Air France-KLM SA (EPA:AF)

Investor Day 2019

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Nov 5, 2019

Good morning, ladies and gentlemen, and welcome to our Investor Day today. My name is Olivier Gal, and I am Head of Investor Relations for Air France Scale And Group. It is a great pleasure to see all of you in this meeting room today. Thanks for your interest. This event is also webcasted and I would like to give a warm welcome to do the few following us via the web. We held our last Investor Day almost 3 years ago, and a lot of things happened, in our group since that time. And today, today's investor day will be the opportunity our management team to set out the group strategic priorities and the financial trajectory to 2024. Bajamasmes, Chief Executive Officer of Air France KLM will start with our strategic plan and strategic priorities. It will be followed by Peter Albers, Chief Executive Officer of KLM and Anne Regay, Chief Executive Officer of Air France, will give you more insights of the implication in the airlines. And finally, Frederic Gauge, Chief Financial Officer, will conclude with the group financial outlook. And the financial implications for the years to come. The entire CEO committee will then be happy to answer your questions. And we will then invite you to spend more time with us and pursue the exchange around the buffet lunch. Last, the technical information for those you, who took headphones, the translation is provided from English to French on channel 1. And time performance being a major focus for us. Let's start without any further delay and, join me welcoming Mr. Bajan S. Smith CEO of Air France KLM to the stage. Ben, the floor is yours. Okay, Marcio Olivier. Margio to 302, a bavenue and not Welcome to our Investor Day. And welcome to our Investor Day here in Paris. It's great to see some familiar faces around the room. So as Olivier just said, we have a agenda. I'll start, followed by Peter, and then Anne and then Frederic and we'll try to stay on time to ensure that we leave plenty of opportunity for all of you to ask whatever questions that you may have. So I'm going to start out here with a very important message to our team, the team that I work with day in, day out. And those are the employees of Air France KLM and Transavia. The amount of work that I see day in, day out, the dedication, the passion, that I've witnessed since I arrived here 13 months ago was really very, very impressive. Those of you that, may fly on our aircraft take our flights, go through our airports. I'm sure you've noticed that the level of pride at our 3 brands is second to none. So I just want to start out here by thanking all Alfas Group employees. It is a pleasure to work with them. There are a few, up on the top here just at the back of the, of the of the theater here and there were a few when we came in. And also which this is something I don't think we say often enough is me, personally, all of the senior management staff, truly, truly believe that our staff are the number one asset of this group. Okay. So we are in the customer service business. I think you've all know that. Our business revolves around our customers. Every day, we look to meet and exceed the expectations of our customers at each touchpoint So be it when customers are shopping on the web, checking in on our apps, making changes to their reservations, checking into the airport, checking a bag, boarding the airplane, all the different steps, all the different touch points that our customers come across when they are interacting with our brands. Our goal is to ensure that we meet and exceed those expectations. A lot of the investments that we're making currently and we plan to make going forward, are to ensure that against our competition, we are able to do this in a much more powerful and consistent way. So the new value focused model that we are working on is focused on now 4 main pillars starting out with employees, we want to ensure that we are the best place to work across all brands. Going to monitor this through our employee promoter score, which we do every day. In terms of customers, we do follow very closely our NPS our net promoter scores. And as I said, exceeding and meeting our customer expectations front and center. And with those two items, those two pillars being successful in those 2 pillars, this will drive new incremental shareholder value. We're looking for obviously strong improvements in the operating margin of our group and we want to reach and we believe we can reach top financial performance in this sector. Always looking and ensuring that our commitment to global environmental sustainability is also front and center. So therefore, it's obvious that, Alfon's KLM needs to reinvent in order to be successful we started to build a new value focused model around 5 pillars: optimize our current operating model reducing operating cost and increasing efficiency, taking full advantage of group sales, grow profitable passenger revenue, leveraging hubs focusing growth on the most profitable segments of our group assets, making sure that each of our brands come to life. Leverage European consolidation as an opportunity for our group but only when it makes sense financially and strategically. And beyond our passenger business, We have many other parts of our business, customer data, flying blue, cargo, engineering maintenance, which have a lot of opportunity to grow from a profit perspective. And of course, delivering everything that we do in a sustainable way, keeping and strengthening our leadership position as the airline group most committed to global environmental sustainability as evidenced. I'm not sure you're aware of this as evidenced by our first position ranking on the Dow Jones Sustainability Index. So here, the new value focused model will be progressively deployed over the coming years. So as we put in place the necessary foundation in order to reach our goals, that work will take part in the 1st few years of this journey. The more and more of these operational and these and these foundational elements are put in place. The opportunity to grow our profitable passenger revenue business will come into play. Always looking out for opportunities to leverage within the European market and always looking to develop our customer data flying blue cargo and engineering and maintenance business. And just going back to the top here, every single step, everything we do, commitment to global environmental sustainability is, front and center. Now, a lot of people ask us, you know, how does this come into play in our group? You know, our employees are I would say the group, the stakeholder that pushes to ensure that our responsibility are taken seriously, our employees want to make sure they're working in an industry that can be proud of, one that they can speak, to their friends, to their family and be secure that this is an industry that is responsible and that they have the number one ideas. It's amazing how many ideas we get from our 85,000 employees about what we can do as a brand in order to remain sustainable in a long term way and in an innovative way. So we have amazing assets. I think you're well aware of this. 3 very powerful brands. They all complement each other. KLM based in Amsterdam, El France here in Paris and we have 2 operating units for Transavia, 1 based in the Netherlands and 1 based here in plans. So throughout the group, we have 85,000 employees total, all very professional and engaged, as I mentioned earlier, We have 2 complimentary hubs, 2 complimentary global hubs, 1 in Amsterdam, 1 at OSE here in Paris. And we also have a very strong position at all the airport healing powers as well, which is severely causing flood constraint but we have over 50% of the slots there, which is a huge asset. We have very powerful partnerships, well demonstrated by our strong joint venture across the Atlantic with our partner Delta as well as our new partner Virgin Atlantic. And we have some very unique competitive advantages. France is the number one inbound destination in the world. So the number one inbound destination in the world. This is ahead of many other countries that even I, when I read this, this fact, I was surprised that France was ahead of many other countries that I would have expected to be in the 1st position, including the United States, Skippel, best in class European Hub, Skippel pioneered the international transit model over 50 years ago with the full alignment of the Dutch government Skippall Airport and KLM. This model has been replicated has been duplicated around the world. If Singapore Airlines was the first area that duplicated this, followed by many other cities and many other airlines. And you can see, 1 city 1 airline, that has taken this model and brought it up a level with a lot of to this is MR. It's in Dubai. And then we have a lot of joint teams that have been in place since fusion of the 2 carriers in 2003, one that really drives a competitive advantage are the commercial teams. We have both Amsterdam and Paris that ensure that the revenue production and quality that we have is as strong as possible. Okay. So here, a lot of work in the last year around simplifying our brands. If you go back to, this time last year, we had 5 brands within the group, our France KLM, June, Hop and Transavia, So we've moved forward to focus around 3 master brands ensuring that customers are clear about what is the value proposition of each one of these brands. So when our France serves to showcase the best of France around the world, France is one of the handful of countries which has its own unique brand and draws in people from around the world. Air Francis goal is to be able to leverage this as it flies the French flag around the world. The KLM brand is very powerful as well. We recently celebrated its 1 100th birthday. KLM is the oldest airline brand in the world. This global brand focuses on its strong Dutch identity with a history of innovation and we want to maintain the allure of KLM. For the next generation of travelers. Transavia is our low cost brand, both in France and the Netherlands and with our recently signed new agreement with the pilots of Dowrance. We now have an unbelievable opportunity to grow this brand in France. So our 3 airline brands have clear roadmaps to support the execution of the group's strategy in years to come. KLM will continue to develop its successful business model further growing as the best connection carrier to and from Europe. KLM will continue its focus on cost and operational excellence and leverage and evolve its global brand strength to remain 1st in customer choice. So, Alfrance, we have a lot of work to do here at Alfrance. We'll launch a strong transformation to fix its current broken model and increase its profitability by increasing operational efficiency, simplifying many of the complex processes that are currently in place, and pivoting towards the most profitable flows in order to extract maximum value from the Paris market. From the beginning as well, meeting and exceeding customer expectations every step of the way. Transavia, very, very powerful tool to address the price sensitive segment. With an extremely efficient low cost base. I mean, as I said, we have a long standing base in Amsterdam, and enormous new flexibility to grow the operation at Paris Orly and any other of the major French cities, throughout the country. So Air France and Transavia, we also have a major profitability issue at Paris Orley as well as the French domestic market So Transavia will help us better optimize our portfolio at Baldi. So let's start out here, just going into a little bit of further detail on KLM. And Peter will go into further detail when he presents right after me. So since 2014, a great number of initiatives that he put in place showing extremely strong results. So a high performance organization was put in place in 2014, a transformation of operations with digital increased agility, network planning and higher fleet utilization has shown big benefits The results are quite visible in KLM. The unit cost has come down approximately 4% since 2013. And 2018 and operational efficiency has greatly improved. Going forward, effort will be focused on 5 pillars Again, Peter will go through these in more detail. Customer and product, network and fleet, operational excellence, people and organization, innovation and sustainability So here the we're well on our way to simplifying the fleet at KLM. So you can see here today at City Hopper, our regional arm at KLM. We have 49 aircraft in the fleet. As part of the Embraer family, both the 175 and the 190. The medium haul fleet is made up of the 737ng51 aircraft we have in the fleet. So three models, the 700, 800 and 900 And on the long haul, we have 5 different types of aircraft. We have the A330, 13 of those, both the 20300 series. We've got 14787s recently taken delivery of our first -ten. And on the 777s, we have the 200 ER as well as the 300 ER. At KLM because of the number of airplanes we have in both fleets, we're able to operate this fleet under a common pilot type rating. Now France, the balance that we have, I'll show you in a few slides, it's not the case today. And then we continue to have 10740sevens, both the 400 series Kombi and the 400 series all passenger aircraft. So for a total of 66 long haul aircraft. So moving forward, we'll be adding the new Embraer 195e2 to the fleet these aircraft will continue to be flown as one common pilot type rating. So, 1 cockpit, 7 37 fleet will evolve either to the MAX, when and if, were satisfied with the performance of that aircraft and or other aircraft that are available on the market, but we're definitely targeting to ensure that it remains one cockpit type. On the wide bodies, we 747s will be exiting the fleet in the short term and the A330 fleet will be exiting in the mid term. Which will leave one common, type pilot type rating 1 cockpit at KLM between the two aircraft types on the white body. So the 787 and the 777. So here at Skippel, this this is both a challenge and an opportunity. So first off, KLM will adapt fleet to this lock constraint situation, delivering short term growth through larger aircraft gauge. So showing there we have the 787-ten, the Embraer E2. 