Air France-KLM Group revised its earnings outlook for this year for a third time as sales on long-haul routes remain weak and the full cost of a pilot strike that crippled flights for two weeks in September becomes apparent.
Earnings before interest, tax, depreciation and amortization for fiscal 2014 will be 200 million euros ($246 million) lower than previously estimated, the Paris-based airline said in a statement today.
The carrier had cut its earnings twice already this year, first in July amid overcapacity on North American and Asian routes and then in October when it said profit could be 500 million euros lower than previously predicted amid lost revenue from the worst strike in its history.
Several reasons, including “persistent weakness in unit revenues in several long-haul markets” and higher-than-expected so-called re-invoicing charges for passenger using other airlines during the strike, were among the factors behind the revision, the airline said.
“By significantly stepping up our cost-cutting efforts and adapting the investment plan, Air France-KLM can gain the resources and be well prepared to tackle 2015 despite the difficult competitive environment,” Chief Executive Officer Alexandre de Juniac said in the statement.
In July, Air France predicted earnings before interest, tax, depreciation and amortization at 2.2 billion euros to 2.3 billion euros this year, compared with a previous target of as much as 2.5 billion euros.
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