Air France-KLM S.A.

Okay. Thank you, operator.

Good morning, everyone and thank you for joining us today for the presentation of Air France-KLM's results for the first quarter of 2025. Today, I'm joined by Steven Zaat, our Group CFO.

I will start by covering the key highlights of the quarter before I hand it over to Steven, who will walk you through the detailed financial results. And then I'll close with an overview of our medium-term ambitions, before opening the floor to your questions.

So moving to Slide 3. So we're very proud to report that the group delivered an improved performance this quarter, once again demonstrating the resilience and strength of our business model.

Revenues were up 8% year-over-year, driven by a solid performance across all our activities including maintenance. Our operating result improved by €161 million reaching a negative €328 million, a significant step forward compared to the same period last year supported by strong unit revenue, development a more favorable fuel price environment and an overall improvement in operational performance.

I got to apologies for perhaps some background noise the building next door is under heavy travel work, so hopefully you can hear us clearly. Our net debt-to-EBITDA ratio now stands at 1.6 time fully aligned with our midterm ambition range of 1.5 time to 2.0 time.

Importantly, we generated a positive recurring adjusted operating free cash flow of €0.8 billion, highlighting the robustness of our cash generation capabilities even during the seasonally weakest quarter of the year. Finally in line with our commitment to sustainability, the share of new generation aircraft within the group increased by 7 percentage points compared to last year, now representing 28% of our total fleet On to Slide 4.

Despite a context of political and economic uncertainty, Europe continues to demonstrate its strength as a leading travel destination. So looking at industry bookings for the coming months, Europe is holding up against the turmoil with inbound traffic from both the United States and the rest of the world showing growth compared to last year.

It's worth noting that these markets are predominantly inbound towards Europe, 66% of the US traffic and 51% of the rest of the world traffic are inbound flows. As you can also see on the slide part of the missing US outbound traffic may be redirected to other regions of the world, where we as a group will be well-positioned to capitalize on our extensive network of destinations.

In this setup, France continues to serve as a key anchor for this momentum, maintaining its leadership position as the world's number one inbound tourism destination and also capitalizing on the positive coverage of the Olympics in 2024. Combined with our diversified network and strong exposure to international traffic this places us in a strategic position to mitigate the impact of current uncertainties and to adapt quickly if needed.

On to Slide 5. As we defined in 2019, we maintain a clear strategy of covering and enhancing all market segments to ensure we meet and ultimately exceed the expectations of our customers.

And at the entry-level segment, we address point-to-point leisure and price-sensitive markets through Transavia, pursuing our growth trajectory. This strategy already communicated previously will culminate in the full replacement of Air France's loss-making domestic operation by summer 2026.

Both Air France and KLM are simultaneously upgrading their long-haul premium offerings, focusing on capturing growth in both the premium corporate and premium leisure markets. This includes the development of economy comfort at KLM and premium comfort at KLM.

Both airlines now offer a business cabin seat with a door, establishing a new standard in business class travel. At the end of the market, the top end of the market, Air France has recently unveiled its new La Premiere suite.

As the pinnacle of our premiumization strategy, this launch elevates the level of excellence across the board and brings a strong luxury halo to our brand. We will take a closer look at this product on the next slide.

As I just mentioned, we're very, very proud with the successful launch of our new Air France La Premiere cabin, which was officially unveiled during a global media reveal on March 18 in Paris, and performed its inaugural flight to New York, JFK on April 8. The new cabin offers a stunning 3.5 square meters of personal space, five windows in length, making it the longest first-class suite on the market, featuring outstanding amenities such as a separate arm chair, and a chair that transforms into a fully flat bed, with the option of a fully partitioned double suite for complete privacy.

This enhancement complements the complete revamp of our La Première ground experience finalized in summer 2024, together delivering seamless and exclusive service at every stage of the customer journey. La Première is the ultimate expression of our luxury vision, delivering an exceptional level of experience both on the ground and in the air.

And this launch marks a major milestone in reinforcing Air France's position, as a global leader in premium travel. And I'm very happy to share, that prior to COVID, this cabin this service was heavily loss-making.

We don't break out the details. Very pleased to share that in Q1, this service is now in a very strong financial performance result and we are profitable in La Première.