2nd, we'll plan through KLM to optimize Our revenue in this new capacity constrained environment, slot constraints, limit opportunities for new entrants, giving us the opportunity to bring in more quality, revenue. And third, we'll align with external stakeholders to enable future capacity growth at SkipAll beyond the current cap of 500,000 movements after 2020 to prepare future long term growth and create further value. So KLM has built a very powerful competitive advantage at Skippall Airport. First Amsterdam benefits from an ideal positioning to connect Northern Europe with Southern And Eastern Europe. 2nd KLM has built a very powerful hub tool in people with industry leading minimum connection times, 45 minutes, which enables fast and efficient connections on intra Europe and medium to medium to long haul connections. So moving forward, KLM will have to cope with skip all airport facing slot restrictions However, the aircraft movements have reached the current cap of 500,000, but we do have this opportunity to drive higher unit revenues within that this new reality. So the KLM brand, one of the first airline global brands. We all know how quickly markets can change and new entrants can disrupt previous industry leaders. We'll continue to invest in this powerful plan, which we're all very proud of and ensure that it is it continues to be well positioned for the next generation of travelers So we do have 100 years of success at KLM, and we definitely, will be doing everything we can to ensure KLM lasts another 100 years. So at El France, as I said, the model that we have in place at El France is not sustainable. It is broken. We have already started a major transformation. And we're doing this one step at a time and we're doing this with full alignment, with our social partners. So all of the staff at El Paso. So when I arrived here 13 months ago, this was priority number 1. How do we build and ensure we have a strong social contract in place at El France? So an enormous amount of work by many people at the group we put in place to ensure that we have new contracts, which give us the flexibility required to overhaul and transform Afras into a much more robust and competitive carrier. And this was done through the first overhaul of what was a very, very tough item in 2018, which those of you that are familiar with with French law, French labor law, it was a renewal of the NRO, which takes place every year. This was done in October last year and formed a positive base to be able to negotiate with all of the individual teams at El Paso, the pilots, the cabin crew and the ground staff. Happy to say that all of these agreements are now in place, which have unlocked an enormous amount of opportunity for Alfons, and I'll go through some of these in detail. And Anne will do the same in even greater detail in her presentation. And this is all being done in a step by step manner. Every step of the way we're ensuring we get full alignment with our social partners. Everybody understands the opportunity that the balance and benefit of each change is well understood. And we don't move forward until we're comfortable. So step by step, while we do have very challenging facilities to operate from in particular here at Waseem. So throughout all this effort, the last year, there has been a big focus on operational robustness. And we'll show some details and some metrics on how we can show you how that's taken place. And those of you that fly Afrance and inadequacy. I hope you're seeing some improvement in the on time performance as well as if you check bags and make connections in those two areas as well. And as I said, the cost transformation program is well underway with a lot more work to be done there. So how we move forward with the employees and our partnerships, definitely everything is being done on a win win basis. And we started this out last year by really pushing 4 key pillars: trust, respect, transparency and confidentiality. They found very straightforward, but we have basically started every single discussion that we've had with all of the unions, all of our employees at Air France with these 4 pillars. And these were 4 pillars had to be accepted and had to be signed off by everybody at each one of these negotiations before we would move forward. Confidentiality was a key element of this. When I arrived, the many of the things that were going on with Air France information that should have been kept inside of the group was being read in the newspapers. So our staff and many instances were getting their information from newspapers confidentiality was key so that we could have the necessary discussions to reach agreements on how we could evolve the FS business transparency. There was a 0 trust when I arrived with many of the teams at El France that had to be regained and earned in a respectful way. And by sharing as much information as possible in a confidential way, we're able to move very quickly, on this front. So one of the key examples of success that has come about the agreement with our pilots is which is not well known or known at all, I think, outside of El France has been the evolution of what is a place we call a production balance agreement, which there are several production balance agreements within the group But the one between the LFRAZ pilots and LFRAZ, the company has been extremely, extremely restrictive So it's based on 3 metrics capacity from an ASK perspective. I think you all know what an ASK is. The number of passenger lane airplane times the distance, the number of block hours. So all the flight hours that are flown long haul by, El France and the number of long haul aircraft. Number of so, number of aircraft, number of hours, the pilots care about how many hours airlines have because that drives jobs and then the capacity. So it makes sense when you're comparing block hours and number of aircraft between our airlines, but the ASK metric really has been holding Air France bag from optimally deciding which aircraft to buy and how to configure them on the inside. So this KPI has forced our flaws to make really punitive fleet and production decisions. So an example just started here with an example. So if you take a Paris Singapore or a Amsterdam, Singapore flight using the same aircraft type, so a 770seven-300ER, the same block time. We know maybe give or take a few minutes. The configuration that we use on KLM, 408 seats on the aircraft versus the 2 96 seat configuration we use at Air France with the larger business cabin and the first class La Puemielle cabin. You can see here on an ASK basis, LFAS is running 35 percent less ASKs and KLM. So in the previous production balance in place at LFAS, Elfghas would be on-site in terms of block hours, on-site number of aircraft, the same number of aircraft here. It takes about 1.25 aircraft to operate that route. But in terms of the capacity off-site, so to maintain, being on-site on that metric, either have to configure the airplanes in a way that are optimal for the Paris market or by aircraft such as the A380, that may drive larger ASKs to balance it out. So not optimal. So what we've been able to achieve and this flexibility has solidify what pilots really care about, which is the number of hours and the size of aircraft that drives their pay. So the ASK metric has been replaced by a new KPI, which is based on maximum seating capacity of an aircraft. So with the certified maximum capacity of a 7 77 is five hundred seats as an example, it doesn't matter now whether we configure F France with two ninety six seats or four zero eight seats from this, from this angle now from the production balance agreement, We've now evolved this to something much more flexible and this is a huge, huge win from a revenue quality, from really designing, the interiors be optimal for the unique Paris market. This was necessary. The agreement that we now have in place the new agreement we have in place with the Efron's pilot also had lifted the restriction on the number of airplanes that can be operated by Tanzania, France, so Transavia France. Transavia France is the newer arm of Transavia. The brand was created and started in the Netherlands. And when it started here in France, going from 0 to 14 airplanes, that was the first set up. The first number that was the first set of numbers that could be introduced. Major strike at El Paso. When Transavia was positioned to grow to 40 airplanes, another major strike So, a huge win to be able to completely lift this cap in a win win basis on a win win basis with our pilots. We now have absolutely zero limit on, the number of aircraft that Transavia brands can operate. So this tool which is very cost effective against the low cost competitors here in Europe, we now have the opportunity to use this tool both defensively and offensively, with whatever number of airplanes we want to use. So here, another example of how the previous, very, very constrained production balance rule, what it did to, decisions. If you look here in 2014, before the some of the new seats were put on one of our 777s, we had between 59.77 premium seats. So both lab cognial and business class, And when the reconfiguration on this aircraft type, a 777200ER was done in order to comply with the production balance to ensure that we were on-site had to reduce the number of premium seats down to 52 to 64 to ensure that this that the ASK metric was made because in the previous one, it didn't matter. A seat was a seat, even though a business class seat was producing more revenue. From a pure pilot agreement perspective, they were treated the same. And how that is negatively impacted? Now France, we can see here on the right, the long haul premium capacity in Paris has grown by 9% since 2014. So there's been a big increase in long haul premium capacity in Paris. And you can see here in large part because of these types of restrictive agreements, the El France long haul premium capacity has gone down 4%. So this the model of El France is positioned to gain as much of this traffic as possible. And we're just this is just one example of the restrictions that were in place where we cannot position the carrier. As best as possible. Oops. Just go back one slide please. Okay. So here, so we thought we had a complex fleet at KLM moving to a more simplified, you can see what we have. At El France. So we don't have every type of airplane, but we almost do. So, if you start out with the regional fleet here, so operated by HOP. So first off, we've done the rebranding. To ensure from a customer perspective, that it's the AlphaOS mother brand that comes first. So we've already made the decision to exit the ATRs That fleet has been shrinking quite rapidly. They should be out in the short term. We'll be exiting the Embraer 145s. And we will concentrate the HOP fleet with the CRJ-1000s and the Embraer 190s We are evaluating whether we keep the CRJ700s and the Embraer 170s as well. If we can come up with a cost structure and a route network where those airplanes can make sense. We'll keep those airplanes in the fleet. But either way, we'll go down from 4 cockpits to 2 cockpits at El France Hopd. On the medium haul side of the El France business, today we have a unified Airbus medium haul fleet, but with 4 different variants, so the 3 18, 3 19, 320,321, Eflon is the only area in the world that operates all 4 of the aircraft types. Some of them are bulk loaded. Some of them are containerized. Even though it's one aircraft type, it is complex. So that other that's but it is 1 it is 1 pilot cockpit, as I said. If you move down to the long haul, we have A330-200s, A340-300s, A350-900s, we got the first aircraft in. We're just received the second, 787-9s. We have 9 in the fleet. There's one more that will be delivered as part of the firm order. And then on the 777 side, we have 70 aircraft in the fleet. 2 of them are in an all cargo configuration and 68 on the passenger side. So both the 200ER and the 300ER then of course, we have 10 A380s. So we've already announced we will be removing the, A380s from the fleet. So those 380s will be out of the EFHOS fleet by 2022. And the A340300s will also be exiting the fleet in the short term. So if you move forward, we will be centering the fleet around 2 computes So the A330-two hundred, A350-nine hundred and depending on market availability, market demands and the environment, we will balance those 2 fleets out and we'll retire the A330-two 100s when it makes sense. But in the interim, we have a lot of efficiencies because those 2 fleets can be off it under a common pilot type rating. On the wide body side, we have, as I said, 10,787 dash 9s in the short term, and we saw the very large fleet of 777s. So the A350-nine seventy eight seven people ask us, does it make sense to operate both of those aircraft types? And especially if one of the fleet 787s are only at 10 aircraft We have a lot of flexibility here. We can look to move those aircraft to KLM in the future. 