shareholders’ · 2018-05-15 · of share capital increases (12th resolution) 23 purpose >...
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SHAREHOLDERS’
MEETING
MAY 15, 2018
OPENING
PARIS
PRESENTATION OF
THE RESOLUTIONS
A I R F R A N C E - K L M
RESOLUTIONS SUBMITTED TO THE SHAREHOLDERS’ MEETING -ORDINARY BUSINESS
4
1st resolution: Approval of the statutory financial
statements and transactions for the financial year
ended December 31, 2017
2nd resolution: Approval of the consolidated financial
statements and transactions for the financial year
ended December 31, 2017
3rd resolution: Allocation of the income (or loss)
for the financial year ended December 31, 2017
4th resolution: Ratification of the co-opting
of Ms. Anne-Marie Idrac as a Board director
5th resolution: Re-appointment of Ms. Isabelle Parize
as a Board director for a four-year term
6th resolution: Appointment of Mr. François Robardet
as a Board director representing the employee
shareholders (ground staff and cabin crew employee
shareholders) for a four-year term
7th resolution: Appointment of Mr. Paul Farges
as a Board director representing the employee
shareholders (flight deck crew employee shareholders)
for a four-year term
8th resolution: Vote on the elements of compensation
paid or granted to Mr. Jean-Marc Janaillac in respect
of the 2017 financial year, in his capacity as Chairman
and Chief Executive Officer
9th resolution: Approval of the elements
of the compensation policy for the Chairman
and Chief Executive Officer
10th resolution: Setting of the amount of directors’ fees
11th resolution: Authorization to be granted to the Board
of Directors to carry out transactions involving
the Company’s shares
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8
A I R F R A N C E - K L M
RESOLUTIONS SUBMITTED TO THE SHAREHOLDERS’ MEETING -EXTRAORDINARY BUSINESS
5
12th resolution: Increase in the total nominal cap
amount foreseen in the 12th resolution of the
Shareholders’ Meeting of May 16, 2017 to set this cap
amount at €214 million (i.e., given the amount already
used, an available cap of around €139 million)
13th resolution: Delegation of authority to be granted
to the Board of Directors for a 14-month period,
to carry out capital increases reserved to members
of a company or Group savings scheme without
shareholders’ preferential subscription rights
within a limit of 2% of the share capital
14th resolution: Powers to accomplish formalities
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8
A I R F R A N C E - K L MDUBROVNIK
2017FINANCIAL RESULTS
A I R F R A N C E - K L M
2017: STRONG OPERATING RESULT
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 7
2017 2016
Revenues (€bn) 25.78 24.84
EBITDA (€bn) 3.2 2.7
Operating result (€m) 1,488 1,049
Net result, group share (€m) -274 792
Operating free cash flow (€m) 696 347
Net debt (€bn) 1.66 3.66
A I R F R A N C E - K L M
STRENGTHENING OF THE FINANCIAL STRUCTURE
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 8
€bn
OPERATING
CASH FLOW LEASE ADJUSTED OPERATING
RESULT
DEBT / EBITDAR
€bn
2011
Strike adjusted
-0.1
0.0
0.4
0.6
1.1
1.4
1.9
2012 2013 2014 2015 2016 2017
0.9 0.9
1.5 1.5
1.9
2.2
2.9
2011 2012 2013 2014 2015 2016 2017
5.75.4
4.24.0
3.4
2.9
2.1
dec
2011
dec
2012
dec
2013
dec
2014
dec
2015
dec
2016
dec
2017
A I R F R A N C E - K L M
IMPROVED OPERATING RESULTDRIVEN BY UNIT REVENUE PERFORMANCE
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 9
2017
-119
Currency
impact
1,488
Unit
revenue
1,049
Others2016 Fuel price
ex-currency
In €m
+101+447
+10
A I R F R A N C E - K L M
DECREASE IN UNIT COST EXCLUDING PROFIT SHARINGAND LOAD FACTOR EFFECTS
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 10
UNIT COST EVOLUTION
Reported change Change ex-currency
and fuel price
Load factor effect Profit sharing effect Adjusted change
-1.0%
-0.8%
-0.3%+0.3%
-0.2%