Moving on now to the final slide here. So, I'd like to take a moment to thank every one of my colleagues, who contributed to turning the vision behind this product into a reality for our business.

With that, I'll now hand it over to Steven, who will take you through the detailed financial results. Thank you.

Thank you, Ben and good morning everybody on this beautiful day. I said last quarter that, one swallow doesn't make a summer, but you can imagine that we are happy that we have seen a second swallow before even the summer has to come.

We improved our margin by 3%, but let's go to those details on Page 8. If you go to Page 8, you see that we had a very strong development of unit revenue and there was of course the tailwind of the fuel price.

In total, we were able to grow our revenues by 7.7%, 4% is coming from the capacity growth and 3% is coming from our unit revenues and that's around 1% coming from the currency. So the unit revenue increased by 3%.

The unit cost increased also by 2.1%, but that is for a big chunk also related to our unit revenue development. So you see that the differential between the unit revenue and the unit cost brought for us an additional percentage in terms of margin.

And the other 1.8% is actually coming from let's say, the fuel price and the currency. It's around 1.9% margin improvement coming over there.

And it's good to see that, we have at least a cushion for the quarters to come in these uncertain times. And this result, this improvement of operating margin, we should also keep in mind, that last year we had Easter in the first quarter and we have now Easter in the second quarter.

We don't lay out a specific number, but you can imagine that this Easter impact will support our second quarter. If we then go to Page 9, then you see the differences over the network.

Let's start on the passenger business on the network, an improvement of our unit revenue of 2.8% especially driven by a stronger yield. The load factor is slightly down, but we have seen that the steering especially for yield in this quarter has helped us also to increase our yield over the whole network.

So as you still can remember maybe last quarter, we started the quarter with a booking load factor of 2% gap. And at the end of the day, we closed almost that whole booking load factor especially coming from a very strong unit revenues from the premium, which I will detail out further on the coming page.

Cargo also very strong 16.2% both coming from a load factor increase of 2% and also heavy unit revenue increase from our cargo segment and that drives in total up our network performance by €163 million. Then on Transavia.

Transavia, we grew our capacity by close to 4%. Our unit revenue is more or less flattish, despite the fact that that has been, let's say, supported by the paid hand luggage.

So let's say, if you would have taken out, let's say the unit revenue is slightly down and that's coming actually by four impacts. First, Transavia is very dependent on Easter and holiday season.

And as we move the holiday season to the second quarter, that for sure has an impact on Transavia. Second, the weather was very bad in Spain.

So 44% of Transavia in the Netherlands is flying to Spain in this quarter. And you see that the bad weather and also the fact that we didn't have Easter impacted Transavia as well.

And we should not forget the introduction of the ticket tax in the Netherlands bringing more than €25 on the tickets that didn't help this business segment and that moved actually passengers towards Germany and towards Belgium, so a bad implementation actually from another additional tax on our industry. And last but not least, we don't have to forget we grow this capacity.

So for sure we know always that the first quarter is difficult in the low-cost segment. So we are going to regain those results in the quarters to come.

Then on maintenance. Maintenance, a significant step-up in the revenues supported also by a stronger dollar.

We see that the engine business is actually booming. So both on the revenue side and the operating results side it's fully coming from a very booming engine business both in the Netherlands and in France.

So good to see that we are heading towards the margins, which we had pre-COVID for our engineering and maintenance despite the fact that there are still let's say some difficulties in the supply chain and especially hurting our components business. But all-in-all, very strong results for the engine business on which we can very proud of.

If we then go to page 10, let's start with of course both carriers improved the results coming from the fact that the fuel price is coming down and partly that has been eaten up by the higher US dollar, which is negative in terms of our cost. So at all, let's say we have a positive impact from that fuel wind both for Air France as for KLM.

Air France has a very strong unit revenue increase coming from the premium. So the premium demand is really, really strong resulting in high yields.

And on KLM you see even a higher unit revenue growth, specifically coming from a very strong implementation of the premium economy. KLM increased the capacity by more than 60% on the premium economy.

The yield over there was up 9% and the load factor is up 2%. So it's good to see that the revenue growth of premium economy for KLM grew by more than 80%.

