Air France-KLM : Skies are looking brighter
Publication date 10/08/2017 15:56 - Writing date 10/08/2017 15:52 - - - AFFP bonds - / - Source : Bloomberg - - Next events - EGM : 4 September 2017 - Q3 17 results : 3 November 2017 - - Air France-KLM has posted strong results since YTD, driven by strengthening traffic and resilient unit revenue. This performance, coupled with continued favourable trends in the environment at this juncture (no oil price hikes, a drop in the dollar since April and return of demand for long-haul) guides for better results which was expected at the beginning of the year (for example, the Consensus for FY 17 EBITDA is now at € 3.0bn, whereas it stood at € 2.3bn at end-February) and for faster deleveraging. - Another good news is that Air France-KLM will strengthen its ties with Delta and China Eastern through a reserved capital increase of € 751m to be approved at its shareholders’ general meeting in early September. This contribution will be used in particular to finance its entry into Virgin Atlantic’s capital for £ 220m. - Pending the completion of the capital increase, we maintain our 'BB' rating, but we are raising the outlook to Positive from Stable, with the aim of upgrading our estimated rating to 'BB+' based on the group’s financial health at the end of 2017. Given current spread levels, this also leads us to upgrade our recommendations from Neutral to Buy on the senior 2018, 2021 and 2022 AFFP bonds and to maintain our "Buy & Hold†recommendation on perpetual bonds, call 2020. Lastly, we reiterate our Neutral recommendation on the 2023 convertible bond, put 2019. - - - - >Air France-KLM is a holding company. Through its subsidiaries, Co. is engaged in transporting passengers and cargo, aeronautics maintenance and other air-transport related activities, including catering and charter services. Co. operates in six geographical regions: Metropolitan France; Europe (except France) and North Africa; Caribbean, French Guiana and Indian Ocean; Africa, Middle East; Americas, Polynesia; and Asia and New Caledonia. Co. organizes its business around the following four segments: Passenger, providing passenger transportation services on scheduled flights; Cargo, transporting freight on flights and selling cargo capacity to third parties; Maintenance, and Other activities.
Oddo Securities provides securities brokerage and research services. The company offers equity, economic, and derivatives research and credit analysis services. It focuses on insurance, automotive, building materials, pharmaceuticals, telecommunications, information technology, and agri-food industries.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.