A I R F R A N C E - K L M
NETWORK: GROWTH IN TRAFFIC AND UNIT REVENUE
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 11
UNIT REVENUE EVOLUTIONACTIVITY
83.9 million Passengers in 2017
Employees:
54,000
Aircraft in operation:
471
Revenues: €22.48 bn, up 3.4%
Operating income increasing by €379 m
TotalEconomy ClassPremium Classes
AT CONSTANT CURRENCY
2016 2017
86.8%
+2.6%
+4.3%
85.4%
Load factorTraffic Capacity
2.1%
3.7%
1.5%
-0.5%
1.2%
3.7%
5.1%
-1.7%
5.2%
8.4% 9.0%
2.7%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
A I R F R A N C E - K L M
NETWORK: CARGO TURNAROUND CONFIRMATION
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 12
1.14 million
ACTIVITY
Full Freighter activity shows improved performance
Traffic and Unit Revenue up
> Market demand growth to and from Asia and Latin America
Tons Cargo in 2017
Employees:
4,300
6 full freighters
in operation2016 2017
59.9%
+0.9%
+1.8%
59.3%
Load factorTraffic Capacity
A I R F R A N C E - K L M
TRANSAVIA ACCELERATED GROWTH
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 13
14.8 millionPassengers in 2017
Employees:
2,900
Revenues:
€1.4 bn
Operating result:
€81 m
Unit revenue rise (+6.8%)
More than 100 Transavia destinations
Low cost n°1 in the Netherlands and Paris-Orly
ACTIVITY PASSENGERS
In millions
2016 2017
90.6%
+10.5%
+12.2%
89.2%
Load factorTraffic Capacity
6.37.6
8.99.9
10.8
13.814.8
2011 2012 2013 2014 2015 2016 2017
+135%
A I R F R A N C E - K L M
A WORLD LEADER IN MAINTENANCE
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 14
World leader
Employees:
13,600
15 industrial sites
450 engine shop visits per year
1,300 aircraft under component
support contracts
Revenues:
€4.2 bn
Operating result:
€215 m
THIRD PARTY REVENUE
AND OPERATING RESULTORDER BOOK
In €m
Slight margin pressure, due to strong competitive landscape in the Component activity
Further increase in order book
> New Component contracts on new-generation aircraft
> New Engine deals
In $bn
31 Dec 2015 31 Dec 2016 31 Dec 2017
1,0961,225 1,251
1,577
1,834 1,823
2012 2013 2014 2015 2016 2017
145159
174
214238
215
8.4 8.9
10.4
+16.9%
+6.0%
A I R F R A N C E - K L M
HIGHLIGHTS OF THE FIRST QUARTER 2018
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 15
Fairly positive business environmentin line with expectations :
> 22 million passengers carried, up 5.2%
> load factor at 87.1%, improvement
by 1.7pt
First quarter operating income(1)
at -118 million euros, a decrease of 85 million euros compared to last year:
> Air France strike impact
> improvement of KLM and Transavia
performance
(1) Since January 1, 2018, implementation of new accounting standards of IFRS 9, 15 and 16.
A I R F R A N C E - K L M
AIR FRANCE-KLM SHARE PRICE
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 16
Air France-KLM
CAC40
Stoxx Europe 600 Travel & Leisure
+45%
+8%
+14%
2017 2018
14 May 2018BASE 100 AT 1ST of JANUARY 2017
A I R F R A N C E - K L M
AN ACTIVE COMMUNICATIONTOWARDS INDIVIDUAL SHAREHOLDERS
Shareholders’ letters available on internet
Individual shareholders’ Club and Committe
Shareholders’ meetings in the French regions
A multiple award-winning communication in 2017:
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 17
Award of the best
SBF 120 digital
communication
assigned by Le Revenu
magazine
Award of the SBF 80
Grand Prix for the
Annual General
Meeting 2017 assigned
by l’Institut du Capitalisme
Responsable
December 2017 July 2017
CHINESE TAIPEI
TRUST TOGETHERACHIEVEMENTS AND CHALLENGES FOR AF–KLM
AJACCIO
STATUTORYAUDITORSREPORT
A I R F R A N C E - K L M
STATUTORY AUDITORS’ REPORTS
As regards the Ordinary Shareholders’ Meeting
> Reports on the financial statements
• Consolidated financial statements
• Annual financial statements
> Report on regulated agreements and commitments
As regards the Extraordinary Shareholders’ Meeting
> 2 reports related to capital operations