Then we see the first signs of the contract coming in, so especially by a better operation and also a better performance of the engine maintenance business as just explained. And, of course, we had a one-off cost of €50 million last year in Q1, which we didn't have this year in the first quarter, which helped also and supported the KLM results.

What is important now for us is that we get the productivity delivered to the CLAs. We are currently in those discussions.

So that should happen from Q2 onwards. And we have unfortunately also in the second quarter this ridiculous increase of the triple tariffs by 40%.

So that will kick in the second quarter. Then on Flying Blue.

On Flying Blue, we see a stable performance due to the fact that we have a very strong yield and we have let's say very tight seats available. We reduced a bit the Flying Blue activity to that segment.

We signed a commercial agreement with American Express, which will be there until September 2033 but the result of that will kick in from the 1st of January 2026. So Flying Blue is still a very, very decent margin.

But we have a little bit more tightness in our revenue management system to give access to our Flying Blue passengers. If we then go to page 11, then you see that we have on every -- let's say if you look at the premium and the economy and the total you see that we have a positive yield impact, very strong on the premium.

We grew our capacity by close to 6% and resulting even with a yield improvement of 7%. On the economy, we grew only by 2.2%.

You see a positive yield impact of 1.7% but that's purely coming from the successful implementation of the premium economy. We grew the capacity over there for Air France-KLM in total with 21% and with a yield increase of 5% and also, a load factor increase in 2%.

So a lot of demand of this premium product in the economy where there is more to come. If we then look at the total long haul, you see a very strong West side.

So the US with an 8% increase in yield has been, of course, very, very strong. But also Latin America is at 4.5% and even Asia at 6.2%.

We reduced the capacity towards Asia but that's not on the real Asia, let's say, it is a reduction of capacity of the Middle East and we had a slight increase of the Asian capacity. Strong yield development in India China and also Japan and also in Korea.

So the Asian segment is developing well, especially in attractiveness in terms of yield. Then if we look at the middle, you see let's first start with short and medium haul.

We increased our capacity significantly, which is for a big chunk coming from the fact that last year we had an ATC closure. So we needed to reduce our capacity significantly and that drove down the capacity last year.

So we restored that capacity now and that's actually representing this increase in our short and medium haul with a slight decrease also in yields, which is also coming from the fact that there was less capacity and also from the competition in 2024 first quarter. Then on Transavia, as already said, so we increased capacity by close to 14%, minus 2% in terms of load factor coming from the Eastern impact and an increase of yield of 2.3% supported by the paid hand luggage, which we implemented in the second quarter.

So we still had a positive in the first quarter. So in a nutshell, very strong result in the East and West, very strong results in the premium segment and I will come back to you later, if we talk about the second part of what we see in the US and what we see at the rest of our network.

If we then go to page 12, and I think this shows for us pretty well what is our strategy and how we are going to improve our margins. So you see the unit revenue is up 3%, despite the fact that there was no Easter.

That goes hand-in-hand with a unit cost increase of 2.1%. But out of this 2.1%, there's 1.1% coming from unit revenue-related costs.

A part is coming from the capacity mix. So we have more medium haul flying than long haul.

So that by definition grow your unit cost, and it comes from the premiumization of the cabin where we have 3.4% more growth in the business class and 21% growth in our premium economy. And last but not least, the 0.7% of total cost increase of our total unit cost coming from our airport and ATC charges.

I want to repeat it again. Also in the first quarter, the triple tariffs went up and we see it again going up further with 40% in the second quarter.

But then all the costs which we have in our hands, let's first say that we still have on the labor price an increase. We had a one-off payment of €50 million.

So if you take that into account the labor price impact on our unit cost was 2.3%. But it's good to see that we partly absorbed that by increased productivity and we know that there still needs productivity to come from KLM.

So it's a 0.6% productivity impact on our unit cost, which is an improvement of our productivity of the staff of 2%. And last but not least, also related by, let's say, the much better operations, which we have run in this quarter.

That has a positive impact of 0.6% on our unit cost. And that is actually also part of, let's say, the KLM back on track part to improve the operations to make sure that we are having the right product for our customers and that we don't spend it on EU 261 compensation.

If you look at the next quarter, we will probably be at the high end of our range. I already told you we have an increase of triple tariffs of an outrageous 40%.

