together O P E N & C O M M I T T E D 2010-11 www.airfranceklm.com Annual Report 2010-11 Annual report Rapport annuel AFKL • VC11/05 • SPP • 220 x 280 mm • Visuel : BUREAU UK • Parution le : 27/mai/2011 • Remise le : 27/mai/2011 CTR • BAT The captain and his crew wish you an enjoyable business trip to New York, Tokyo, Delhi… and more than 850 other cities, letting you take advantage of one of the world’s leading networks with our SkyTeam partners. airfrance.com making the sky the best place on earth II _ Air France-KLM 2010-11 Annual Report AIRF_1105008_BUREAU_Rapport annuel AFKL_UK_220x280.indd 1 26/05/11 14:18 E d i t o r i a l We can face the challenges with confidence Jean-Cyril Spinetta, Chairman of the Air France-KLM Board of Directors On the North Atlantic, the leading long-haul market globally, Air France-KLM has established a significant lead over the other alliances, and particularly Star Alliance, through the joint-venture that the Group has created with Delta and Alitalia. Our goal is to extend this model to all our SkyTeam partners, and particularly our Chinese partners. Furthermore, we are actively engaged in membership negotiations with other airlines in Brazil, India and elsewhere in Asia. On this basis, SkyTeam stands to benefit from global coverage. “Air France-KLM has established an effective business model that has been After a challenging time in 2009-10, our Group has widely replicated.” succeeded in stemming the haemorrhage and returning to profit while also reducing debt. Our recovery has been SkyTeam will be the alliance benchmark. My initial thinking remarkable. This success is thanks to the outstanding work had been that global transportation would be structured of the Air France-KLM teams and the resolute commitment around three major global systems: SkyTeam, Star Alliance of all our employees within a difficult environment. I would and One World. Today this is a reality. We now have to be like to thank everyone for their efforts. sure to maintain our position and our role within SkyTeam. To confirm this recovery, the Air France-KLM group was The agreement with Alitalia implemented in 2009 further able to implement the strategy required to win back market reinforces the Group’s presence on the large Single European share lost during the crisis in both the passenger and cargo Sky market and makes Air France-KLM the unrivalled leader businesses. But make no mistake: we are still in an uncertain on all long-haul routes between Europe and the rest air transport environment. There remain numerous obstacles of the world. to overcome to ensure that our Group remains in a leading Looking ahead, we need to further improve the efficiency position. I am thinking, in particular, of the oil price, and of the Air France-KLM group. Seven years after the merger, competition from low cost carriers and the Gulf State airlines. we must ensure that we are constantly reinforcing the We are, however, on the right track. The Air France-KLM Group’s cohesion and the relevance of its strategic choices. group has established an effective business model that its I have no doubt that the remarkable mobilization of all main European competitors have been swift to replicate. Air France-KLM employees during the difficult period we The SkyTeam alliance, which is the most advanced in terms have just experienced has left us well equipped to face of operating principles, has been considerably reinforced. the challenges ahead with increased confidence. Air France-KLM 2010-11 Annual Report _ 1 AIr FrAnce-KLM, A responsIbLe, gLobAL LeAder Air France-KLM is a global leader in each of its three businesses: passenger transportation, cargo transportation and aeronautics maintenance. Thanks to its dual hub of Paris-Charles de Gaulle and Amsterdam-Schiphol, the Group operates a balanced network offering the most connecting opportunites between Europe and the rest of the world. It has operations in all continents and offers 254 destinations in 124 countries. Born of the merger between Air France and KLM, the Group is the European leader in passenger transportation and ranks amongst the leading generalist companies in cargo transportation. In the aeronautics maintenance market, Air France-KLM is the world number two of the multi-product players. The Group has more than 100,000 employees. With Delta and Alitalia, the Group operates the largest trans-Atlantic joint-venture. Air France and KLM are also members of the SkyTeam global alliance, bringing together 14 airlines. Air France-KLM is recognized as the sustainable development leader in the air transport sector and has been a Dow Jones Sustainability Index component for the past six years. 