20S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8
A I R F R A N C E - K L M
REPORTS ON THE FINANCIAL STATEMENTS
Consolidatedfinancial statements(pages 287 to 292of the 2017 Registration Document)
21
Annual financialstatements(pages 307 to 309 of the 2017 Registration Document)
Unqualified opinion on the fair presentation and consistency of the financial statements (consolidated and annual financial statements)
Key audit matters:
> Revenue recognition for issued but unused passenger tickets
> Measurement of retirement and other long-term benefits
> Recognition of deferred tax assets
> Provisions for litigations and contingent liabilities (consolidated and annual financial statements)
> Valuation of equity interests (annual financial statements)
Specific verifications
> No observations on the information given in the management report and consistency of the information
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8
A I R F R A N C E - K L M
SPECIAL REPORT
On regulated agreements and commitments(page 310 of the 2017 Registration Document)
22
Authorization during the year and since the closing
> No new agreement or commitment authorizedduring the year
Approval in prior years
> No agreement or commitment authorized in prior years that remained in force during the year
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8
A I R F R A N C E - K L M
REPORTS IN RELATION WITH THE EXTRAORDINARY SHAREHOLDERS’ MEETING (1/2)
On the amendment to the maximum nominal amount of share capital increases (12th Resolution)
23
Purpose
> Proposed amendment to the maximum nominal amount
of share capital increases likely to be carried out,
immediately or in the future, from €150 million
to €214 million, under the delegation of authority voted
by the Combined Shareholders’ Meeting of May 16, 2017
Procedures performed by the Statutory Auditors
> Verification of the content of the Board of Directors’
report related to this operation
Conclusion
> No comments to make on the proposed amendment
to the maximum nominal amount
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8
A I R F R A N C E - K L M
REPORTS IN RELATION WITH THE EXTRAORDINARY SHAREHOLDERS’ MEETING (2/2)
On the issuance of new shares or other securities granting rights to the share capital reserved for members of a company savings plan(13th Resolution)
24
Purpose> Delegation of authority to proceed with increases in the share capital
for a 14-month period and limited to 2% of the Company’s share capital
> Opinion on the fairness of the quantitative information, on the proposed
cancellation of preferential subscription rights and on other information
Procedures performed by the Statutory Auditors> Verification of the content of the Board of Directors’ report related
to this operation and of methods used to determine the issue price
of equity securities
Conclusion> Subject to subsequent review of the conditions of each equity issuance
decided, no comments to make on the methods used to determine
the issue price of equity securities
> No opinion on the price and on the proposed cancellation
of preferential subscription rights
> Additional report, where appropriate, when this delegation is used
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8
AMSTERDAM
GOVERNANCE
A I R F R A N C E - K L M
CURRENT COMPOSITION OF THE BOARD OF DIRECTORS
A S S E M B L É E G É N É R A L E – 1 5 M A I 2 0 1 8 26
Jean-Dominique
COMOLLI
Isabelle
BOUILLOT*
* Including 8 independant Board directors as defined by the AFEP-MEDEF Code.
Changes in the composition of the Board
Jean-Marc
JANAILLAC
Maryse
AULAGNON*
Karim
BELABBAS
Leni
BOEREN*
Mathi
BOUTS
Anne-Marie
COUDERC*
DELTA AIR LINES, INC.
Represented by
George MATTSON
Hans N. J.
SMITSIsabelle
PARIZE*
Jaap
DE HOOP
SCHEFFER*
Anne-Marie
IDRAC*
Louis
JOBARD
Solenne
LEPAGE
François
ROBARDET
Bing
TANG
Alexander R.