And we still have high maintenance costs on the KLM side, and we still have to see that the productivity comes in with the CLA, which actually we are now already, let's say, over one month after the closure of the SLA date because it should be closed on the 1st of March, 2025. So it takes a bit of a delay but there will be productivity gains coming in the second quarter but it's absorbed by higher maintenance costs and also this increase of the triple tariff.

If we then go to the cash. So €1 billion operating free cash flow, of course, very strongly supported by €1.5 billion sales in tickets, but we are really ahead of our own internal plans in terms of free cash flow delivery €800 million we reached.

So we are quite happy with the strong free cash flow performance in this quarter. It brought down our net debt by -- from 7.3 to 6.9 and it improved our leverage from 1.7 to 1.6.

Still a very strong cash at hand. It's €9.3 billion.

We reduced our liabilities with €700 million and we paid €500 million of a bond out of our own cash. So very strong cash development in this quarter.

Let's then go to the outlook. Let's go to page 15.

And of course everybody is coming here to listen what we are going to tell you about what's happening in the future. Let's first go to the picture of the booking load factor.

So we see that we are down compared to last year in terms of forward booking load factor which was also the case last quarter. So there is a gap of 3% on the total long haul, on the North Atlantic actually it's only 2%.

So it is less on the North Atlantic than on the total long haul. And on the short and medium haul, we are very close to where we were last year.

And it's good to see that Transavia sold already 71% of their seats. So on that side it looks pretty good.

Then if we then go to let's say the situation in the US. What we have seen in April so far is that we actually see and it was already explained by Ben that we see a shift from the point of sales to US, which is getting stronger from the point of sale Europe.

Usually we have -- on Air France we have around 46% of our tickets are sold in Europe. For KLM it's around 50% and we have seen that in the first few weeks that -- that is going down in -- for Air France in Europe to 43% and for KLM to 46%, but it's shifted to the US.

So the shift is around 3% from Europe to the US for Air France and 4% for KLM. And usually the point of sale of the US is much stronger in terms of pricing than what is happening in the US.

And I will come back later on the differential between on our US network what we see in terms of load factor and yield. If we go to the first three weeks of April because we have only three weeks, let's say, in our books we see that on the long haul the load factor is up 1%.

So if you see that the forward bookings is down 3% in the April when we get closing we are higher than last year. We had a yield of 3.9% increase on the long haul.

On the North America we see that we have around the same load factor as we had last year. It is down 0.2%, but the yield is up still 5.1%.

And if we go to Europe the load factor is up with 1.3% and the yield is up with 1.9%. So of the total network the load factor is up by 1% and the yield is up 3.6% for sure also impacted by Easter.

So for sure that has an impact on this yield development. If we then go to the specifics on the US.

If we look at the forward bookings for May and June you see that the load factor in May is down 3%, but the yield is up 4%. And in June the load factor is down also 3% booking load factor and the yield is up 6%.

So still a very strong pricing dynamics on this segment. We see very strong bookings on the premium where even our unit revenue is strongly up.

We see a very strong booking also on the premium economy as we have seen also on the first quarter in the US. And it is as Ben already explained in last weeks to the press we see a little bit of softening in the, let's say, the lower class yield passengers.

But overall we still have a positive unit revenue in May and June and for sure in April as I just explained on our US segment. If we then go to page 16.

And as our only Dutch philosopher always say, Johan Cruyff every desert has also an advantage. You see the fuel price comes down with $300 million in dollars compared to what we have guided last quarter.

So a strong decrease coming from this fuel bill and it's even €600 million below last year. So that is a good cushion for whatever happens on let's say the traffic related to the US situation to let's say have a cushion from our reduction of our fuel bill.

And also the good news, we have almost 70% hedged for the year 2025 at very favorable hedge terms. Then let's go to the outlook.

So we keep our outlook. I think despite there is of course uncertainty we still see that the demand is as described in the previous section is still continuing.

Of course, especially the second quarter and the third quarter are the best quarters in terms of pricing and in terms of profitability. So these quarters and especially in the high summer in July and August, you can sell any ticket you want.

So on the long haul, we are at 3% to 5%. We guide you the same 3.5% short and medium 3.5%.

And for Transavia, we will be at the 10%. So the guidance has not been changed.

