Air France February 2003 Traffic

Operations in February 2003 were affected by the economic slowdown, geostrategic uncertainties and companies implementing policies to limit their staff travel budget . They were further disrupted by the two pilot strikes, even though participation was low, and by bad weather conditions in the United States. Despite these difficulties, traffic progressed by 2% for an increase in capacity of 3.4%. The load factor stood at 75.1% (down 1 point). The various disruptions of the past few month will represent a loss of xx million euros in operating income.

Over the first eleven months of the financial year, traffic progressed by 3.3% for a 2.5% rise in capacity, giving rise to a 0.6 point increase in the load factor to 76.2%.

The long-haul network posted an increase in traffic of 3.8% for a 5.3% rise in capacity. The load factor stood at 79.9% (down 1.2 points).

> On North American routes, traffic grew by 12.5% for a 13.9% increase in capacity. The load factor dropped slightly to 75% (down 0.9 points).
> In the Latin American sector, the load factor rose sharply to 84.9% (up 3.5 points). Traffic decreased by 2.1% for a 6.2% drop in capacity.
> On the Asian network, the international context impacted traffic, which dropped by 6% for stable capacity (up 0.2%). The load factor dropped by 5.3 points but remained at the very high level of 80.2%.
> The Africa/Middle east network was also affected by regional and international political events, with a drop in capacity and traffic of 1% and 7.6% respectively. The load factor stood at 71.4% (down 5.1 points).
> On the Caribbean/Indian Ocean network, traffic rose by 13.7% for a 10.3% increase in capacity. The load factor rose by 2.6 points to 86.6%.

On the international medium-haul network, the situation remains difficult. The Group posted a drop in traffic of 8.7% for a 1.3% decrease in capacity. The load factor stood at 59.3% (down 4.3 points).


On the domestic network, the situation continues to improve, with traffic progressing by 2.3% for a 2% drop in capacity, with the load factor increasing by 2.8 points to 63.1%.
Traffic remained stable (up 0.1%), despite a 2.2% decrease in capacity, and the load factor gained 1.5 points to reach 67.8%.

Over the first eleven months, the load factor stood at 64.7%, capacity increased by 5.7% and traffic by 6.4%.

The risk of war in the Middle East has had a negative impact on bookings over the next few months. This is why Air France has opted for a summer 2003 schedule reflecting moderate growth, with an overall increase in capacity of 1.8%.

> On the long-haul network, capacity will increase by 1.8% on average, with a peak of 2.6% during the high season from mid June to mid September. The highest growth is on the Asian network (up 11%) thanks to additional flights to China and the launch of services to Canton planned for September 2003. On the North American network, the major new innovation is the 3rd daily service to Montreal. In Latin America, capacity will be reduced by 3% with the use of smaller aircraft. On the African network, capacity will be adjusted to demand with the introduction of the Airbus A330, with a 20% drop in capacity. On the Caribbean/Indian Ocean network, there will be additional flights to certain destinations following the suspension of Air Lib`s operations.
> On the medium-haul network, capacity will be adapted on the shortest routes with fewer frequencies (Amsterdam, Düsseldorf, Frankfurt, Munich) and some intra-regional routes will be suspended. However, to Southern Europe and the Mediterranean, there will be additional services to Malaga, Bilbao, Valencia, Verona, Athens and Casablanca. A 2nd daily flight to Saint Petersburg improves services to Russia.
> On domestic routes, the changes made to the schedule in winter 2002-2003 will be continued this summer. Additional capacity has been introduced following the suspension of Air Lib`s operations, thereby maintaining capacity expressed in ASK at the same level from one summer to the next.

Given the rising price of fuel, Air France has decided, as have other European airlines, to increase fares of tickets sold in France by 3% as from 6 March 2003.