Air France-KLM posts H1 loss on recession woes

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COST-CUTS HELPING

The company posted a current operating loss of 543 million euros for the six months ended in September, compared with a current operating profit of 592 million euros for the same period a year earlier. First-half revenues declined 19.9% to 10.775 billion euros.

The group recorded a 147 million euro net loss for the second quarter, compared with a 27 million euro net profit in the same period a year earlier.

Cost-cutting measures are starting to have a positive impact on results, Gourgeon said.

The airline said it is targeting cargo-activity break-even

in 2011-12. In the second quarter, cargo activity revenues slumped 41%to 540 million euros.

A reorganization of its medium-haul network announced earlier this month and linked to its wider "Challenge 12" cost-cut plan should translate into a positive impact on operating results in 2011-12, Air France-KLM said.

British Airways Plc earlier this month posted a bigger than expected first-half loss and predicted revenue would slump by 1 billion pounds this year.

Germany's Deutsche Lufthansa AG last month provided a gloomy outlook for the airline industry and reported that its third quarter operating profit fell 21%.

Airline association IATA has said it expects the industry as a whole to lose USD 11 billion this year, and USD 3.8 billion in 2010.