The factors in favour of a rise in the Air France-KLM share price:
The first thing that can be stressed about the Air France-KLM group is of course its positioning in the air transport market. Indeed, the French company is one of the leaders in this sector of activity and currently has the largest air network between Europe and the rest of the world. Air France-KLM is also the leader in passenger transport in Europe, with inter-European travel accounting for more than ¾ of the carrier's business. Finally, Air France-KLM is also the international leader in freight transport and aircraft maintenance.
If Air France-KLM has been able to position itself profitably on the world market, it is notably thanks to the SkyTeam alliance that it manages and which currently represents more than 20% of the international market share. The partnership with the Indian company Jet Airways and the joint venture that the group has set up with Delta Airlines for the North Atlantic market is also to be welcomed, with a collaboration contract signed until 2019. This strong presence outside the European market alone is reassuring for investors.
The Air France-KLM group also stands out from its competitors by offering a remarkable range of connections thanks to the connecting platform known as the double intercontinental hub, which combines the hubs at Roissy-Charles-de-Gaulle and Amsterdam-Schipol airports.
Recently, it has been noted that Air France-KLM has multiplied its investments in the high-end travel sector, which represents an important challenge for this sector of activity and promises interesting results. At the same time, the group has also been able to position itself in the low-cost sector with its low-cost subsidiary Transavia created in 2007 and which has been generating profits since 2012. This has notably enabled a major restructuring of the group's point-to-point network.
Recently, Air France-KLM has also become more profitable thanks to its maintenance services. The group has become the second largest in this sector on an international scale.
Like all air transport companies, Air France-KLM has also benefited for some time from the fall in crude oil prices, which has enabled it to make significant savings on its paraffin purchases. As these expenses represent more than 35% of operating expenses, this offers good prospects.
Finally, the company's efforts to reduce its level of indebtedness can also be highlighted, with a significant drop in debt since 2015.