Airline Air France-KLM is taking the right measures to protect its cash position and keep the company going during the current corona crisis. ING financial experts write it in a note.
First of all, KLM’s fleet will be reduced by 15 percent. According to ING, the speed with which that measure will be implemented shows that AF-KLM will not grow any grass over it, also in view of maintenance costs and the future in which more efficient aircraft will be flown. The aviation combination also took other measures to reduce costs.
AF-KLM is cautious in the outlook, ING notes. This is also because the situation differs per day. ING describes the liquidity of the company as reasonable, with both the French and Dutch governments guaranteeing bank loans. According to ING, this is particularly important if the road to recovery is to start soon.
For most of this year, according to ING, AF-KLM still has a buffer, pointing to the 6 billion euros that the company can rely on. In addition, cargo flights are still performed and maintenance work is carried out here and there.
ING maintains its hold rating for AF-KLM with a target price of 8 euros. At 9:50 am on Friday, the stock traded 1,1 percent higher at 4,96 euros.