Europe's biggest airline, Air France-KLM, has seen losses widen, as a result of redundancy payouts and higher fuel costs. The airline announced in June that it would be shedding 5,000 cabin crew and pilots from its French workforce.
The struggling Franco-Dutch airline suffered €895m ($1.1bn, £700m) of net losses in the three months to June. However its shares rose 18% after it predicted that operating profits for the rest of the year would be better than in 2011.
took a one-off charge of €368m to cover redundancy payments as part of plans to cut 10% of its workforce.
Revenues rose 4.5% in the quarter to €6.5bn, with the number of passengers up by 2.4%.However, the carrier saw a drop in its freight business due to the weak economic backdrop in Europe.
"These results demonstrate how crucial the success of the Transform 2015 plan is to the turnaround of the group," said chief executive Jean-Cyril Spinetta.
"In an increasingly uncertain global economic environment compounded by oil price and exchange rate volatility, an improvement in our productivity and costs is even more necessary."
The airline also saw a big rise in fuel costs, which jumped by €469m, while operating losses narrowed to €66m from €145m a year earlier.
Cabin crew and pilot redundancies
In June this year, Air France-KLM announced plans to cut more than 5,000 cabin crew, pilot and service jobs as part of a plan called Transform 2015.
It said at the time that it hoped to avoid compulsory redundancies through natural wastage and voluntary redundancies, and estimated about 1,700 jobs could be lost through natural turnover.
However, last week two out of three of the unions representing cabin crew rejected the cost cutting plans. Pilots are set to vote on the plans next month.
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