3 of those aircraft are on leases. And we could also look to put those out of the market if we want to exit them from the off cost fleet. Right now we are assuming they stay in the off cost fleet so that we have good leverage when we negotiate with Airbus in Boeing on the replacement of the A330 200s and some of the early model 777s that we can continue to have a choice of flying either sort of selecting either Airbus or Boeing, but we do not want to have more than 2 pilot type cockpits in the Afras long haul fleet. So that'll bring down the number of cockpits in Affas from 9 today and in a fully optimized fleet down to 5. So huge simplification here helps our operation manage the fleet helps our checking agents and our day of operation when we have to swap airplanes for the configurations. And of course, really helps out our maintenance teams with fewer aircraft types, fewer engine types. So it would be decision to replace, the A380s and to exit these airplanes sooner rather than later was a very, very tough decision, took a lot of analysis and a lot of involvement by many teams at El Fras. So even though it's only 10 airplanes in the El Fras fleet, They drive a lot of decisions and a lot of the makeup of the operation. A lot of the bank structures at or see are designed around the arrival and departure of, the flights that are operated by A380s because they have they're so big and they cannot depend on a large portion of local market. So this aircraft type is the benchmark is what drives the rest of the Air France fleet. So making a decision to pull these aircraft does give us more flexibility because we are going to replace them with smaller aircraft types with additional frequencies to further smooth out what's already a complex operation at Waseem. Today in the morning, for those of you that arrive on international flights into Chaldego, Waseem. We land or we have 60 to 70 wide body airplanes arriving in a 2 a half hour period, which puts an enormous stress on the facility, even on a good weather day, And a lot of that, as I said, is driven by the need to have a strong hub in the morning for these A380s. Now there are 3 airlines that operate the A380s in Europe, British Airways, Lufthansa and Al Fras, British Airways and Lufthansa, have already renovated their interiors to ensure that they have competitive configurations, competitive products on the inside of those airplanes. Alfas had has not done that as of today. So we were at a point where we had to make a decision. Are we going to invest the necessary 1,000,000 to 1,000,000 to bring the interiors on these aircraft up to competitive standard. Today, they have a very old La Pwenael cabin. We have business class seats that are not wide flat. We don't have the latest inflight entertainment and these aircraft are flying on the most, lucrative and high profile routes in the Alfons network. So JFK, Los Angeles, San Francisco. So it did not have our best product and our key roots is really a discount to the brand. And really hold us back from showcasing the best of El France. This fleet is the poorest operating aircraft in the fleet We have enormous amounts of delays on this aircraft. This fleet has the highest rate of cancellations. And so getting these airplanes out sooner rather than later is going to help the operations at Avcross also set the airplane as very big. It gives us a much more flexibility. And on these new routes or on these bellwether routes where we operate them, more frequencies with the right product on board, are a big plus advantage for our customers. As you know, Airbus has also decided to discontinue the manufacturer of this aircraft type to putting into doubt the availability of parts both directly from Airbus and the supply chain. And this is a good time to buy long haul airplanes. The market for long haul airplanes is down. It's weak right now. So the timing for Air France. I hope that could be better. So we can get some true opportunistic prices for the aircraft we select to replace the A380. So the choice will either be the 787 or the A350. And we're hoping to make that decision, in the coming weeks. So here, just an example of the airplanes that have already been selected coming into the fleet. As you know, we placed a big landmark order for 60, Airbus A220 300s to replace the first half of our medium haul fleet at El France. So as you saw on the previous slide, we have 83eighteen's, nineteen's, twenty's, twenty one's. This 60 these 60 aircraft will replace the A-three eighteen's and A-three nineteen's. They're going to drive an approximate 1,300,000 EBITDA increase per aircraft to 1,000,000. And that'll total with the 60 aircraft, 1,000,000. Now If Airbus decides to build a Series 500, a larger model of 400, whatever they decide to call it, we will be very interested in that airplane. To replace some of our larger, Airbus narrow body aircrafts, such as the 320 or the 321. Of course, we could look to the neo for the second half of the replacement of our narrow bodies or we can look at whatever other aircraft is on the market. But this airplane we're very excited about It's a brand new airframe, brand new wing, the engines. Of course, I've got a few early issues, but this is not unlike many other engines that are coming to, into market. So we are really, really excited about the cost of operating these airplanes. The comfort that they have on board for customers, and the ability for us to use them much more profitably on all of our domestic and intra Europe, European flying. On the wide body side, we have 28 airplanes either in service or on order. Our calculations show a 1,000,000 improvement in EBITDA for each one split between the lower fuel burn and an optimized cabin. And that should drive an approximate million improvement once we have all 28 aircraft in the fleet. So here, another very important slide. So if you look today, this is the interior layout, Lopa, just for illustrative purposes, we're showing you the 787-nine at L France. So today, we have two seventy six seats on board that airplane. So we have thirty seats in the business class, so up there on the left. And then we've got 30 sorry, 21 in premium economy. And we have 225 in economy, a total of two seventy six seats. If you look at the industry leading configuration, so keeping constant, the number of business class seats with the same type of business class C, same with premium economy, by ensuring that the galleys are optimized, the toilets are in the best location. And we've been able to have this as an opportunity now with the new cabin crew agreement that has been put in place with our France, we can drive 9% more efficiency just with cabin configuration. We can add more business class feeds, add more premium economy class feeds if we want to choose the same ratio between premium economy, we could do that as well. But 9% more efficient just on the layout of the airplane. And then same thing here, Alfrance for a number of reasons, we do not have optimal utilization of both the medium haul fleet and the long haul fleet. You can see here within our group, we have a big difference between KLM and L France in terms of utilization. So obviously the cost of the airplane spread out over more hours and more seats does bring down the ownership cost up to 10% to 20%. Now why why is the Afcon's utilization, let's say, on the wide body fleet lower than at KLM? All the work that's been done by Peter and the team at KLM to ensure that the schedules have been optimized around driving utilization up have produced some huge benefits having a complex fleet has made it more difficult for El France to do so. Also, many of the schedules that El France operates we're looking to change. So we have airplanes that sit around the world on the LCAN side of the business in Johannesburg, in Sao Paulo, in, in Santiago and Singapore and Hong Kong, all these different areas where we flight ultimate optimal timing those of you that fund some of those routes, we fly overnight in both directions and we leave the airplane there all day. Some of the routes we need to do that for competitive reasons but numerous other routes, we don't need to do that. Just by bringing the airplane back and having it available to fly something else, that will boost the utilization rate at El France on the wide body side. On the narrow body side, because of the non optimal setup we've had with HOP and with Transavia to be able to ensure that we hold on to our slot portfolio at all lead, we have to make a lot of non optimal decisions on what time the FRAS narrow body fleet is operating. So this with the new flexibility that we have, with the ability to grow Transatium, ensure we have the right product at the right time. It gives us flexibility that should drive that number higher. And then we have something else which I get asked many times. What is the group? What are our views in terms of low cost long haul. Now we're still not convinced that this is a model that has a strong future. However, We do have a position today that enables us to maintain a strong market share on the big leisure markets in and out of Paris. So the largest market in head of Paris today is New York, but you'd be surprised at what number 2, 3, and 4 are. So number 2 is Pointe Pietre in Guadalupe. Number 3 is Layingau in the South the South, just around the southern part of Africa. And the third is Faldefrance in Miltonique. And we had numerous low cost carriers on those routes. So a decision was made a few years ago to densify 12 of the 40 3, 770seven-300ers into an extremely dense configuration to compete with the carriers on those routes. So you could see as a benchmark today, an A330200 from one of our competitors has 3.14 seats. With a non life flat seed in a premium. So basically not a business class, but a premium economy class and is driving a unit cost of approximately $0.05. The LCOS high density, 777, so the 12 aircraft that we have that are focused on those three high volume leisure markets, we can get about $0.05, the cast can go down to $0.05 as well. In addition, the RASK opportunity for our furnace is higher because of the opportunity to carry our existing customers that fly out for business reasons and may have more of a tendency to fly out for a leisure trip Now there, the Airbus A350-nine 101,000 are starting to enter the fleet to some of our leisure competitors. That will bring down the unit cost for those airlines by approximately $0.01. So here we have to make a decision does Air France maintain the current offering or do we look to do something else? So our current strategy is to maintain what we have. And based on what we've seen, Excel, like a lot of business here in France, Ed Lazyro, we believe that the strength of the long haul low cost carriers in France is not that strong and we do have a product that can keep us in that market for now. So this is, this is very important for the group operating in France. Operating an airline in France is not easy. We continue to lobby very, very strong for a more competitive environment for airlines here in France. So these are a few examples of what we're up against, operating in this country. So the difference in costs to operate between if you look at the a compare between Paris, Chaldegold and Skippel, It costs us 1,000,000 more to operate here in France and the facilities that are not as efficient and not as modern and we cannot get the same minimum connection times here in Paris as we can in Amsterdam. So that's a high, high cost to pay to operate here in Paris. And then there are other specific French taxes, really focus and only focus on the airline industry. So there was a civil aviation tax of $108,000,000. There's a solidarity tax that's imposed on airlines. That, from for Afros cost 62,000,000. There is an eco contribution tax, a new one starting in 2020, which will cost us 60,000,000 And we'll be contributing in the form of a tax of 1,000,000 to the new CTG Express, which should start in 2020 or 2025. And there are other unique, taxes focused on, targeting the, the aviation market here in France. And then of course, France has the highest social taxation in Europe, which the 50,000 employees that we have based here in France, the group is responsible for those. So ahead of Italy, ahead of Germany, ahead of the UK and, of course, ahead of the Netherlands. So moving on here to Transavia, as it's on the Dutch side, of of the brand. So the operation we have in Holland, we will remain the number one low cost care in the Netherlands. We'll invest where and where necessary and where it makes sense. We do obviously have slot constrained airports. There is the possibility of opportunities at Leilistad Airport. On the French side, as I mentioned earlier, we do now we do now have an incredible amount of opportunity and flexibility with a new pilot agreement that we have in place. So both to grow in the VFR markets the leisure markets, as well as the mixed markets that we compete against, Vueling, Easyjet, Ryanair, Volletier. And the other carriers that have those lower cost, cost models. And here, we're just announcing today later on this afternoon that we're going to open a new base in Montreal, 2 aircraft, that'll start in April 2020. And we have, in the room here, we have Nathalie Stugglow, who won't be presenting today, but she is the CEO of Tonsavia France, you can ask her all about that later on during the break. We also, are going to be strengthening the base that we have for Tanzania, France, in Nun, we'll be adding another 2 aircraft in 2019. So right now, we have 1 common cockpit across both operations, and we're using the 7 37 NG. So we have the 800 model both operations and we also had the 700 model, in service, in the Netherlands. So this fleet will grow obviously with the new flexibility that we have in France. We're evaluating, where and, where we can grow what makes more sense, both strategically, and economically and how do we balance that out, with the opportunities we have at KLM and L France. But this is a we're really excited about this. To grow from the maximum capacity of 40 airplanes up to whatever number we want, being able to balance out all being able to develop a much stronger position in markets, secondary markets in France where today we have a very limited position So, Bordeaux, not Toulouse, Marseille, Liz, Lyon, these are all important markets to Alfrance, And up until now, we had limited tools to be able to address all segments, all sectors of the market. So we have many I'll just move on here to what we