outlook is positive--network capacity is expected to reach up to 90% of 2019 levels by summer while yields are tracking ahead of pre-COVID-19 levels due to high pent-up demand and low industry capacity. Operating profits are expected to reach break-even in the second quarter and be “significantly positive” in the third quarter.