PARIS: Air France announced on Tuesday its net profit soared by 18.9 per cent in the business year to March 2001 as it kept a tight rein on costs in the face of higher oil prices.

Net profit climbed to 421 million euros (US$360 million), the airline said in a statement, cautiously forecasting a similar performance for the year ahead.

It said operating income rose by 23.4 per cent over the same period to 443 million euros (US$381 million), despite fuel costs leaping 609 million euros (US$524 million), or 60 per cent, to 1.62 billion euros (US$1.39 billion).

Turnover rose 18.9 per cent to 12.28 billion euros (US$10.56 billion).

"We have every right to be satisfied with the results for the last financial year," Air France Chairman Jean-Cyril Spinetta said in the statement after the board rubber-stamped the accounts.

"Despite the adverse effect of the very steep increase in fuel prices and the cost of integrating our regional carriers, these results confirm our strong sales performance," he added.

"Thanks to tight control over both unit revenue and costs, we have been able to post a consolidated net profit of 421 million euros (US$360 million), up almost 19 per cent."

Spinetta said the performance would enable Air France to increase profit-sharing for employees by 46 per cent and to pay shareholders a net dividend of 0.22 euros (US$0.19), up 57 per cent from last year.

Air France had hedged 56 per cent of its fuel requirements at an average price after hedging of US$22.5 a barrel on the basis of a market price of US$27.5.

"In light of these figures and if there is no downturn in the current economic climate on Air France's markets, Air France aims at achieving results in the current financial year on a par with those of the previous year," the statement said.

Air France shares fell 0.34 euros (US$0.29), or 1.6 per cent, to 21.41 euros (US$18.4) on the Paris stock exchange before the results were released.

The net profit result beat the consensus market forecast of US$383 million, according to a survey by the Jacques Chahine Group. Forecasts had ranged from 308 to 515 million euros (US$265 to US$443 million).

Air France said operating costs totalled 11.93 billion euros (US$10.25 billion), an increase of 19.4 per cent.

Fuel costs, which accounted for 13.2 per cent of turnover compared with 9.8 per cent the previous year, rose 60 per cent to 1.62 billion euros (US$1.39 billion). The steep rise followed "the sharp increase in the cost of jet fuel and the appreciation of the dollar against the euro during the financial year," Air France said.

Before consolidation of regional airline subsidiaries, passenger capacity measured in available seat kilometres rose by 6.3 per cent while traffic measured in revenue passenger-kilometre grew 9.1 per cent.

Agencies via Xinhua