We will have an agile approach on our network, if we see a deterioration coming, but we expect that it will be more coming when the winter is kicking in than when the summer is kicking in as it is a high profitable season. And then for the full year, the outlook so we didn't change the group capacity outlook, the unit cost we are still comfortable with the low single-digit increase, although we repeat again, we will be at the high end of the range in the second quarter due to Schiphol and due to the maintenance tariffs, where we also had last quarter a compensation by the way on this.

So there's also a one-time effect which we have in the second quarter. But we will be in the second quarter at the higher range of that low single-digit increase and then we will further continue with the growth as we have seen in this quarter.

We stick to the CapEx which of course, it's still too soon to tell. But if we are going to develop our network definitely, we will also of course, will be agile in our CapEx and we are sticking to the net debt to EBITDA which we improved this quarter between 1.5 and 2.

So I think I give enough coloring on everything what's happening in the US. This is all the figures we have but with that, I hand over to Ben and I will answer later the questions you want.

Okay. Thank you, Steven.

So just a quick summary here. So we'd like to highlight a few takeaways.

So first we had a strong start to the year, as you've just heard. We see solid summer ticket sales and that's being driven by revenue growth and improved cash flow across all businesses.

And second, we remain agile in the face of current macroeconomic uncertainty. So we have a very well-diversified network as you know, strong attractiveness of our inbound markets.

We're well-positioned to respond and adapt to shifts caused by geopolitical and economic factors. And lastly, premiumization continues to be a core pillar of our strategy with expanded offers both at KLM and Air France.

And as I've already mentioned with the unveiling of the new La Premiere cabin at Air France, we reaffirm our commitment to leading the way in luxury travel and delivering excellence at every stage of our customers' journey. The brands are really continuing to gain traction into and out of our markets.

Fourth, we are making steady progress on sustainability with a further increase in our share of new generation aircraft advancing us toward our decarbonization goals. So 2025 outlook remains unchanged.

We will maintain our capacity and unit cost guidance. And with our agile approach to capacity deployment and favorable fuel dynamics, we're confident that our strategy will continue to drive profitable results.

So thank you for listening to our preliminary presentation and we are now available to take any of your questions.

Good morning everyone. Thanks for the presentation.

Steve and Ben you say that the guidance is unchanged and it looks like the building blocks indeed obviously are the same. But in Q4 you did say that you should be able to do at least €300 million in profit progression.

And I guess you also got the more of a fuel tailwind now. Can you kind of confirm that you're still happy with at least €300 million in profit progression?

Then secondly I know very short-term booking windows. But any commentary on what you're seeing on air freight?

It looks like certainly March was very strong, but just any comments on how you're seeing things especially around restocking ahead of potential tariffs? And then just lastly, I guess linked to tariffs, any views on how this will affect your business, especially related to CapEx and maintenance costs?

Thanks.

So, hi Jarrod, how are you? Let's start with the guidance.

So, we don't give a profit guidance. Let's start over there.

We explained last year that there were €600 million coming from all kind of incidentals, for instance, the Olympic Games. That will not happen this year.

That I can fully guarantee you. We also said that there was €300 million of headwinds, which are let's say are kicking in in the current let's say triple tariffs, which I explained and also the increase of the French tax aviation, which is impacting our unit revenues.

So, we still stand by with the €300 million impact coming from these incidentals of last year. And then there's all kind of other things happening.

For instance we have the fuel bill, we have the revenues and the unit cost. On the unit cost, we've given very clear guidance.

And I think I gave you some coloring on the second quarter and also what we expect for the summer. On the air freight, we see not a -- but you know the booking window is very, very, very, very short.

It's three weeks ahead. We are exposed only 2% from let's say flows between the U.S.

and China, so there's not so much coming over there. And so we don't see any real impact on the softening on the airfreight yet.

But again it's very too soon to tell. It's also a little bit of a weak quarter.

So, it would have been the fourth quarter we could have probably seen a bigger impact coming from all these tariff impacts. And then on the maintenance, so let's first start if you look at the planes which we bought we bought almost only Airbus planes.

So, for the fleet deliveries if you refer to that we don't expect any issues. We have only four 787-10 to come.