WYNAENDTS*
Patrick
VIEU
> November 2, 2017 : appointment of a woman independent Board director
> October 3, 2017 : Delta Air Lines and China Eastern Airlines join the Board of Directors
> October 10, 2017 : appointment of a second Board director representing the employees
A I R F R A N C E - K L M
BALANCES WITHIN THE BOARD
A S S E M B L É E G É N É R A L E – 1 5 M A I 2 0 1 8 27
A Board of Directors composed of 19 Board directors:
53 %
independent
Board directors
4 nationalities:French, Dutch, US, Chinese
41,2 % women
Robust competencies at
the service of the business:
Industry, Service, Transport,
Air Transportation,Tourism,
Finance, General Management,
Governance, International
Shareholders representatives:
L’État français, Delta Air Lines Inc.,
China Eastern Airlines
2 representativesof the employee shareholders and2 representatives of the employees
A I R F R A N C E - K L M
MAIN MATTERS REVIEWED DURING THE 2017 FINANCIAL YEAR
28
2017 Shareholders’ Meeting
2017 Highlights11 meetings in 2017(attendance rate: 90%)
MAY
Joint-meeting of the Air France – KLM and Delta Air Lines, inc. Board of DirectorsJUNE
Shareholders’ Meeting authorizing the entry of Delta Air Lines and China Eastern Airlines into the share capital
SEPTEMBER
2-day seminar devoted to the Group’s strategyOCTOBER
Since the beginning of 2018
Debate on the conclusions of the evaluation of the BoardMARCH
2018 Shareholders’ MeetingMAY
The Board of Directors focused in particular on the following matters:
> Monitoring of the Trust Together strategic project
> Update on flight safety
> Reinforcement of the partnerships with
(i) and and
(ii)
> Unveiling of the new airline
> Partnership with
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 2 0 1 8
A I R F R A N C E - K L M
CURRENT COMPOSITION OF THE BOARD’S COMMITTEES
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 29
100% of the Committees chaired by independent Board directors
Audit Committee
Maryse AULAGNON
(Chair)
Leni M.T. BOEREN
Solenne LEPAGE
Anne-Marie COUDERC
François ROBARDET
Louis JOBARD
5 meetings in 2017(attendance rate: 93%)
Remuneration Committee
Jaap DE HOOP SCHEFFER (Chair)
Isabelle BOUILLOT
Jean-Dominique COMOLLI
Hans SMITS
Isabelle PARIZE
François ROBARDET
3 meetings in 2017(attendance rate: 89%)
Appointments and governanceCommittee
Anne-Marie COUDERC(Chair)
Jean-Dominique COMOLLI
Alexander R. WYNAENDTS
7 meetings in 2017(attendance rate: 100%)
A I R F R A N C E - K L M
MR. MATHI BOUTS, BOARD DIRECTOR REPRESENTING THE EMPLOYEES
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 30
BOARD DIRECTOR
REPRESENTING THE EMPLOYEES
Senior Purser on KLM long-haul flights
Chair of the Dutch Foundation MNO (stichting MultiNationale
Ondernemingsradenoverleg), a network of works councils
in multinationals
Appointed by Air France-KLM’s European Works Council on October 10,
2017 as a Board director representing the employees
A I R F R A N C E - K L M
RATIFICATION OF THE CO-OPTING OF MS. ANNE-MARIE IDRACAS A BOARD DIRECTOR (RESOLUTION 4)
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 31
INDEPENDENT BOARD DIRECTOR
Member of the Board of Directors of Bouygues*
Member of the Board of Directors of Saint-Gobain*
Member of the Board of Directors of Total*
President of the Aéroport de Toulouse-Blagnac Supervisory Board
(mandate expiring in May 2018)
Company Board director
* Listed company.
A I R F R A N C E - K L M
RE-APPOINTMENT OF ISABELLE PARIZE AS A BOARD DIRECTOR (RESOLUTION 5)
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 32
Member of the Remuneration Committee of Air France-KLM
Member of the Board of Directors of Auchan
Associate of Odys SPRL, Belgium
Counsel to companies, start-ups and private equity funds
INDEPENDENT BOARD DIRECTOR
A I R F R A N C E - K L M
APPOINTMENT OF MR. FRANÇOIS ROBARDET AS A BOARD DIRECTOR REPRESENTING THE EMPLOYEE SHAREHOLDERS FOR A 4-YEAR TERM (RESOLUTION 6)
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 33
BOARD DIRECTOR REPRESENTING THE EMPLOYEE
SHAREHOLDERS (GROUND STAFF AND CABIN CREW
SHAREHOLDER CATEGORY)
Air France executive
Titular member (elected) of the Supervisory Board of the Aeropelican
employee shareholder FCPE
Titular member (elected) of the Supervisory Board of the Horizon-