have in place at the group. So to see, we've gone through KLM, gone through Alfras, gone through TAS Avia, each one of these business units, contribute an enormous amount of value to the group. The commercial side of the business, the IT side of the business, the cargo side of the business We had enormous efficiencies in place and we're going to continue to drive further efficiencies on these fronts. So commercial distribution and alliances, IT efficiency is extremely strong. I'll go through engineering and maintenance and cargo in just a few slides here. Moving forward, we want to put additional focus on these in these areas, fleet and network. We already do spend some time coordinating free purchases between the 3 brands. We believe we can do a even better job on that front. The networks, we do have good coordination between, our major airlines, our brands today, as an example, you know, some of our destinations where we don't fly daily, with, let's say KLM or France, we try to ensure that the, the non daily flights are complimentary. So San Jose is a good example where we fly four times a week with Alfaust, three times a week with KLM that we operate on consecutive days so that customers have a choice over one of our hubs to be able to get there on a daily basis. So commercial alliances, this will be strengthened human resources. We have now a new head of human resources at the group level Janet Deckers. She's here. In the second row. This position was vacant. When I arrived here, we want to ensure that our talent can flow across the group, because today it's a little cumbersome to move somebody from the Netherlands to France for all kinds of reasons and vice versa. And this is one example of something that we believe we've got some opportunity for improvement and for value. Purchasing and procurement, a lot of this is done already on a group basis, but we believe we can get more value out of this. And with the growing importance of customer data as well as digital, this will, take on a stronger role at the group level. So here, now moving on to the revenue side of the business, this all these foundation and items that I've just described and a lot of the changes have gone on with, with the union contracts that have evolved we're going to show you what we want to do with that, moving forward to produce more revenue and more profit. So over many years, you know, Alfons and KLM that built up fantastic hubs both in Amsterdam and in Paris. And they compete and are of similar size or even greater size than the 2 other, main hubs in Europe both at Heathrow and at Frankfurt. So today, in Amsterdam, we KLM, we link 171 global destinations, operating 3.47 flights a day, in Paris at both airports, if you combine the 2 of them, Oasi Shaldegold and Ali. We serve 194 destinations around the world and 444 frequencies per day. And you could see how that compares with British Airways, at London and Lufthansa at Frankfurt. So the dual hub model is really powerful when you put the 2 together. So this slide is extremely, important. This is probably one of the most important ones that I'll show you today. So if you see here the, the description or the box on the left hand side, it shows the current strengths of each of the segments that we fly in both airlines. So starting with KLM, we are profitable, on the majority of not almost all of the segments. That are in the KLM KLM portfolio. So on a local basis, so customers starting or ending their trips in Amsterdam, both medium haul and long haul, premium and economy, we are profitable customers connecting over medium haul premium. We are profitable. So we're going, let's say, from Dublin via Amsterdam to Milan, were profitable on those premium connections. In the medium haul, we do have trouble at KLM, in the economy cabin on the connection basis, but on a local basis, were okay. If you look at the long haul network, we're profitable KLM, all four of these segment types. It's a very strong base to grow from. Now, of course, there's nothing in domestic because we don't operate a domestic market. In the Netherlands. Now if you move over here on the Elfa side, the biggest money losing part of the business is the domestic economy market economy segment where we lose approximately 1,000,000 a year. This will be addressed, through the optimization of Ali. This is the center of the domestic market. So Economy class is, is a major, major folk for us, in France. Now if you're flying premium out of a domestic city, let's say, to lose to Paris to Tokyo, in business class, we do make money on those types of roofs. So the one area, in the domestic market where we are profitable on a connection basis in the premium cabin. Medium hall, you can see we lose money on a local basis in that of Paris. We lose money on flights that flow over, Paris. We do make money, however, on a local basis, on the European and short haul into and out of Paris and on a connection basis within Europe or okay there as well. Long haul, You can see here we do well. All three of the segment types. However, in the economy cabin, when we connect long haul customers. So let's say from San Francisco via Paris to Bangalore as an example here, we do not make any money. So if you look at the old model, so that example, we go back to the evolution of the production balance that was in place at El France. And one of the benefits of the evolution of that, that deal shows that we, we can move our exposure from the areas where El France does not make money and ensure that we have as much exposure as possible to the markets with the segment flows where we do make money on the Air France side of the business. We do have the Paris market, which we underperform in, which is, as I said, is the number one inbound tourist market in, in the world. It is a very large premium market as well. And by redesigning the OLE strategy, you look at those from a revenue quality perspective and a profitably perspective, all of the flex all of the restrictions that we had in place from a pilot and a cabin crew perspective haven't been cleaned up, have been, severely or extremely reduced in terms of flexibility. And this is, this is necessary to be able to start to pivot the Alfrance capacity to the areas in which it makes where it makes money. So as an example, so here, as I said, France is the number one inbound market. You can see ahead of Spain, ahead of the United States, ahead of Italy and ahead of the United Kingdom. And it's highly concentrated, around Paris So you can see it's 8 times larger than the next, inbound city, which is nice. And then if you look forward for 2020, France, is targeting 100,000,000 foreign tourists. So the market is expanding. Now this slide also very important. This year, we've divided into 3 different types of airlines. If we start with the left, these are strong connecting airlines. So Delta Airlines, our partner, has the largest hub in the world at Atlanta, which is the busiest airport in the world. From a small population base, the city of Atlanta is relatively smaller and much, much smaller than, than Paris, but it drives a lot of connections, a lot of domestic connections, a lot of international connections. As you know, Delta is the most profitable airline in the world and they've positioned their hub in Atlanta around where they have their strengths. Lufthansa, same thing Frankfurt is not as not a large of a home market as Paris. And they have optimized around this kind of split, 32% local 68% of their capacity is focused on transfer traffic. Emirates is also a similar split and what we have within the group We have an optimized split of 40%, 60% and works very well in Amsterdam. As we saw, the profitability that's driven from those types of flows and segments, produce this lid. If you look in the middle here, we have airlines that are benefiting from mixed local and connection traffic flows. So Cathay Pacific, Turkish Airlines and El France. So the market in Paris is so large, our study showed that we are not optimal, operated 49% connections versus 51% local. Why haven't we been able to change this? Numerous reasons, in particular, the restrictive pilot agreement that was in place. So here from many people, why is it that Alfrasse put out a 2% increase in wages last year and 2% this year, it pales in comparison to the opportunities that we have on the revenue production side with the flexibility is now offered by those agreements. So here, just one example, one percentage point of local market share, is equivalent to approximately 1,000,000 in incremental profit. Now moving that line, it's not happened overnight. We've got to compete again, some very strong carriers to gain that market share, but it's extremely valuable. And if you look British Airways, one that in Paris and not identical markets, I'll the business component, in London is larger, but British Airways had a similar split many years back and made the decision to significantly reduce the number of connection customers and move to its most profitable segments. And as you know, British Airways, the Heathrow hub is the most profitable hub in of any of the legacy carriers in Europe. So we are going to move from 49% connections of 49% local, 1 percentage point at a time to somewhere in between 50% 60%. We're not quite sure what's more yet, but it's definitely higher than 49%. And then here again, so that's from a connection angle. Now if you look, from a premium segment, angle, you can see here in 2014, the long haul premium seat capacity and how it has how the Air France market share has gone from 58% to 54%. So our market share significantly reduced. Why is that? In large part because of the restrictive, contracts we had in place. And here again, if we can increase 1 percentage point, the market share increase will drive approximately 1,000,000 incremental, 1,000,000 incremental operating profit. So as I said, I can't put enough emphasis on how valuable this new flexibility we have with our pilot agreements. So it's both this production balance will which will help us on the split between local and, origin with local and connection customers as well as ensuring we have the right cabin mix between, premium feeds and economy seeds. So I've been asked by many people and there have been comments in the press is Alfrance going to become the premium A airline versus KLM, the B airline will absolutely not. What I think you see here is that the opportunity to leverage the different market in Paris versus what we have flowing over Amsterdam is to ensure we optimize the size of aircraft and the size of the premium cabins at El France. So it's not to change the quality of service of the cabins. It's really to ensure that the size of the aircraft and the size of the cabins our position as best they can. So moving on now to our other businesses, So our non passenger businesses, so customer data, as I said, is is becoming more and more important. Our flying blue loyalty program, we have a lot of room to increase and ensure that that drives more value to the group. We have a strong cargo program, which contributes a lot of revenue and profit to the group. And of course, the strong engineering and maintenance maintenance division, maintenance group, which, was one of the best in the world. So here, we have a great opportunity to further leverage our toolkit as I said, we got a very powerful loyalty program. We flew over 100,000,000 customers last year, so we have a lot of data We're looking to better personalize our offer to provide more attractive customer value propositions at a lower cost of sale, you can see here our share of bookings through direct sales and NDC from 2017 are going from 40% to 40 7%. And you can see that's helped drive ancillary revenues up from 515,000,000 to an estimated $730,000,000 for this year. As you know, when you're able to drive the shopping experience direct to our channels, we can display our ancillary revenues in a much clear format. On the Flying Blue side, we have a solid foundation to grow. It's not new for us, loyalty programs. We're going to be introducing the sale of miles. Many, many new digital experience offers. Will come out and will really start to drive payment and miles for a new currency using flying blue miles. So engineering and maintenance, so as I just mentioned, we have built, up over many years a strong position and engineering maintenance forms a key part of our DNA at the group. Our margins remain strong and robust over the years. It's contributed very positively to the group operating results. And our order book grew by 36%. So from you can see here, from 2015 to 2019, 36% And we have leveraged the both the LCOS and KLM fleet, renewal to build a strong presence for the next generation products. So the Gen X LEAP has 2 examples. And we'll continue to do this with the A220 as we introduce that aircraft type. Alfast KLM Engineering And Maintenance, and, you know, already has a strong worldwide presence So we have built up an animal position in the fastest growing market Asia, which represents today about 41% of our sales, and this will help us feed long term growth. And building on our current success and our strong airline DNA our plan is to invest or further develop around 4 priorities 4 priorities in order to remain an industry leader. So with E and M, we're going to continue to focus on improving efficiency and operational performance. First for F Funds and KLM to have this, this group inside our group really helps drive the operational performance of both airlines We've got profitable growth opportunities, if I just showed you and we have a good history here over the last couple of years of showing how that we've been able to execute on that. Global footprint will focus on the strongest areas of growth. And we're going to fully leverage the digitization and artificial intelligence, which is now, becoming more and more relevant in this business, such as data analytics ensuring