Profits at French airline Air France fell by 97% in its first quarter to June compared with a year earlier, due to the triple impact of a weak global economy, the spread of SARS and strikes.
Net profit in the April-June period was _4m, down from _159m a year earlier, but the figure beat analysts' expectations of a net loss.
The company blamed a deterioration in the business climate, aggravated by the conflict in Iraq, the SARS epidemic, and strikes by air traffic controllers in France, for the hefty drop in first-quarter net profit.
But the state-controlled company said it still expected operating profit to be 'slightly positive' for its full year to March 2004.
'The first three weeks of August have confirmed the rebound in traffic discernible over the past two months,' Air France said.
The airline company reported an operating loss of _13m, excluding aeronautic disposals, compared with an operating profit of _152m a year earlier. Passenger traffic fell 5.7% in the first quarter, while capacity was reduced by 3%. The company's seat load factor fell 2.1 points to 74.4%.
The French state currently owns 54.4% of Air France's shares but is seeking to reduce its stake to roughly 20%.