And I think we will not -- yes, so we have all Airbus fleet and so we are not very dependent on let's say all the deliveries of Boeing. Then there is the question mark on the maintenance cost for the quarters to come.

That is too soon to tell to be honest. First, the U.S.

is an exporter of aviation. So, they really would hurt themselves if they would continue to stick on that part.

And it all depends for us more on the retaliation from Europe. So, for now that is let's say still under discussions but more the retaliation of Europe than what is happening in the U.S., although there are parts which are coming from the U.S.

which are let's say coming out of Europe. But for this time I think, it is too soon to tell.

And we know that let's say if you look in the contracts, usually there's not an exception to make for any U.S. tariffs.

So, for any sorry tariffs -- import tariffs you have. So, -- but we are carefully watching the situation and we will aggressively reply to any suppliers which are intending to increase their fees.

Thank you.

Morning gentlemen. Two from me.

Firstly, if I could please focus on the transatlantic just for a moment. Thanks for the helpful color about Q2.

Lufthansa yesterday were talking about a gap in bookings for Q3. I appreciate, it's a little bit far away, but I wondered if you could maybe comment a bit on presumably the gap on book load factors is maybe a bit wider for Q3 at the moment.

And they were suggesting that reciprocal tariffs had caused a hesitancy in booking, but they felt those volumes might still come through just in a shorter later booking window. So they don't think that those volumes are necessarily lost.

Just wondered, if you thought that's the case or whether you can envisage having to do some price stimulation to fill the economy transatlantic cabin for Q3? And then secondly, feel free to ignore this, but I just want to follow up on Jarrod's question to be totally clear.

You're standing by there being a €300 million benefit from all the big moving parts you highlighted, but you're not committing to the net of everything else yields cost fuel being neutral or supplemental to that which is kind of what we inferred hopefully correctly at the full year results. Thanks.

Let's say, what you say on the bookings for the third quarter, I think, it is true what you're saying. We don't see let's say, a further increase of the gap between last year.

So it is even a bit down if I look for instance on July. And the further you come the more difficult it is to say.

So I think on July and August it looks very good. And on September, we -- yeah, that's still too far away because it's a very low number of seats which we are selling so far ahead, because there's also a lot of business traffic in that month.

On the €300 million, I think I clearly guide you on the unit cost. I think you have a view on the yields.

But we don't give any profit guidance. So that is true.

We don't give a profit guidance, but this €300 million coming from let's say, incidentals of last year is still to be around.

And perhaps, Jaime, I could add one extra compare point here. We -- Air France-KLM our exposure to the United States transatlantic market, so we just specify the United States where 26% of our capacity is to and from the U.S.

or if you look at our two major competitors based here in Europe there between 37% and 47%. So we're at 26%.

So our exposure is far less than the two other groups here in Europe.

Thanks guys.

Good morning, Ben and Steven. Two questions, if I can.

Just on your network directly, do you have any tangible or even anecdotal evidence that potential U.S. traffic is maybe substituting or transferring to other destinations outside of the U.S.

whether that's long-haul or short-haul? And if so where is that traffic going to instead?

And then, just on the ex-fuel unit cost apologies, I might have misheard it slightly Steven. I think you mentioned maybe there's another one-time compensation effect in Q2 or in the base last year.

So could you just go over that again? And then just a follow-up on that, how much of the total ex-fuel unit cost increase in Q2 will be related to the ship tariff increase?

Thanks a lot.

Okay. Thanks Harry.

So we are seeing some slight shift in the overall -- if you look at our overall capacity toward Canada, quite a little bit to Latin America. But no Canada is holding up and actually seeing some growth.

But as we've already mentioned premium, so La Première business as well as premium economy are actually doing better than we would have expected across all markets to and from the United States as well. So it's the economy cabins where we're seeing the softness in particular on the transatlantic.

And we do see the stimulation impact being positive when we do lower pricing. And we're just we're taking it a little slower than we normally would to see how things play out because we know there are a lot of customers that are just -- they're holding back on buying tickets to get a little bit more clarity on how we do things across the border or things like that.

But when we lower pricing we're seeing volume is still there. But because of our well-diversified market we're not shifting any capacity as of yet.