that we can take full advantage of predictive maintenance. So third cargo, the cargo division of, Alfons KLM of the group is extremely important. We had 6 freighters, 6 full full freighters in the fleet. We have 4747, 4747s based in Amsterdam. And we have 2 777 freighters based in Paris. We are the number 5 global carrier. So, you know, we're not a full cargo carrier. We are a big player. We have a 3.8% market share, around the world. And we have 135 trucking stations in place in terms of size of cargo hubs, Amsterdam and Paris are the number 2 and the number 3. And we have 130 plus direct intercontinental connections. So the network that we offer to our customers is extremely large. We have over 1000 weekly flown frequencies. Big revenue, more than $2,300,000,000 in revenue, over you know, a, a 1,000,000 freight tons that we have in here, a billion there, and 3800 full time employees are dedicated to this part of the business. So consolidation, as you know, there was an announcement yesterday, with Air Europa. So consolidation for us, obviously, very important. We're looking at this from a pragmatically, in public strategic financially conservative way. So we will play an active role when and where it does make sense for our group. Strid financial discipline is important. Some examples, the integration costs were higher than expected when Lufthansa needs a jet. Stated that, the integration of Airport Lane was much more expensive than planned. And this, we believe, weighs on their bottom line. A lot of bankruptcies, are, have taken place and are going to help consolidate the markets where those bankruptcies took place. And of course, consolidation, in Europe is not at the same level. As in the U. S. So I said when and where it does make financial sense, both strategically, and we believe from a culture perspective, we will look to move. Last but not least, definitely not not least. And both Anne and Peter will go into this in much more detail is our 5th pillar, which will embrace all our actions and that's commitment to sustainability. So put up one metric and I've already mentioned it, which we're very proud of And it's not, well known is that Alfrance KOM does have the number one position. So we've already done a lot of work around this. We have the number one position the Dow Jones Sustainability Index. So to conclude, I'll just go through here. So on the efforts that, we're working on to decrease our unit revenue, So an enormous amount of work, and as I hope you've seen with these 2, or 3 examples, the flexible labor contracts we now have in place at El France and the benefits it's providing to Transavia France have a huge benefit in decreasing unit costs that was getting the A380s out, number of aircraft configurations that we're going to pull. That's in the form of the simplified fleet. The savings that the next generation aircraft will provide, definitely bringing down unit cost with a more efficient domestic network. You'll see with the ATRs and the 145s and rare 145s coming out of HOP. Utilization will bring down, unit cost, the operational transformation with the A380s out you know, the operation will be much smoother at Waseem. KLM has already done an enormous amount of work on this and that will continue. Simplifying the organization. You know, Alfcross is a complicated, operation. It's a complicated, place to work. We have enormous talent at Alfrance. We are looking to ensure that the makeup of our teams on the management side evolved to be positioned for us to win KLM has started this has started this type of work a few years ago, continue to do that. And then of course, group synergies will drive savings as well. Group synergies will be embedded in all of the above unit cost initiatives that there are some unique extra ones that, will, will focus on, on their own. So on the, on the improvement on the revenue side, So pulling out the, the 2 unclear brands of Hop And June and focusing on the mother brand, Alfrance, will make this, LCOS brand the value proposition much, much clearer And we'll go through the work that we're doing to ensure that the the consistency of the products that we have in El France are well understood. The networks and the gauge, of course, with the new fleet, we further optimize the market positioning So with the flexibility that we now have with the pilot contracts, with the decision to clarify the brands, the key brands at El France, La Pramiell, business, premium economy and economy will be positioned to be best in class in particular on the premium side. The all these strategy with Transavia have an ability to grow there are definitely opportunities for high quality profit growth there. On the flying blue and digital side, you know, more personalization and driving more ancillary revenue, huge benefit Transavia growth, as I've already said, And then engineering and maintenance and cargo at both of the large brands, both of the large airlines, will drive, unit, unit revenue improvements. So the breakdown of where we're looking to get these improvements both on the cost side and on the revenue side. So the first part of the presentation, I went through what we're doing to optimize our operating model. So nothing would be possible without, this improvement that has been achieved through the commercial and fleet flexibility. So the internal and airline processes, we're targeting 400 $475,000,000 of improvement. The fleet will drive $400,000,000 to $450,000,000 of improvement. And $300,000,000 to $355,000,000 group synergies are embedded in the above, the above two numbers So for a total of 1,000,000 of improvement on optimizing our operating model. On the passenger revenue side of our go forward plan, clarifying the, the actual brands themselves and the portfolio and the offering. We're looking at $25,000,000 to $50,000,000 there. Ensuring that we pivot Alfrance to be able to participate in a greater way in its most profitable, markets will drive $200,000,000, at least $200,000,000 in incremental profit. And the growth of Transavia, we're being conservative here. Putting a $75,000,000 to $100,000,000 target. And then better leveraging the digital and the personalized travel, opportunities that we have with this huge database that are 100,000,000 passengers provide us will drive another 50,000,000. So we're not putting a number here for leveraging European consolidation. As I said, will continue to pragmatically evaluate, all of these opportunities. And then on our other non airline businesses, We're looking for Flying Blue, to generate $50,000,000 to $100,000,000, E and M, 50,000,000 and cargo we don't bring cargo out, to drive a continued positive contribution. So a total of 100 $150,000,000 contribution there. So the waterfall at the mid cycle we are targeting a 7% to 8% margin at the group. And that, of course, is taking into account, the, the high cost of operating in France. So we're not assuming, in this picture here that there's any change is that we're going to continue to lobby very hard. But, under the current environment, we are targeting a 7% to 8% margin in the mid cycle. $900,000,000 of that improvement is going to be assigned to improving the bottom line of Air France, $250,000,000 to KLM $100,000,000 to Transavia and then $100,000,000 to other synergies that we will drive amongst, throughout the group. So going from 4% to 7% to 8% in the mid cycle. This is our plan going forward. So thank you for your attention to this part and we'll now move on to Peter. Thank you Ben. Ladies and gentlemen, good morning, Bonsieur, Houdemore, Heiderein. I promise you these are the last words in Dutch out of here. Ben just took us through a lot of dynamics at the Bode Airlines and then myself will have the privilege to go one level deeper in this G we do at both Kaela and at Air France. Maybe it's good to have a little reflection on where we're coming from and what we did and what strategy for the past couple of years. And Ben just mentioned it already. We had the opportunity to celebrate on October 7, our 100th anniversary which was a very special moment indeed, not only for KLM, but actually for the country, and no one could have missed the festivities, which we did, and I'm very proud of the teams who organized everything and made sure that it was a wonderful success. A few words on the journey, we have sort of embarked and you'll see it back in the results and also reflecting on the steps we're taking forward, we have set a clear strategy back in 2014 where we made some very clear strategic choices. And when we speak about cargo later, I think one of the choices were in 2014, we still had a numerous full freighter aircraft. Today, we're down from 15 full freighter aircraft down to 4. We've made very clear choices what we do in the field of engineering and maintenance. So important for me that we make some clear choices and we move them into coherence way in execution. And in fact, these are 5 pillars you see here on the right hand side of the slide are the pillars we have year by year, by year, we have executed A lot of efforts here on the customer and the customer appreciation. I'll come back on that network and fleet. It's a very fundamental issue for any airline and Ben already mentioned quite a couple of things on the network and the fleet of Bode Air France and KLM. Let me go one level deeper operational excellence being the key and looking at the operational performance here, it's clearly a challenge at Skippel being more and more, more busy. Our people, clearly, are our brand and Ben mentioned the appreciation for our staff. And I would just like to underpin what we have been doing there and the appreciation for all the achievements made and last but not least, the pillar of innovation and sustainability, which is increasingly important in the world we operate and becomes really a license to operate. When it comes to sustainability. So in the execution, and I like it's not my own quote, but I use it sometimes to the annoyance of my team about every day. Strategy without execution is a hallucination So in fact, what we have been doing is put a lot of emphasis in the last couple of years on the execution of our plans And you find here on the left hand side, the exact same phrasing as Ben just mentioned in his slide and on the right part, you see how we're going to do that execution. So Left is the strategy and the choices right is the execution where we put a very clear targets and ambitions for all these various aspects in terms of what is our Net Promoter Score for our customers, what is our passenger fleet numbers and how are we going to make sure that our fleet will continue to be replaced by more modern aircraft operational excellence people in organization and innovation and sustainability. So very clear targets on every aspect, basically, of our journey there. So where do we stand now? And just for the benefit of having you in the room today, just share a little bit where the breakdown of the 11,000,000,000 of revenues on the KLM side is coming from roughly 70% of all our revenues at KLM is coming from our passenger business And then engineering and maintenance, cargo and Transavia are roughly counting each of them for 10%. Engineering and maintenance, there's always some double counting for internal work and external work, which really explains the fact that the numbers for those of you calculating very quick I would not expect anything different from this incredible audience. You'll find some double counting here on the engineering and maintenance numbers So roughly 11,000,000,000 of turnover, still a lot of business focus, but also leisure. And looking at the point of sale, and again, coming from a small country with a relatively small city, 1 out of 4 customers is Dutch 3 out of 4 customers is none does show our network is the core of what we're doing and making sure that we run the network as we do it. We've gone through some steps in terms of improving our operation margin. You see on the right hand side of the slide, an increase in the last few years from a 1.8% margin to a little over 10% or hoovering around 10% in 20172018. Which were clearly good years in terms of economic environment, fuel price and all the efforts which we have been doing. What's very important that the improvement had been matched by an increase in the level of investments we've been doing. And we have basically tripled our level of investments in the past years to a very large standing fleet, but also in digitization, also in our staff, but also very much in making sure that our customers have a great great experience. And for those of you traveling through Skippel, we have recently opened our new wide body lounge, our intercontinental lounge, I should say, It's a two floor lounge. It's a great a great asset for our customers and which Kipp will be congested, and I'll come back on that. It's really an asset in having a customer experience on that level there. So that has led to basically and Frederic will go into the consolidated numbers here to the net debt for EBITDA, which has gradually gone down from a level of 5 we still had in the range of 2012. To one 0.3 what it is today, clearly driven by a reduction on the net debt levels you see on the right hand side. Also, here you see the numbers in terms of operating margin where the year to date has been added. So these are the numbers which were released last week. In terms of performance. But having said that, we need to move forward and you saw invent a slight a breakdown at the very end of 250,000,000 of initiatives and actions and improvements to move forward. So we could break down this 250,000,000 by these sort of 3 brackets of foreseen improvement. The first one is continued cost focus and operational excellence. Again, we believe there are still opportunities in terms of cost reduction and improving our operational performance, we have launched a wide range of actions to use much more