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Air France KLM SA (AFLYY)
:AFLYY
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Air France KLM
(OTC:AFLYY)
Rating:72Outperform
Price Target:
$1.50
▲(15.38%Upside)
Air France KLM (AFLYY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.39B
Dividend YieldN/A
Average Volume (3M)11.80K
Price to Earnings (P/E)6.5
Beta (1Y)0.72
Revenue Growth4.44%
EPS Growth-28.31%
CountryUS
Employees78,399
SectorIndustrials
Sector Strength89
IndustryAirlines, Airports & Air Services
Share Statistics
EPS (TTM)0.06
Shares Outstanding2,627,698,700
10 Day Avg. Volume0
30 Day Avg. Volume11,797
Financial Highlights & Ratios
PEG Ratio0.06
Price to Book (P/B)-1.49
Price to Sales (P/S)0.00
P/FCF Ratio12.57
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$1.00Price Target Upside-23.08% Downside
Rating ConsensusHold
Number of Analyst Covering0
Air France KLM Business Overview & Revenue Model
Company DescriptionAir France-KLM SA, together with its subsidiaries, provides passenger and cargo transportation services on scheduled flights in Metropolitan France, Benelux, rest of Europe, and internationally. The company operates through Network, Maintenance, Transavia, and Other segments. It also offers airframe and engine maintenance services; component support services comprising electronic, mechanical, pneumatic, hydraulic, etc.; and other services, as well as operates point-to-point flights to/from the Netherlands and France. As of December 31, 2021, it operated a fleet of 332 aircraft. The company was founded in 1919 and is headquartered in Paris, France.
How the Company Makes MoneyAir France-KLM generates revenue through multiple streams, primarily from passenger transportation, which constitutes the majority of its income. The company operates numerous flights across its extensive network of destinations, offering different ticket classes and services to cater to various customer segments. Additionally, cargo transportation is a significant revenue stream, leveraging the airline's global reach to transport goods. The group also earns income through its maintenance, repair, and overhaul (MRO) services, providing technical services to other airlines. Partnerships, such as those within the SkyTeam airline alliance, enhance connectivity and revenue opportunities through code-sharing agreements and joint ventures. Ancillary services, including baggage fees, seat selection, and in-flight sales, contribute additional income, while loyalty programs like Flying Blue encourage repeat business and customer retention.
Air France KLM Earnings Call Summary
Earnings Call Date:Apr 30, 2025
(Q1-2025)
| % Change Since: 52.94%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Positive
The earnings call reflects a generally positive outlook with strong revenue growth, improved operating results, and robust cash flow, despite challenges such as increased costs at Schiphol and softness in the US economy class market.Q1-2025 Updates
Positive Updates
Revenue Growth
Revenues were up 8% year-over-year, driven by a solid performance across all activities, including maintenance.
Improved Operating Results
Operating result improved by €161 million, reaching a negative €328 million. This was supported by strong unit revenue development, a more favorable fuel price environment, and improved operational performance.
Positive Free Cash Flow
Generated a positive recurring adjusted operating free cash flow of €0.8 billion, highlighting strong cash generation capabilities.
Premium Segment Performance
Strong performance in the premium segment, with notable demand in premium economy and business class, contributing to high yields.
Sustainability Commitment
The share of new generation aircraft increased by 7 percentage points compared to last year, now representing 28% of the total fleet.
Strong Engine Maintenance Business
Significant step-up in revenues from engine maintenance, approaching pre-COVID margins despite supply chain difficulties.
Negative Updates
Impact of Schiphol Tariff Increase
Schiphol tariffs increased by an outrageous 40%, impacting unit costs by approximately 0.3% to 0.4%.
Transavia Challenges
Transavia faced challenges due to the Easter holiday shift, bad weather in Spain, and new ticket taxes in the Netherlands, affecting unit revenue.
US Market Softness
Softness in economy class yields on the transatlantic market, with a need to potentially lower prices to stimulate demand.
Maintenance Cost Pressures
Higher maintenance costs expected to continue impacting unit costs, with one-off compensations from the previous year no longer applicable.
