AIR FRANCE-KLM ADS - AFLYY STOCK NEWS

Air France-KLM reported a second-quarter 2024 operating result of €513 million, with a 6.5% operating margin. The group capacity increased by 4.1% year-over-year and the load factor remained stable at 88%. Group revenues rose by 4.3% to €7.9 billion. However, the operating result decreased by €220 million compared to last year, primarily due to rising unit costs and higher fuel prices. The net income was €165 million, down from €612 million in Q2 2023. Despite challenges, the company maintained positive cash flow at €134 million and reported cash at hand of €9.6 billion.

The Group experienced certain impacts due to the Olympic Games and rising fuel and salary costs. For the full year 2024, the unit cost is expected to rise by 2%. The net debt/EBITDA ratio increased to 1.6x. Key measures include a hiring freeze and additional cost cuts to navigate the challenging environment.

Air France-KLM and Air France have successfully renegotiated their Sustainability Linked Revolving Credit Facility, increasing it to €1.4 billion and extending its maturity to July 2028. Key improvements include:

• Maturity extended to July 2028 with a one-year extension option
• Increase from €1,290m to €1,405m
• Expanded lenders' pool from 16 to 17 banks
• Optimized financial conditions

This undrawn facility enhances the Group's liquidity management. KLM's separate €1.0 billion ESG-linked facility remains unchanged. The total Group Revolving Credit Facilities now amount to €2.4 billion, up from €2.3 billion previously, demonstrating strong confidence in the Group's financial stability.

Air France-KLM announced that the European Commission has reaffirmed the compliance of liquidity support measures provided during the Covid-19 crisis with EU State aid rules. These measures, which included State guaranteed loans and State loans from the French and Dutch governments, were fully repaid by June 2022 and April 2023, respectively. This decision does not affect the ongoing appeals in the Court of Justice of the European Union regarding previous judgments by the General Court of the EU, which annulled the initial decisions due to an incorrect determination of the aid beneficiary.

The press release provides an update on the total number of voting rights and shares for the company as of June 30, 2024, in accordance with French market regulations.

As of this date, the company reported having 262,769,869 shares outstanding.

The total number of theoretical voting rights, which include double voting rights, amounted to 360,723,054.

Air France-KLM and Transavia France are facing pressure on projected unit revenues for the summer season due to the upcoming Olympic Games in Paris. Traffic to and from Paris is lagging behind other European cities, with international markets avoiding the city and residents postponing their holidays. This has led to an estimated negative impact on unit revenues of €160m - €180m for June-August 2024. Despite this, the company has not adjusted its guided capacity. Demand is expected to normalize after the Olympics, with encouraging projections for late August and September.

The press release announces the updated total number of voting rights and shares for AFLYY as of May 31, 2024. The company reports 262,769,869 shares and a theoretical total of 290,243,169 voting rights. The theoretical voting rights include all voting rights, such as double voting rights.

On May 22, 2024, Air France-KLM announced the final results of its tender offer for two series of existing notes. The offer, launched on May 13, 2024, targeted €750 million in 1.875% notes due January 16, 2025, and €500 million in 3.875% notes due July 1, 2026. A total of €452.7 million, representing 36.2% of the outstanding notes, were tendered and accepted for purchase. After the completion of the tender offer, €515.2 million in 2025 notes and €282.1 million in 2026 notes will remain outstanding. The tender offer was funded by the issuance of €650 million in new notes with a 5-year maturity and a 4.625% annual coupon. This move is part of the company's strategy to manage its debt profile and extend its average maturity. The new notes are issued under Air France-KLM's €4.5 billion Euro Medium Term Note Programme.

On May 16, 2024, Air France-KLM announced an increase in the Maximum Acceptance Amount of its ongoing Tender Offer from €350 million to €450 million. This decision follows the successful issuance of new bonds on May 14, 2024, totaling €650 million with a 5-year maturity at a 4.625% coupon. The bond issuance attracted strong investor interest, with an orderbook exceeding €2.8 billion. The Tender Offer invites holders of €750 million 1.875% notes due January 2025 and €500 million 3.875% notes due July 2026 to tender their notes for cash.

Air France-KLM has successfully issued new bonds worth €650 million with a 5-year maturity and a 4.625% coupon.

The issuance, under its €4.5 billion Euro Medium Term Note Programme, saw strong demand, with an orderbook exceeding €2.8 billion, showcasing investor confidence. The new bonds are expected to be rated BBB- by Fitch and BB+ by S&P.

Proceeds will be used to refinance existing debt, including €750 million 1.875% notes due January 2025 and €500 million 3.875% notes due July 2026, and for general corporate purposes. An application for trading on Euronext Paris will be made.