Klm Posts Sharply Lower Operating Profit

First half operating profit fell to 262 million guilders ($154.7 million) from 497 million guilders.

However net profit rose to 529 million guilders from 437 million due to profits on the sale and revaluation of its preferred shareholding in US partner Northwest Airlines.

KLM said it expected second half operating income to be lower than last year, due largely to higher fuel costs.

The airline said it was launching a far-reaching new restructuring programme to boost its operating income and would announce further details later today. Analysts had expected KLM to report a first-half net profit of 457-639 million guilders. At 1140 GMT KLM shares were up 1.90 guilders at 43.80.