Paris: AFI KLM E&M eyes new aircraft and locations for growth

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Air France Industries KLM Engineering & Maintenance grew revenue by 6% and increased profit by 76% in 2010 compared with the previous year. But the Franco-Dutch maintenance provider has warned that the industry crisis is "definitely not over."

Turnover during the financial year 2010 came to €1.03 billion ($1.48 billion) while the operating income grew from €81 million in 2008-09 to €143 million last year. The 76% profit jump was due to a favourable dollar-euro exchange rate change, revenue growth, productivity improvements and cost reductions especially in the hangars and backshops at the company's Amsterdam site, said AFI president Franck Terner.

He expects the company to grow "more than 6%", roughly twice as much as the predicted increase in the global MRO market.

Much of this growth is to come from developing more capabilities for new generation aircraft. The MRO provider wants to support Embraer 170/190 components and potentially its General Electric CF34-8E/10E engines, said KLM E&M executive vice-president Peter de Swert.

The company also wants to move into Airbus A350 and Boeing 787 maintenance, starting with component, then engine and eventually airframe support.

It is talking to several airlines and will reveal component support contracts in the next few months, de Swert said. With European airframe heavy maintenance moving gradually eastwards, de Swert said that the company has to decide whether to follow the competition and open new facilities "in the East".

However, Terner then added that the company "does not intend to transfer workload from here [western Europe] to the East", and that the company's strategy is to "grow in the East to support our jobs here".