Company Guidance
During the Air France-KLM First Quarter 2025 Results Presentation, CEO Ben Smith and CFO Steven Zaat highlighted several key metrics demonstrating the group's improved performance. Revenues increased by 8% year-over-year, and the operating result improved by €161 million, resulting in a negative €328 million. The net debt-to-EBITDA ratio stood at 1.6 times, aligning with their midterm ambition range of 1.5 to 2.0 times. The group generated a positive recurring adjusted operating free cash flow of €0.8 billion, indicating strong cash generation capabilities. Additionally, the share of new generation aircraft in the fleet rose by 7 percentage points to 28%. Despite economic uncertainties, Europe maintained strength as a travel destination, with inbound traffic growth from the U.S. and other regions. The company remains committed to sustainability and premiumization, with a focus on upgrading long-haul premium offerings and expanding the new La Première suite, which has become profitable.Air France KLM Financial Statement Overview
Summary
Air France KLM's financial performance is on a recovery path with improving revenue and operational margins. However, high leverage and negative equity present significant financial risks. Cash flow improvements are promising, but the company needs to focus on sustainable profitability and balance sheet strengthening.Income Statement
Air France KLM's income statement shows a recovery trajectory with a positive revenue growth rate of approximately 19% from 2022 to 2023 and a further increase in 2024 and TTM. The gross profit margin in TTM is 18.15%, and the net profit margin is 1.71%, indicating moderate profitability. However, the EBIT margin of 5.17% and EBITDA margin of 14.40% suggest operational efficiency improvements. Challenges remain with maintaining consistent profitability due to industry volatility.72
Positive
Balance Sheet
Air France KLM's balance sheet reflects high leverage with a negative stockholders' equity of -$1.945 billion in TTM, indicating financial risk. The debt-to-equity ratio can't be calculated due to negative equity. The equity ratio remains negative, suggesting a reliance on debt financing. Despite these challenges, there has been improvement in reducing net debt over time.55
Neutral
Cash Flow
The cash flow statement shows a positive trend with an improvement in operating cash flow, reaching $4.632 billion in TTM. The free cash flow has turned positive, indicating better cash management. The operating cash flow to net income ratio is 8.46, showing strong cash generation relative to net income. However, the free cash flow growth rate from the previous year is substantial, highlighting potential volatility.68
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 31.97B | 31.46B | 30.02B | 26.39B | 14.31B | 11.09B |
| Gross Profit | 5.80B | 4.99B | 6.17B | 7.97B | 3.10B | 1.00M |
| EBITDA | 4.55B | 4.26B | 4.64B | 3.73B | -371.00M | -3.65B |
| Net Income | 547.00M | 317.00M | 934.00M | 728.00M | -3.27B | -7.03B |
Balance Sheet | ||||||
| Total Assets | 37.46B | 36.16B | 34.49B | 32.30B | 30.68B | 30.21B |
| Cash, Cash Equivalents and Short-Term Investments | 5.82B | 5.98B | 7.38B | 7.23B | 6.80B | 6.71B |
| Total Debt | 12.45B | 14.53B | 13.53B | 14.71B | 16.24B | 18.75B |
| Total Liabilities | 36.80B | 35.36B | 33.99B | 34.78B | 34.50B | 35.63B |
| Stockholders Equity | -1.95B | -1.76B | -2.05B | -3.00B | -3.82B | -5.43B |
Cash Flow | ||||||
| Free Cash Flow | 230.00M | -232.00M | -426.00M | 1.88B | -668.00M | -4.92B |
| Operating Cash Flow | 4.63B | 3.50B | 3.13B | 4.86B | 1.53B | -2.83B |
| Investing Cash Flow | -3.07B | -2.77B | -3.24B | -2.15B | -1.24B | -1.58B |
| Financing Cash Flow | -2.39B | -2.11B | -285.00M | -2.76B | -77.00M | 7.15B |
Air France KLM Technical Analysis
Positive
1.30
Price Trends
1.07
Positive
1.01
Positive
0.93
Positive
Market Momentum
0.08
Negative
74.85
Negative
99.43
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AFLYY, the sentiment is Positive. The current price of 1.3 is above the 20-day moving average (MA) of 1.16, above the 50-day MA of 1.07, and above the 200-day MA of 0.93, indicating a bullish trend. The MACD of 0.08 indicates Negative momentum. The RSI at 74.85 is Negative, neither overbought nor oversold. The STOCH value of 99.43 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AFLYY.
Air France KLM Peers Comparison
Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $29.86B | 9.24 | 27.70% | ― | 4.23% | 13.13% | |
79 Outperform | $36.75B | 8.17 | 30.07% | 1.24% | 3.01% | -0.90% | |
73 Outperform | $28.51B | 17.87 | 22.41% | 1.51% | 3.12% | -13.82% | |
72 Outperform | $3.39B | 6.55 | -7.21% | ― | 4.44% | -28.31% | |
67 Neutral | £2.87B | 10.55 | 4.69% | 4.42% | 2.40% | -24.48% | |
66 Neutral | $20.81B | 43.36 | 5.63% | 2.47% | 3.26% | 27.77% | |
64 Neutral | $8.25B | 14.44 | -21.27% | ― | 1.92% | 36.07% |
* Industrials Sector Average
Performance Comparison
AFLYY
Air France KLM
1.30
0.42
47.73%
DAL
Delta Air Lines
56.29
12.97
29.94%
RYAAY
Ryanair Holdings
56.15
18.24
48.11%
LUV
Southwest Airlines
36.51
9.48
35.07%
UAL
United Airlines Holdings
92.25
44.06
91.43%
AAL
American Airlines
12.51
1.82
17.03%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.