Air France-KLM has described its 2009-10 financial year as an “annus horribilis”.

Air France-KLM has described its 2009-10 financial year as “our annus horribilis” – a horrible year – revealing revenues down 15% and an operating loss of €1.8 billion (£1.5bn).

The losses have been attributed to the negative impact of fuel hedges, adverse weather conditions, and February’s air traffic control strike. In addition, the group had to contend with the crash of flight 447 Rio-Paris on 1 June last year.

Pierre-Henri Gourgeon, Chief Executive Officer, said: “2009-10 will go on record as our ‘annus horribilis’. The global economic crisis had a profound effect on the entire airline industry… We have launched a robust action plan, based on three pillars: controlling capacity and investments, adapting our business models in passenger and cargo, and strengthening our alliance and partnerships.

“These actions have started to bear fruit and will enable us to emerge from the crisis with a young fleet, a rejuvenated product offer, adapted to the needs of our customers, and a preserved financial position.”

The airline hopes to break-even for the 2010-11 financial year, subject to the cost generated by the shutdown of European airspaces over the Iceland volcano eruption.

This has seen the suspension of Air France-KLM activity for four days so far, and a following three days of limited scheduled service. The group estimates a revenue loss of €260m, with a €160m impact on operating result.

To control costs for this financial year, the group’s plans include a reduction in headcount and limiting capacity growth.