artificial intelligence I should say very sophisticated tool in order to manage our operations. Fleet renewal, a very important aspect, We have been phasing out gradually the seven foursevens. We had a total of 22. We're now down to a little under 10 And we have faced in the 787s first thirteen-ninety erin, and we have another 2-10s meanwhile. So we have 15 787s in operation. There's more to come. So the fleet renewal here is really helping for the remaining part our fleet renewal boats of the Embraer E2s, which will come in as from 'twenty one and a further continuation of investments in the 787 this year. Hence, And I'm very pleased with the steps which we have taken with un and Ben in the last year where we optimize the fleet allocation and basically made some optimization in the allocation between Air France and CalAmp helping Air France to step up the speed of the 350s and helping CalAmp to step up the speed of the introduction of the 787. So it's an important aspect and clearly also some revenue mix optimizations So these numbers are matching the numbers you saw here on Ben's presentation earlier in total adding 2 in the amount of 250,000,000 of initiatives to make sure that we continue to move forward. Few words here on digital, I'm incredibly proud of all the steps we've done in the field of digital in the last few years, clearly from a cost perspective but also very much from a customer perspective. And the fact that all our staff now has digital devices in order to make sure that our customers have a better experience and can be addressed right on the spot takes an incredibly important element and really helps us also to the revenue optimization in terms of personalization and more individual approach to our customers. Few words here on the key drivers and that basically the key drivers for our customers are setting the key priorities for our business It's at the end of the day, it's all about our customers and not so much about the the ways it means how we do it But when we look at the integrated approach we're having, we really continue to optimize that. And again, with the tight the tight situation that's Kippel, a optimal situation in terms of using our assets is extremely important and clearly schedule for us is the key driver being a hub carrier and the connection and the connectivity rates is the key driver of what we are doing. And we see that back in why people choose to fly on KLM and really helping us in moving forward. Customers I mentioned already a few times, we have stepped up really our efforts in terms of our Net Promoter Score on the left hand side of the slide here. You see the development of the Net Promoter Score since 2014, a gradual increase from 36 in 2014 up to 42 last year. And every point of MPS is really a challenge to make one point of MPS improvement. Clearly, this year, with all the operational disturbances we had at Gipple in terms of runway maintenance, fuel supply. So we had a lot of operational problems really not helping us to keep that very same level of a 42 MPS. And just to underline that, you see on the right hand side, the non perceived failure MPS, that's in fact the score our customers are giving us in case of no disruptions. So you see that we are continuing to move forward and even now we're at the 62 score for our customers in case we're not having any disruption. So the key priority for us is to make sure first we have less disruptions to the extent we can control it ourselves and secondly make sure that the experience is better in case of disruptions. I'm very proud that we are back on the Apex 5 star ranking. And so we got that award or that recognition, I should say, really We got that recognition in September when KLM was back, I think I don't know, after how many years, but we were back only 5 star ranking, which is not the case for many of our competitors. I think it's underlining the investments we have been doing in our customer experience All our widebody fleet have flatbeds now. We start to convert all the aircraft with Wi Fi. Make sure that the lounge is ready. The flying blue program. So all the elements of the customer journey are nicely coming together and resulting in this 5 star APAC recognition by our customers. Fleet already mentioned by Ben, maybe shown a little bit different here. We see how we have progress in the last years in terms of fleet simplification. So today, almost at 2020, we clearly have reduced our aircraft number of types. We still have a couple of 747s as mentioned, the last one should be out 2021 ish. It's not the exact date, but that's the timeframe. And then by 2025, for sure, will have 1 group of aircraft types, the 777s and the 787s for which cockpit is flying in the same fashion. So it's really a very efficient way of organizing this and we get rid of the situation we had not so long ago, even in 2010, with a mixture of MD11-747s, 330s and 777s. And again, for Klams network and the routes we're flying and routes we're operating this mixture of 777s and 780s is a good thing. Also, it allows us, in fact, to increase the average gauge and to fly larger aircraft going forward. And a couple of years ago, we did have 5 full passenger aircraft with 400 seats. Today, we do have 14, 777,300s and another 2 in order. So it just shows a little bit how we are moving forward to larger aircraft dealing with the congestion at Schiphol Airport. So how did that translate into the development of our ASKs? We did have a long haul ASK from 2011 to 2019, growing by 24% and a medium haul growth even larger from a level of 100 an index of 100 in 2011, up 34% to 2019. So we have really stepped up our network and part of the success you saw the numbers in terms of profitability has been able to build a network and making sure that we're active and attractive actually for our customers in all these markets with a high frequency network, what we're doing what we're doing here. And clearly, that brought us to a worldwide network with 171 destinations as we do have it today. With a mixture of 93 long haul and 78 to medium haul. It's also interesting to see for me that the network is a dynamic one So, 14 destinations closed, 46 opened. So, in fact, we're all the time reviewing our network and our agility in the market. And Ben gave the example of San Jose where France and KLM operate together. Saint Fortaleza in Brazil is another nice example where the two airlines are operating and together, we start to build a very nice market and a very nice position, really there. You see the network basically is balanced throughout the world. I think it's one of the biggest assets for KLM and also the biggest asset for the group that we are less vulnerable to local changes in South America or in China or in other parts of the world because we do have this worldwide coverage about the quarter of our long haul seats is to the U. S. And the rest is pretty much spread around the world. And clearly the joint venture with Delta being still the backbone of our long haul operation. And I should say the strength of what we're doing and really something unique which stands us out as Air France, KLM, any industry with this very strong position we have with Delta and soon to be added with Virgin. So I mentioned these partners already. We made in other parts of the world. I mentioned Delta already, but also our network in China, we have been able to build with our partners, both China Eastern in China, Southern and since China Eastern is also a shareholder in Air France KLM. We have really stepped up our efforts with China Eastern a couple of weeks ago we announced a further addition of virgin into that joint venture, strengthening really our position in this incredibly fast growing and continues to grow in a Chinese market where Air France, KLM together is a leader between China and Europe. So I think it's really underpinning our global presence and our global activity around the world. So the value focused model has been mentioned by by Ben. I mentioned here the key topics where we are and the key priorities going forward. And these sort of 4 pillars have been very much the basis of what we have been doing in the past couple of years and will be the basis in what we continue to do forward. I mentioned already the E2s and the 787 dash stands. So that's going to be the key issue for 202020 21 to make sure that we do have these aircrafts coming in and phased in in a quick and efficient way An incredible focus on asset utilization. You saw these slides. I think we're one of the leaders in the industry when it comes to asset utilization with wide body aircraft flying around 16 hours per day. 16 to 17. We knew 787s even more. And the joke we say internally, it's an aircraft. It's not a ground craft. So it should lie And with that, we put all the efforts making sure that it's flying as much as possible. But we do that combined with a higher load factor. So you see an gradual increase in our book load factor, reload factor slightly lower, but this combination really brings 170 aircraft 700 flights per day. For those of you still paying attention, Ben mentioned 350. So that's the departures. This is the total departures and arrivals. Here on Old Skippel Airport and resulting in 100,000 passengers a day, what we're having. And I guess we're not at the end of it And I believe that even in terms of utilization, we can continue to strive to improve that. And the fact that we continue with our fleet simplification really helps Clearly, our staff is the key focus in that. Let me take this page first and then go back a little composition here of what is our what's the composition of the KLM staff. And on the left hand side, you see the H it's very important that we have been able to hire in the last few years. A lot of new people, so you see 4797 new hires in the past few years. That was really very helpful and you see much less in the 6 to 10 year timeframe. So we're sort of catching up for a time where we didn't hire any new staff. And like any company and especially bringing in new talents and bringing in new technology and people knowing about AI and artificial intelligence and making sure that we use that. We put a lot of emphasis on the on new hires. Clearly a lot of operational staff, 3000 pilots, 10000 cabin crew and some 6000 working on the ground. And then the other composition. So staff is incredibly important. And with that, we have created the structure on focusing on the transformation of the organization, making sure that we put a lot of emphasis on our leadership program And at the end of the day, our social dialogue, which has worked pretty well in the last few years, where clearly our profit sharing mechanism has helped in moving forward and I'm very proud and glad actually we had a couple of years with nice profit sharing as a good way to get everyone motivated and on board for the things we are doing. That has resulted in a very positive employee promoter score, which I think is very nice. We're not an increase in our customer appreciation, our NPS, but also our employee appreciation. So you see the employee promoter score here on the on that side. Which is nicely going up and reflecting what people are feeling about working for KLM yet going hand in hand with an increase of productivity 13% in the last couple of years if we take the ASKs per FTE in terms of productivity improvement. With that, we realized that we need to do sort of next steps in order to move forward. So we have launched a wide range of initiatives next to CLA talks. We should also have more focus on the innovation So we're working really together with the teams in various parts of the organization. And this is just four examples and it shows For example, let me highlight 1, the additive manufacturing being done at the engineering and maintenance team where we really start to experiment with 3 d printing in order to make sure that it's really helps us to reduce our costs. We're not doing this for fun. We do this to deliver a better customer service And at the end of the day, also lower our cost. So that brings us to the topic of sustainability. I'm sure you've all noticed our fly responsibly initiative, which we launched in June of this year. I think the Guardian in the U. K. Called us the only woke airline in the world, which I took as a compliment. But it really was very nice to show how, in fact, this is really helping us in order to get not only for our employees, but also increasingly for our customers, the initiatives around sustainability there. We have set a couple of horizons. So the first one is 2025. We continue to invest in biofuel. We launched some actions to created biofuel factory in the Netherlands, but also have stepped up our efforts in terms of CO2 compensation and making sure that all our ground equipment is more sustainable. Somewhat later 2030, all the fleet renewal should be done. You saw what we're doing in terms of fleet renewal And we put here electric flights 2050, and you see on the right bottom, a futuristic program being worked on by the Technical University in Dallas which is called the flying V. And we will not be building aircraft. We will not be making aircraft ourselves, but I think it's a great way to work together with university. Make sure that we're aligned on our ambitions and our targets. So a lot of emphasis on this, a lot of positive response. And in fact, when we celebrated KLM 100 years, we shared it all over the world. And we really get very, very positive response basically in all the countries we're operating and ranging from China to Brazil to European countries, very positive feedback and really helping us to continue the pioneering role and position. In closing a few words on Skippel, we we know that we have reached a ceiling. This chart shows a line in orange, which is the number of movements and the line in blue, which is the number of passengers. So it just shows that after 2005, we had a 23% growth in