- Air France says its revenue slid by a massive 70% in August.
- The air carrier's daily cash burn still stands at £9.12 million.
- Air France recently entered into a new transatlantic joint venture.
CEO Anne Rigail of Air France (EPA: AF) told Corriere della Sera (Italian newspaper) on Wednesday that the air carrier saw a massive 70% decline in revenue last month. Owing to the Coronavirus pandemic that is still weighing on passenger numbers, its intercontinental routes could only fill close to 30% of the seats in August.
Its parent organisation, Air France-KLM, was reported about 1.5% down in premarket trading on Wednesday. But the stock jumped more than 3% on market open. At a per-share price of £2.66, shares of the company are currently at an all-time low. Air France-KLM was trading at £9.34 per share at the start of the year.
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In comparison, its performance was slightly upbeat in the stock market last year with an annual gain of roughly 10%. At the time of writing, the Franco-Dutch airline holding company has a market capitalisation of £1.14 billion.
Air France’s daily cash burn stands at £9.12 million
Rigail also highlighted on Wednesday that the airline’s daily cash burn still stood at an alarming £9.12 million. But the CEO expressed confidence that Air France was committed to exploring ways to minimise its losses.
Air France entered into a new transatlantic joint venture recently with Virgin Atlantic and Delta Air Lines. Rigail also implored Italy’s Alitalia to join the partnership at least as a 2nd level member. Alitalia, as per an announcement in June, is scheduled to be nationalised and launched as a public company later this year.
According to CEO Rigail:
“Alitalia is a long-standing partner, and we will propose to them to joint he joint venture as an associate member. I want to maintain a strong relationship with them.”
Rigail says there are no plans of investing in Alitalia
Rigail however, confirmed on Wednesday that there were no plans of investing in the largest Italian air carrier. In her statement in late June, the CEO had announced plans of laying off 6,500 workers in the next two years to cushion the economic blow from the Coronavirus pandemic.
CEO Ben Smith of the parent organisation, Air France-KLM, also said last week that £9.11 billion bailout package from French and Dutch governments was insufficient and won’t support beleaguered carriers for more than a year. Air France-KLM is currently struggling with new green taxes in addition to the virus-related challenges.