Épargne Actions diversified savings fund
Manager of SCI Arcole 3
A I R F R A N C E - K L M
APPOINTMENT OF MR. PAUL FARGES AS A BOARD DIRECTOR REPRESENTING THE EMPLOYEE SHAREHOLDERS FOR A 4-YEAR TERM (RESOLUTION 7)
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 34
BOARD DIRECTOR REPRESENTING THE EMPLOYEE
SHAREHOLDERS (FLIGHT DECK CREW SHAREHOLDER
CATEGORY)
Air France airline pilot instructor
A320 Flight Captain from 2007 to 2017
Pilot Officer on the B-737 until 2001, then on the B-747 from 2001 to 2007
A I R F R A N C E - K L M
ELEMENTS OF THE 2017 COMPENSATION FOR THE CHAIRMANAND CHIEF EXECUTIVE OFFICER (RESOLUTION 8)
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 35
2017 VARIABLE
€510,000
Quantitative performance
Qualitative performance
COI(Current Operating Income)
Adjustednet debt
New strategicplan and reduction
in unit costs
Successof the new alliances
Efficiency of governance
Achieved (87%) 48% 10% 11% 10% 8%
Target (80%) 40% 8% 16% 8% 8%
Maximum (100%) 50% 10% 20% 10% 10%
2017 FIXED
€600,000 > Unchanged since 2010
> Mr. Janaillac waived a portion of his variable compensation for 2017
> Performance criteriaaligned with the strategy
A I R F R A N C E - K L M
Elements composing the compensation of the Chairman and Chief Executive Officer
ELEMENTS OF THE 2018 COMPENSATION POLICY FOR THE CHAIRMAN AND CHIEF EXECUTIVE OFFICER (RESOLUTION 9) (1/3)
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 36
2018 FIXED
€600,000
2018 VARIABLEAnnual
Variable
OVERALL 2018
CEILING
€1,200,000
Long-term
Incentive
> Overall ceiling identical to 2017
> Unchanged fixed compensation for the last 8 years
> Pro rata temporis compensation
> No other commitments with respect to the Chairman and Chief Executive Officer, in particular no non-compete clause or severancepayment in the event of departure
A I R F R A N C E - K L M
ELEMENTS OF THE 2018 COMPENSATION POLICY FOR THE CHAIRMAN AND CHIEF EXECUTIVE OFFICER (RESOLUTION 9) (2/3)
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 37
2018 VARIABLE
Annual variable (annual)
Quantitative performance
Qualitative performance
COI(Current Operating Income)
Adjusted net
debt
New strategic plan and
reduction in unit costs
Success of the
new alliances
Efficiency of
governance
Target (70%)
35% 7% 12% 6% 10%
Maximum (100%)
50% 10% 17% 9% 14%
> Performance criteria aligned with the strategy
> Target amount: 70% of the fixed compensation
> Maximum amount : 100% of the fixedcompensation
A I R F R A N C E - K L M
ELEMENTS OF THE 2018 COMPENSATION POLICY FOR THE CHAIRMAN AND CHIEF EXECUTIVE OFFICER (RESOLUTION 9) (3/3)
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 38
> Granting of phantom sharesis subject to a presencecondition and to performance criteria over a three-yearvesting period
> Maximum amount: 10% of the fixedcompensation, i.e. €60,000
2018 VARIABLE
Long-term incentive
TSR on AFKLM shares vs. the
weighted TSR on the shares of othersector companies(1)
Actual AFKLMROCE vs. Budget(2)
Dow Jones Sustainability Index
Environmentalcommitments and CSR performance
targets(3)
30% 40% 15% 15%
(1) Defined as the performance of the Air France-KLM share price in any financial year relative to the performance of the sector: Lufthansa (40%), IAG (35%), Ryanair (12.5%), Easyjet (12.5%).
(2) Calculation based on absolute ROCE. The same correction for fuel will be applied as stated under the collective short-term incentive target.
(3) The evaluation of the criterion will be over a three-year period based on indicators reviewed annually by the Board of Directors.
A I R F R A N C E - K L M
Elements composing the compensation of the Chairman and Chief Executive Officer
ELEMENTS OF THE 2018 COMPENSATION POLICY FOR THE CHAIRMAN AND CHIEF EXECUTIVE OFFICER (RESOLUTION 9) (1/3)
S H A R E H O L D E R S ’ M E E T I N G – M A Y 1 5 , 2 0 1 8 39
2018 FIXED
€600,000
2018 VARIABLEAnnual
Variable
OVERALL 2018
CEILING
€1,200,000
Long-term
Incentive
> Overall ceiling identical to 2017
> Unchanged fixed compensation for the last 8 years
> Pro rata temporis compensation
> No other commitments with respect to the Chairman and Chief Executive Officer, in particular no non-compete clause or severancepayment in the event of departure
SHAREHOLDERS’
MEETING
MAY 15, 2018