I don't see us shifting any capacity through Q3 and perhaps in Q4 if necessary we'll start to relook at that. But as of today we're maintaining our capacity across the network as planned that we put into the various sales channels last year.

Nothing has shifted yet.

Hi, Harry. So let's say, the compensation was last year.

So we had -- last year, we had a one-off compensation which we -- which was of course, dampening our maintenance cost. So if you look year-on-year that will impact our year-on-year development.

For the rest -- for the remaining part, there's not so much strength things happening on the maintenance cost, but you should take that into your consideration. And that is also what we, let's say, guided already earlier that we see actually till the end of the second quarter higher maintenance costs coming in, but we are still within, let's say, the upper range of the unit guidance.

So it is not that there's something really out of -- how do you say out of sync. On Schiphol, I would say, I think, it is around €100 million even more than €100 million per year.

So you can say -- you can almost calculate yourself. So you come to I think 0.3% or 0.4% on the total unit cost of Air France-KLM.

It's not only Schiphol, which increases the tariff. So we see that it is not only coming from that part.

And we have the ATC charges. But I think that is -- we already explained that also for the first quarter which we see in the whole industry.

But if you look specifically on this outrageous increase of Schiphol‚ tariff yes that is the €30 million which you can consider.

Great. Okay.

Thanks guys.

Hi, there. Can I come back to the back on track in KLM and the negotiations around the CLA?

I think you were previously targeting 0% tariff increases and incremental productivity. We were a month behind schedule.

What should we be hoping for? And is there any risk?

I know it's rare because the Dutch are generally calm but is there any risk of disputes as we go into summer peak? And then the second question would perhaps come back to the M&A situation in Europe with the less certain trading outlook do you think the potential M&A deals at Tap Europa where you've been publicly looking are they still as interesting today when we face a less clear trading environment less clear profitability and hence balance sheet outlook?

Okay. Andrew the CLAs they're moving along and the most important one and the most difficult one being with the pilots at KLM.

We're quite optimistic we'll be able to secure what it is that we need to maintain back on track as committed. I can just share something which I never would have imagined ever since I've now been here 6.5 years.

We will have Air France pilots flying KLM aircraft to help get the capacity up at KLM starting this summer on JFK to Amsterdam which is a real big step forward to show alignment with the KLM pilots that we need to do things that we normally wouldn't do to strengthen the KLM business. So that's been a very -- it's a very strong signal to show that the alignment between the KLM pilot and management is stronger than ever.

So I'm optimistic we can get the necessary ingredients that are required to stay with our back on track program. On the M&A front, on SAS, nothing's changed.

We have a couple of options on how we take our stake up to a majority with the other investors. And everything is going as planned.

I think we've got full flexibility. We're quite pleased with how things are working out despite the fact that they're not already in the joint venture on the transatlantic.

So, no change on SAS, if not a little bit, more positive than I was expecting in terms of the way that business is moving. And then on the Iberian Peninsula, as you know, the process -- the official process for the sale of TAP has still not started.

So that file is not -- there's nothing going on there. And Air Europa, we're continuing to discuss with the owners if there is a deal to be had, so nothing more to share here because of the uncertainty across with the new US administration.

So far, it hasn't slowed down any of the discussions that we're having with the owners of Air Europa.

Perfect. Thank you.

Good morning, gentlemen. Thank you for presentation and taking my questions.

One for me if I may only. Regarding your costs, namely on staff.

We have two different things here at hand. One of them is your premiumization and on the other hand is your fleet expansion.

How do you see your staff numbers and costs going from there? Is there any more benefits you can take in terms of efficiencies considering the increase in your fleet?

And how does this play out considering the premiumization aspect on the other side? Thank you.

So, yes, so we have two impacts. So one impact is of course indeed the premiumization.

When I talk here about the productivity, I don't even exclude the premiumization impact of it. So we still -- we will -- as we guide you, you see that our capacity is still growing and we continue let's say to implement measures to improve our productivity.

The CLA at KLM is crucial for that. But on the ground for instance, you don't even need a CLA.

It is just making sure that you are getting your operations in order and to be efficient as possible. So, for the quarters to come, we even expect that the productivity will go up and especially the implementation of back on track is key for that.

Okay. Thank you, operator, and thank you to those who are still on the line for listening in this morning.