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AFI KLM E&M Wins More Third-Party Work

Excluding work for its parent, the MRO department contributed 10% of total revenues for the Air France-KLM group.

AFI KLM E&M has registered a strong start to the year with third-party sales up 15% in the six months to June 30.

Third-party MRO sales of €1.1 billion ($12.2 billion) represented 47.2% of the AFI KLM E&M’s total sales, up from 45.2% in the prior-year period.

Excluding work for its parent, the MRO department contributed 10% of total revenues for the Air France-KLM group.

As the group’s network airlines and low-cost carrier Transavia struggled to stay in the black, AFI-KLM E&M also prevented a group-wide operating loss.

Operating margin for AFI KLM E&M was 4.9%, up 0.3 percentage points on the prior-year period and comfortably ahead of the group average of 0.7%.

Air France-KLM said the improvement was down to an “inflow of new contracts” that pushed up third-part revenues by 7.6% in the first half on a constant currency basis.

“The Group’s growth is being driven by the engine and component support businesses in particular, which are high-added-value activities deploying state-of-the-art industrial technologies,” stated Air France-KLM.

The group added that AFI KLM E&M was seeking a “major role” in the support of new-generaiton widebodies such as the Boeing 787 and Airbus A350, and that it continued to seek partnerships across the globe.

In June the MRO provider and Triumph Group announced an aftermarket strategic partnership to give airlines and MRO customers global coverage for aftermarket services. The parties envision a wide-ranging scope for the partnership, including services such as spares pooling and repair development for aerostructures and engine nacelles.

At June 30, 2019, AFI KLM E&M’s orderbook stood at $11.6 billion, or about five years’ revenues.

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