movements today, the ceiling of 500,000 and a 61% increase in passengers. So today's Kippel Airport, 70,000,000 customers. So It shows that even with a limited number of growth in terms of movements, we could still have growth in passenger numbers. There is some movements on the file in terms of a political understanding that further growth could be accommodated up to 540,000 in coming years. Still a lot of details to be worked out. Any opening of Lelistat, and I know some of you have always a difficult to pronounce it, but the opening of Ladystadt is still being expected somewhere next year. It should really help us to move forward And we made a very big announcement that we're going to replace one of our flights to Brussels by train really to start experimenting with luggage transfer through check-in, disruption handling and so on and so forth. The Konzavia was already mentioned. We have stepped up really our efforts to make sure that we maximize the synergies between KLM and Transavia in the Netherlands. Clearly, the combination of the 2 brands in the Dutch market extremely important for Tanzania, the Dutch market HD number 1 market for KLM is just 25%. If we combine it, we really can serve our customers better in terms, for example, of our flying blue where we can now earn and burn on Transavia in terms of co chairs where we do have seven codes here. So a whole range of initiatives we're doing together. And just to make sure that we remain the number one low cost in the Netherlands, Amsterdam 28 aircraft, ANK overnight and Rotterdam 8. And that's about the number of airports we do have in the Netherlands. So that shows our presence here at these airports. In closing the priorities going forward, will continue to make sure that we have an integral approach running the business. I'm very I think it's very important to have the cargo engineering part really integrated to it because the wide body capacity for cargo is huge. Skippold is going to be the second part where our focus is financial health, we are matching the targets Frederic Casier has given us in terms of EBITDA, but still we have more ambitions going forward. A search for new synergies, Ben already mentioned it in the Air France context. And last but not least, focus on people and technology I think I'm 2 minutes late. So my big apologies for that. So we count usually arrival plus 5 minutes as on time. So I count sometime. And that gives me a big pleasure to introduce as a next speaker and a warm writer for applause for Thank you, Peter. Good morning, everyone. It's easier to say than So, Ben has presented you the financial trajectory, and I have a very easy task to explain you how we will improve the reference result by 1,000,000 by 2024. But let me just begin start with our environmental commitments. You know, it's a very strong expectation from our customers And we want, as Peter mentioned it, to be pioneer, to build a most sustainable travel experience for our current and for the future generations. So we have also renewed our environmental ambition with strong commitments. So this one. The first one is that we will decrease our CO2 emission by 50% by 2 1030 compared to 2000 and 5 with a whole bunch of action, further renewal of the fleet each new generation aircraft brings a decrease in CO2 emission by 20% to 25% eco piloting, decrease of all the weight on board and also carbon neutrality for our ground activities. The second commitment we just took last year, last month, sorry, is to above regulatory compensation to offset 100 percent of our CO2 emission on all our domestic flights. It means 4 fifty flights per day where our customer will be able to fly totally neutral. And the third one is around, single use plastic. We have committed to remove 1300 tons of a single use plastic each year, and we are beginning, next January with all plastic glasses plastic cutters, materials, etcetera. So I think it's very important to show our customers that we're fighting to build this green sustainable aircraft, even if we can't build aircraft ourselves. As Ben said, above CSR, we are launching an end to end transformation at Air France. We've made a full diagnostic in the spring in April. With a benchmark on all our processes and our cost levels to compare with the whole industry and to evaluate our potential. During the summer, we had defined our action plans and our projects and now we are in the implementation phase. And as Peter says, we don't want to hallucinate anymore but we want to come to the execution. So sorry it was this slide, but you will have it afterwards. So our financial recovery is launched now around 7 clusters. 5 clusters in order to optimize our operating model. So the clusters are a simplified organization the optimization of all our external spends, of course, the fleet, as Ben said, this third key lever is the renewal of the fleet and the domestic network redesign. And I will go further into more details. Also, to tackle our tech transformation and the Feds driver is the operational transformation. We want to reduce our operational costs through simplification and through digitization. 2 plasters aim at growing profitable passenger revenue. The first one is the network redesign and the second is about all the revenue enhancement initiatives, personalization, loyalty program, and ancillary program that can increase their contribution. So overall, it's more than 150 projects that we are closely monitoring every week in dedicated and very tough meetings. Sorry. So what will be the impact of this 150 projects. We estimated that overall, it will bring more than 1000000 by 2024. That we can split in 1000000 for the simplification projects I just mentioned. 1,000,000 coming from the fleet renewal and 1,000,000 coming from the revenue enhancement. But we don't want this transformation to be only an economic transformation. We want also to measure 3 very important KPIs, the NPS and Net Promoter Score for the customer satisfaction that is at the basis of everything, the employee promoter score for the employee engagement and the major KPI for the CSR is the CO2 emissions. Let's now focus on this simplification project. In 2019, we took short term emergency measures in order to keep our costs on track. In 2020, accelerating the implementation of transformation projects. And I will go a bit into the details to give you some highlights. Regarding external spends, we are currently reviewing all of our contracts. All of our providers. Regarding IT, we are prioritizing and standardizing our solutions and we want, of course, to develop further agility in our innovation projects. Regarding the organization, you know that air France is an older airline, not as old as KLM, but eighty six years old, eighty six years old of history, of layers sometimes. So we want to simplify our organization that is still complex to break silos with a specific focus on other heads and on support functions with principles like delayering and mutualization, of some support functions as communication HR or finance. The 4th important stream that we will accelerate this year's operational. The improvement of the operational performance brings some decrease in the customer compensation costs, but we also tackle fuel consumptions with Ecopylating We also tackled the maintenance cost and maintenance is fully engaged in this transformation and we will launch an ambitious supply chain program in 2020. So if we look at what we'll deliver this simplification program, we begin in 2020 with 1,000,000 and we'll ramp up to more than 1,000,000 in 2024. On the second pillar, that is a fleet simplification, Ben has said a lot about the complexity of Air France fleet. I will only say that we just have received our 2 first Airbus 350. We will have 6 this summer, 10 next summer in to 202120 8 by 2025. Regarding the medium haul fleets, we've ordered 60 Airbus 220-three 100 that will replace our Airbus 3 18 and 3 19. The first ones will come as of September 2021. And regarding HOP fleet, HOP fleet is delivering operating flights for hub feeding in Charles De Gaul and also on domestic network. We will phase out, I think, by the end of this year, HER, and also Embraer 145 next year. So this change, on the fleet, bring multiple benefits Of course, scale savings, unit cost, when you look at the cost per ASK over Airbus 220, it's a decrease of 10%. Above 350, it's a decrease of 15% of the unit cost. Of course, it also brings operation reliability and enhanced in flight experience. If you take an Airbus 220, you'll see that the comfort of volumes, the pitch you can benefit from is a lot higher than what we can find on our current fleet. And of course, on the CSR efficiency, the renewal of the fleet is the first lever. For example, you have a 350 consumes 25% light fuel than the current aircraft it will replace. Regarding the network I think that Ben went into many details about it. So I will only say that our priority is to build on our main asset. That is our strong position in Paris. You know that Paris is at the same time award leading leisure destination and a strong position for business traffic with many global firms that have their headquarters in Paris. So taking more value of this kind of traffics is key for our transformation. On the network side, we think that Air France hub can be further optimized through dynamic network management, what's that, is just to relocate feet and flights from less dynamic arrears to more profitable areas. And that's what we've done this summer and we will go on next summer. It's also to increase our footprint on the premium local and French market flows. We are also improving our asset utilizations. You can see that we have improved by 12% our medium haul utilization aircraft utilization in 2019 and by 3% on the long haul. And we also think that the increase of the load factor you can observe is not finished and we have room to for improvement also on the load factor side. This network redesign also, enhances customer experience by bringing more consistency to the customer offer with a full flat product on our premium routes to USA and to Asia with a consistent product on each route every day. And also for operational performance because we add spare aircraft without decreasing aircraft global utilization? Maybe a focus, because it's important in our core margin, we have to fix the losses of our domestic network through a whole restructuring plan. First, we are in the process of adjusting all his network to face a high speed train competition. And we are also reducing pro performing transversal routes that are exposed to low cost competition. We are simplifying our operation. As you know, on the domestic market, we only have one brand now and hope is operating the flights for Air France and under Air France brand. And we are also adapting the French station size. Through a voluntary departure plan. So this results in a decrease of minus 15% of capacity between 2018 2021. And this plan will bring an increase and an improvement of 1,000,000 to the domestic network result by 2021. Maybe just a look at the new opportunities we see in all the airports due to a better connection with Paris with new mutual lines like line 14 for French people and a better customer experience because of the refurbishment of the whole airport. So we want to take 2 initiatives. The first one is to launch quality routes that are tailored for business customers from Olli to Europe. And we will start in next April with the opening of a route from Ollie to Madrid. The second one will be to launch Europe leisure European destinations to adjust the seasonality of French business demand in bank holidays in weekends and of course during the vacation months of August. That's something we've tried in child support the seasonality and very effective in terms of network. Of course, on the early strategy, the growth is of Transavia France is key to strengthen the number one position in Norway of Transavia. So Ben has stated the pilot negotiation that we conducted this summer has unlocked the future for the growth of Transavia with the removal of Transavia France fleet cap that was kept to 40. Now it's unlimited and the removal also of all commercial constraints like windowing operations with our France or co chairing with Air France. Now it's fully opened. Let's come to customer experience because it's another major goal for improvement. So you know the definition of Net Promoter Score, you ask the customers at the end of the flight if they would promote your brand with a grade from 1 from 0 to 10 and you take the promoter given 9 or 10s and minus the detractors giving 0 to 6. So you can imagine that half of our customers are French. It's not so easy for a French cost much to give 9s of 10s, but still, we can see this year 1st very encouraging results in the NPS measure. With 25 year to date in 2019, and we see it increasing in the last month 13 September 32 in October, and we are targeting a 40 NPS in the coming years. We see that the improvements come from 3 key drivers, the product and the services up upmarket move. The operation performance and the way we handle the disruptions. I will Maybe just focus on some example of the customer experience improvements on board just highlight 2 of them. First one is, of course, long haul cabin modernization. 