Air France-KLM (AF) Q4 2024 earnings summary

Executive summary

• Achieved record Q4 2024 results, with revenue up 6.4% year-over-year to €7.9bn and full-year revenue up 4.8% to €31.5bn, driven by premium and ancillary revenue growth and strong Transavia and maintenance performance.

• Operating result reached €1.6bn for FY 2024, with a 5.1% margin, reversing last year's loss and supported by robust premium demand and lower fuel prices.

• Premium segment revenue grew 12%, ancillary revenue up 24%, and online direct sales up 11% year-over-year.

• Sustainability progress included a major SAF agreement with TotalEnergies, 27% of the fleet now next-generation aircraft, and improved ESG ratings.

• CEO highlighted resilience amid operational and external challenges, fleet renewal, and strategic partnerships, including a minority stake in SAS.

Financial highlights

• Q4 operating margin at 5.0–5.8%, a significant improvement year-over-year, supported by lower fuel prices and higher unit revenue.

• FY2024 operating margin at 5.1%; recurring adjusted free cash flow positive at €0.3bn for the year.

• Net debt/EBITDA ratio at 1.7x, within the 1.5–2.0 target range; cash at hand at year-end €9.4bn.

• Premium cabins contributed 26.9% of group revenue, up over one percentage point year-over-year.

• Cargo and maintenance segments delivered double-digit revenue growth in Q4.

Outlook and guidance

• 2025 group capacity to grow 4–5%, with Transavia expected to grow 10%.

• Low single-digit unit cost increase guided for 2025; net capex expected at €3.2–3.4bn, mainly for fleet renewal.

• Targeting at least €300m EBIT improvement in 2025, with medium-term ambition of 8%+ operating margin by 2026–2028.

• Net debt/EBITDA guidance maintained at 1.5–2.0x.

• KLM's 'Back on Track' program aims for €450m EBIT improvement and >8% EBIT margin by 2026–2028.