Dutch Airline KLM Posts $62M Net Loss
AMSTERDAM, Netherlands (AP) _ Dutch airline KLM posted a net loss of $62 million (euro54 million) for its first financial quarter Thursday, citing a weak global economy, the war in Iraq and SARS.
KLM said sales fell 16 percent to $1.63 billion in its first quarter ending June 30 and that it expects to post a net loss for the current year.
The company had profits of $12.6 million in the first quarter of 2002.
However, KLM said traffic has picked up in Asia with the threat of severe acute respiratory syndrome, or SARS, fading. It expects to make an operating profit this year, due largely to cost cuts.
KLM has reduced the size of its fleet and has begun cutting 4,500 jobs.
The outlook for business remains ``fragile,″ Chief Financial Officer Rob Ruiter said in a conference call.
KLM’s loss was smaller than analysts had expected and the company’s shares rose 1.8 percent in trading on the Euronext Amsterdam stock market.
KLM repeated earlier statements it plans to enter a strategic alliance with either Air France or British Airways in the coming months, adding that talks with Air France are more advanced.
Petercam analyst Thijs Berkelder said investors should sell their shares.
``Under the current economic environment, it will remain hard, if not impossible, for KLM to come back into profit,″ he said.