Air France First Half Results

Pre-tax income for second quarter up 28% to 113 million euros despite pilots` strike
First half results:
- Turnover: 6.55 billion euros (down 0.5%) - Operating income before aircraft disposals: 293million euros (up 8.1%) - Net pre-tax income: 275 million (down 5.8 %) Fiscal year 2002-03: target of higher operating income than last year maintained.
Air France`s Board of Directors met on 18 November 2002 under the chairmanship of
Jean-Cyril Spinetta, to finalize the accounts for the half-year ending 30 September 2002.

During the meeting, the Chairman made the following comments: ” The air transport industry has continued to suffer from the economic crisis accentuated by the attacks of September 2001. Despite this, our international traffic has substantially increased, enabling our long and medium haul networks to compensate for the weak French domestic market. Our results are still largely positive for this first half-year, despite the pilot`s strike whose impact has been estimated at 55 million euros. For the current financial year, Air France should post improved operating income before aircraft disposals, market conditions permitting. This will therefore be the 6th consecutive year that Air France has recorded positive results.
Furthermore, we are very satisfied to have reached an agreement with our pilots, which will enable us to stabilize labour relations for several years and improve operational efficiency, whilst at the same time giving our flight deck crew the means to participate in the Company`s expansion. “

Results at 30 September 2002:

During the second quarter, traffic rose by 1.1% for a 1.8% increase in capacity and a load factor of 78% (down 0.6 points). Group unit revenue per available seat-km (RASK) grew 1.1% excluding currency (2.8%) and network mix (0.6%) effects. If we factor these out, group yield improved by 1.9%.

Turnover increased by 0.9% to 3.23 billion euros after loss in revenue estimated at 80 million due to the pilots` strike.


The EBITDAR stood at 525 million euros (up 21.5%). Operating income before aircraft disposals, and after the negative impact of the pilots` strike estimated at 55 million euros, rose to 141 million compared with 76 million the previous year and to 146 million after capital gains of 5 million euros from sales.

Group unit costs per EASK dropped by 2.8%. If you factor out currency (2.9%) and fuel price (1.8%) effects, they only went up 1.8%. The impact of the pilots` strike accounts for a 1.3% increase in unit costs.

Net pre-tax income rose to 113 million euros (up 28.4%). The tax charge for the 2nd quarter stood at 57 million euros against no charge for the same year-earlier period. This charge primarily corresponds to the use of the deferred tax credit which existed on 31 March 2002. The Group net income therefore came to 57 million euros.

Half-year net pre-tax income: 275 million euros (down 5.8%)

Over this half-year, Group traffic dropped by 1.2% for a 0.4% increase in capacity. The load factor fell 1.3 points to 77.3%.

Group unit revenue per available seat-km (RASK) remained stable (down 0.2%) and increased by 0.7% after adjusting for currency (1.5%) and network mix (0.7%) effects. However, after factoring out these effects, Group yield (RRPK) rose by 2.3%.