2 _ Air France-KLM 2010-11 Annual Report C o n t E n t s 2010-11 P.8 P.21 P.49 IntervIew wIth deveLopMent pIerre-henrI peopLe Aberdeen Glasgow Edimbourg AALBORG Newcastle Copenhague Leeds Durham Liverpool Humberside Dublin Manchester BILLUND Birmingham Norwich Hambourg Berlin London City Brême Hanovre Portraits of air France-KlM staff Cardiff Bristol AMSTERDAM Leipzig gourgeon, Londres Dusseldorf Cologne Francfort Prague Bruxelles Stuttgart Nuremberg Brest Strasbourg PARIS Munich Vienne Mulhouse Nantes Genève Zurich Clermont-Ferrand Bern Ljubljana Annecy Milan Bordeaux Lyon Vérone Zagreb Turin Venise Oviedo Montpellier Gênes Biarritz Toulouse Marseille Bologne Nice Vigo Bilbao Pise Florence Pau Perpignan Toulon Bastia Calvi Ajaccio Rome Barcelone Figari Madrid Naples Trondheim Lisbonne Oslo Bergen Helsinki Chief Executive officer ofa ir France- Sandefjord St. Petersbourg Stavanger Stockholm Kristiansand Linköping Göteborg Moscou Vancouver Calgary Varsovie Ottawa Seattle Montréal AMSTERDAM Kiev Portland Minneapolis Toronto Budapest KlM on the outlook for the Group PARIS Boston Bucarest Chicago Detroit Belgrade Salt Lake City New York Sofia Pittsburg San Francisco Philadelphie Cincinnati Washington Istanbul Pékin Memphis Erevan Los Angeles Athènes Almaty Seoul Dallas Atlanta Tokyo Houston Rabat Beyrouth Teheran Alger Tunis Damas Casablanca Tel Aviv Osaka Shanghai and the Embark corporate project ORLANDO Koweït City Delhi Chengdu Tripoli MIAMI Le Caire Amman Dammam Hangzhou Bahreïn Taipei Saint PUNTA CANA Riyad Canton Dubaï Domingue FREETOWN Doha CANCUN Saint-Martin Mascate Djeddah Abu Dhabi Hanoi Hong Kong Pointe-à-Pitre Nouakchott Bombay XIAMEN Aruba MONROVIA Fort-de-France LA HAVANECaracas Dakar Bamako Niamey Mexico City Bonaire Khartoum Paramaribo Ouagadougou N'Djamena Djibouti Bangalore Bangkok Manille Panama City Curaçao Conakry • three questions for Peter Hartman, Cayenne Abuja Bogota Kano Ho Chi Minh Ville Accra Bangui Addis Abeba PHNOM PENH Quito Kuala Lumpur Guayaquil Abidjan Entebbe Lagos Port Harcourt Nairobi Singapour Douala Cotonou Kigali Kilimanjaro Lomé Yaounde Djakarta Malabo Libreville Dar es Salaam Denpasar President and CEo of KlM LIMA Brazzaville Pointe Noire Maurice Papeete Kinshasa Rio de Janeiro Luanda Antananarivo La Réunion São Paulo Nouméa Johannesbourg BUENOS AIRES LE CAP Santiago du Chili P.13 Consolidating our leadership position • a look at the Group’s main growth areas • Map custoMers of the network P.39 operAtIons reinforcing our service culture P.59 FInAnce P.18, 46, 56 hIghLIghts teams mobilized 24/7 a review of the results for the year • Governance • Consolidated Key figures and highlights financial statements of the passenger, cargo and maintenance businesses Air France-KLM 2010-11 Annual Report _ 3 Key figures for the 2010-11 financial year (to March 31, 2011) Revenues billion euros operating income 23.6122 million euros Breakdown of passenger revenues by geographical region % Europe (including France)30 Asia 16% 20% Africa-Middle East Americas 27% 7 % Caribbean and Indian Ocean 71.3million passengers 254 destinations 2 hubs paris-cdg and 124 countries Amsterdam-schiphol 4 _ Air France-KLM 2010-11 Annual Report n E w s Breakdown of revenues by business (in € billion) 1 Passenger Maintenance 18.1 Cargo 3.2 Other activities* 1.3 * Regrouping the leisure (Transavia.com) and catering businesses 590 aircraft in operation 168 227 181 14 long-haul medium-haul regional full aircraft aircraft aircraft freighters Air France-KLM 2010-11 Annual Report _ 5 a look back at the 2010-11 financial year APRIL 2010 SEPTEMBER 2010 voLcAnIc eruptIon In IceLAnd AIr FrAnce’s new busIness oFFer The eruption of the Icelandic volcano Air France upgrades its Business offer or sleeping. A choice of menus and new Eyjafjöll leads to the almost total shutdown by introducing a more comfortable and services throughout the travel experience of operations. Something not seen more practical seat for working, relaxing also enhance this offer. in Europe since the Second World War. JuLy 2010 hIstorIc contrAct For MAIntenAnce Air Canada entrusts the Group with the engine support on the GE90 powerplants equipping its B777s. In terms of revenue, this contract is one of the largest in the history of maintenance. SEPTEMBER 2010 AuGuST 2010 AIr FrAnce-KLM, A responsIbLe LeAder sixth successive year, the Group is servAIr opens operAtIons Air France-KLM is confirmed air included in the benchmark financial index, In KenyA transport leader for sustainability. For the the Dow Jones Sustainability Index. Servair, the Air France subsidiary specialized in airline catering and airport services, now offers its services in Kenya at the Nairobi and Mombasa outstations NOvEMBER 2010 thanks to the acquisition of the company NAS Catering. Servair is leader in the FIrst AIr FrAnce-KLM African continent with 17 sites. strAtegIc pLAn Embark, the Group’s strategic project is presented to employees. This first corporate project common to Air France and KLM unveils the Group’s goals for the coming years: return to growth and be a leader in the globalized airline sector. The project is structured around three key values: together, open and committed. 6 _ Air France-KLM 2010-11 Annual Report DECEMBER 2010 FEBRuARy 2011 the AIr FrAnce FoundAtIon growth For sKyteAM MobILIzes In senegAL With the arrival of Middle East Airlines, The Air France Foundation jointly the SkyTeam alliance will have finances a brand-new emergency 20 members by 2012.