AFI KLM E&M Performs Well In Difficult Year For Parent

France is a hotbed of MRO activity, home to not just several airlines but also component shops, independent MROs and industry giants such as Safran.

Air France Industries KLM Engineering & Maintenance made good on its solid start to 2019 by finishing the year with an operating profit of €260 million ($281 million), €46 million higher than its 2018 result.

That represented roughly a quarter of Air France-KLM group operating profit after another difficult year for the airline business.

Fourth quarter operating profit at the maintenance arm, meanwhile, was more than double the prior-year figure, while third-party revenue for the year was up by 11.3%.

In the first half of the year, to 30 June 2019, third-party sales were up by 15%.

AFI KLM E&M said that its full-year performance was supported by positive performance from all business segments – airframes, engines and components. The better result also included a higher operating margin of 5.6%, o07 percentage points above that of 2018.

At year-end its orderbook was worth $11.5 billion, roughly the same as the previous year.

Late last year it highlighted Asia as the strong driver of growth for the business and this was reinforced by a deal with Garuda Indonesia and its maintenance arm, GMF Aeroasia, covering A330 component support.

Under the deal, the Franco-Dutch MRO will provide repair and parts pooling services for Garuda Indonesia’s fleet of A330s and offer training and industrial development support to GMF so that the latter may take on some of its MRO operations. 

The A330 agreement was part of a strategic partnership signed a year earlier and designed to enhance GMF’s widebody capabilities and boost AFI KLM E&M’s presence in the fast-growing Southeast Asia market. 

GMF also has a cooperation deal with Lithuanian MRO provider FL Technics covering parts supply, engine maintenance, marketing and aircraft maintenance. 

Alex Derber

Alex Derber, a UK-based aviation journalist, is editor of the Engine Yearbook and a contributor to Aviation Week and Inside MRO.