European airline earnings: Air France surges while Ryanair dips

Air France-KLM Group surged the most in eight months as a 2 billion-euro ($2.5 billion) savings plan helped halve its second-quarter loss. Discount rival Ryanair Holdings Plc fell as fuel costs led to a 29 percent profit drop. Air France, Europe’s biggest airline, had an operating loss of 66 million euros, down from 145 million euros a year earlier, beating the 163 million-euro estimate of analysts surveyed by Bloomberg. Ryanair, the region’s top low-cost carrier, said net income shrank to 98.8 million euros from 139.3 million euros. Air France-KLM rose as much as 13 percent, the sharpest gain since Nov. 24, and was trading 50 cents higher at 4.39 euros as of 11:19 a.m. in Paris, where the company is based. Ryanair, which has its headquarters in Dublin, slipped 5.4 percent and later traded 2.1 percent lower at 3.82 euros. “Air France is going in the right direction but I’m still not convinced that they’re prepared to be radical enough in the face of industrial strife over job cuts,” said John Strickland, director of JLS Consulting in London. “Ryanair on the other hand will do whatever’s necessary in terms of grounding aircraft when demand is low, and they don’t have labor issues to worry about.” Air France-KLM said last month it would eliminate more than 5,000 jobs at its French unit as Chief Executive Officer Jean- Cyril Spinetta seeks the savings he says are needed to guarantee survival. As the economic slump combines with volatile oil prices and exchange rates, the quarterly results show how crucial the Transform 2015 turnaroun