80% of our long haul fleet will be at the highest standards in, next year. So, of course, full flat, best seats in a business class, high definition screens everywhere and more comfort everywhere, and 100% by 2022 with the addition of the refurbishment of our current aircraft and the entry of service of the new generation aircraft with the highest standards on board. Of course, Wi Fi is now a basic expectation from our customers, 50% of all our aircraft short haul, medium haul, long haul will be equipped with Wi Fi by the end of this year, 100% in, during next year. The second topic that is very important for customer when they buy an Air France ticket, they expect even French customers to leave a bit of the French Artovir and the French gastronomy. So the expectation is quite high And in business class, that's why all our business mills now are signed by Michelin Starchefs And, we also want, by next January, our customer to be able to preorder before their flight, their meal. It's some details, but it's very important in the customer experience. A consistent, experience, we also want to introduce a business class on our French domestic network. So in the beginning of next year, so on the ground access to Skype priority access to the lounges and onboard a dedicated front cabin with blocked the block middle seats and a food and beverage dedicated offer. And we think it will be good for our customer connecting to child support in the premium cabin, but also for the consistency of the whole brand and the domestic network. On ground, of course, we want also a syringe, peaceful ground experience. So lounge is upgrade. We've done a lot in the last two years and we are continuing next year with refurbishments of early international launch Geneva, San Francisco, Los Angeles, and a big lounge in terminal F for Schengen flights that will be available at the end of the next year. Another key point is the way we handle disruptions and we lean on technology for this to enhance the experience on the massive rebooking tools so that the solution given to the customer comes very quickly and also on technologies of bots and digital vouchers that we can push to the customer to accelerate the customer service in case of disruptions. Operational performance, of course, the basic expectation. So our business is complex, many kind of So we are fine tuning our processes with 1st good results this year, and you have, the result of the routing in terms of arrival punctuality for the last month. You can see that among European Airlines, our ranking has improved. And in September, we were the 3rd after I think I have a slot in thin air. And we also observed strong results in terms of completion factor, baggage irate, and connection success for our customers. We also launched with our partner delta that is really best in class in terms of operational performance, a program that we call counsels the consolation. So it means that we want to drastically reduce the disruptions. Let's come to innovation, of course, technologies and enabler for our transformation, but I would prefer to focus on the human touch That is really part of our DNA, because data really helps us to transform our core experience. We have now a customer 360 view that is connecting to more than 20 touch points And that and that means that customer data are available to all our staff, ground staff cabin through pilots They can know, through their iPads. Each one is equipped with an individual iPad. So they know the customer preference for frequent fliers. What is a preferred meal, what is the allergies, but they can also anticipate the needs and create an emotion. I will give you two examples If a customer, book to TTS seeing it's a birthday of its Oneman, the call center agent will put the data and the cabin crew will welcome the couple with champagne. And it happens a lot. It's not just one case. If a customer has an incident at check-in or I don't know, it will be reported and the cabin crew will do the maximum to offset this kind of disruption. So you see it's really data and technology enabling the human experience. And to finish, I will end by saying that, none of this transformation would be possible without the engagement of air and staff and the renewed social dialogue. We've signed 26 agreements, in the last 12 months. It's an ongoing process last Friday. We just signed a very important agreement with our cabin crew. And I would like I would finish by, saying thank you, to Efren staff for their support in this transformation, for their support in designing and simplifying our process, and, sir, for the commitment to reinvent Air France. My apologies to my preferred Bhatronic CFO, Mr. Gauje. Okay. Slide number 98. So, yes, there is still 150 and then we'll be able to move to the Q And A. No, you are very, very patient. I will try to be a bit quicker than the program if possible. Okay. The problem is, to try to summarize all this type of info and to see what does that mean in terms of financial path and financial trajectory. Before that, just one or two slides. So where do we stand today? I think that probably the most remarkable evolution for the group since 2012 is the evolution of the leverage. As you know, we spend a lot of, of time and energy in order to try to come back in an area of the adjusted net debt on EBITDA compatible with a normal relationship with banks. I will say. It was fairly not the case in 2012 when we had a level of 5 foresees ratio. By itself is not a drama, but at least it's showing some fragility as it was outlined, which are quite higher, to be honest. But I think that the consensus into the group, to consider that we should come back to a level compatible with something like investment grade was very clear. And I think that when you look revolution of Cs ratio. It has been a successful strategy. Today, we are at 1.5. Is something which is comparable to IHA and Lufthansa. So, with some different in the calculation, how do you treat functions that's around. But normally, we think that these numbers are all correct, which means that Air France KLM today. Is comparable to the 2 big peers in Europe and with the level compatible with an investment grade. Of course, over the period, it is more than 'nineteen with, last 12 months. It is minus 4.3 of unit cost reduction over the period. I have 2 remarks on that. It is not a lot. You can say minus 4.3. Okay. It's just, okay, just a small effort. I will be very happy to be honest to see airport having decreased the charge by 4.3 over the period. I will be very happy to see the price for aircraft. Going down minus 4.3 over the period, and I will say the same for a lot of growth suppliers. You know the story of where the airlines industry is in the value chain, you know, that many of our suppliers are oligopolistic or monopolistic. And to be honest, such, performance in terms of unit cost is something I consider as extremely positive. We are not the only one to have achieved such a result. But I believe that if you compare the performance of Air France CalM to some others, we are really not the last one. Part of it is coming from a strict control in terms of the development in FTEs. We have the FTEs on the wide with the The blue bar and the green line is the productivity. It is partly explained by the sale of survey. Which is expanding the drop in 2015, 'sixteen, but not only I think during all this period, We have increased capacity, increased traffic, and also exerted a very strict control in terms of 50. And the result is, what you see on the slide. And then as a conclusion with Allstate's approach, of course, but also that we share with the rest of the industry, an improvement of the operating margin following the crisis of 2009, which hit dramatically is the Alliance Industry, a peak in 2017. And as we commented last week, when we presented the reserve for 2019, we today, macro environment, which is clearly a bit less positive compared to the last 2 years. With one issue, Air France is not Air France Calam, so he's not at the top in terms of profitability, if you look at the European airline. Clearly. And you know that by heart and better than me. AG is presenting a very high margin. If I pick of a complete group at no nuclear cost. And you have refined KLM, not so far from Lufthansa, depending on the year. And finally, the big point I would like to comment and which is clearly explaining a large part of the plan presented to you, this morning. The difference of margin between Air France and Calle. With 2 periods, you see that on the graph between 2012 to 2015, a gap of 2.5% in terms of better margin between Air France and KLM. And in 2017, 2018, an enlargement of this gap, which is fairly, I will say, a source of frustration frustration first because, of course, it impacts the global profitability of the group. I think also it is not a sustainable situation. Clearly the correlation between the two carriers is something which is extremely important. The way people, the teams work together is something very important. From that point of view, if you maintain 2, during the 2 long periods such a gap, I think it's not good for the Spirit and for the capability to people to work in a very open way together. Sorry. We're saying that to add, as a target. To come back to a more reasonable level of gap between the system margin is something which is extremely important. Sometimes when I'm doing what show with some of you, I have the question, but what could be the normal gap between Air France and Karim in terms of in terms of operating margins. My answer is to say probably a little bit like that. But also with a bit of experience, I think that probably 2.5% or 2%, 2.5% can be easily explainable, yes. Is it explainable because there is some difference of environment in France and in the Netherlands. We know in France that there is a session of labor, which is a bit higher and probably not optimal. A lot of macroeconomists in France indicate that when they try to judge the labor market in France, the efficiency of, probably, Chardugo is not the same as a Shripaul. The site that Air France has to operate 2 airports in Paris in Not optimal, of course, why it has to airport. It will be far better than 12 only 1. When we can have both the domestic and the connecting traffic on the same platform. So for all these reasons, probably, to imagine that for Air France, it would be easy to have the same margin of Calum is probably a dream. But it says that probably a gap of 2, 2.5 percent is something which could be, we deliver. It was the case more or less at the beginning of the period on the slide, when we are deformed between 2 to 25 depending on the year. Clearly, during the last 3, 4 years, this gap has widened and it's a situation. We have to, to correct. And, that's a lot for running for the Air France team, of course, but I think that is an absolute necessity. How to 12 trends the evolution of this of this gap of margin between the sort of last year. It's a bit there is a reasonable amount which are awfully or part of sales. So I leave you to judge when you look at at seas. The first element to keep in mind is that when you look at the labor cost as a percentage of the revenue, Probably somebody not knowing there, well, the group will say, oh, it would be far, far bigger into Air France and, compared to KLM. In fact, it is not the case. We have, if you look, the P and L of the 2 companies, what we study every month with the controllers of the group and with Anna Peters. The gap is in the range of 1%, 1.2%. So that's a lot in terms of margin of growth, but it is not it is not such a big difference. And it is less than what it was in the past. You have at the bottom the evolution of this gap since 2012. It is not totally homogeneous because you have a treatment of the pension for KLM. But if you look at that, you'll see that this gap in terms of what is the weight of labor cost in the turnover. We were at 5 1 hour at 1 1.2, yes? I say it's a bit volatile, and it makes life a bit more complex because it could be easy to you have just to reduce the number of factories in Air France and it's done. It's probably more complex than that. It is not only the labor or per revenue, It could be so the FTE of the profitability per FTE. It has to be, leading to think about what is the efficiency of the process. But just for you to keep in mind is a bit part of solar half part of solar result. Second element, which is probably more easy to interpret, when you look at the difference of margin for EBITDA, it is nearer than when you look at the operating margin. And what does that mean if you consider what is the EBITDA and the shrimp between EBITDA and COI. That probably the efficiency of the use of assets in Air France is probably less than in Karim, is less than Karim. Or you need more assets to produce the same coin into KLM. We saw an example or use an example during the presentation of, of NLP which is the fleet utilization. Clearly, KLM is extremely good in terms of fleet utilization for the long haul. Airfront is not the war for in class, but it's a bit lower, and there is, by heart, 6%, 7% of the front between the two car years, Of course, because of the existence of the domestic network, And the platform of Ollie, it is a source of unefficiency in terms of fleet utilization. And here, clearly, We have assets which are less used or less intensively used by Air France than that by KLM, which can explain also part the fact that sees the weight of the depreciation in the reference model is more important than in the KLM model. And at least it can be a source to think about how to improve the efficiency and to contribute to the improvement of which are well known. 1 is the existence of a domestic network in France and the obligation for Air France to, to operate this domestic network. It is not very efficient because of the two platforms, I'll already indicate that. We also know that it is a network when the intensity of the competition, mainly driven by train is something which is extremely high. And as a train, which is a political choice today, for the dead developing some trips internally in France, is developing with the recent opening of Bordeaux and also the part of the high speed train to the west of the country. Clearly, Air France has to adjust to adapt to continue this endless process. Consisting to maintain a domestic network, but by adopting itself every year due to the development of the prem. When I put all these elements together, I just show Mark that there is some part of the group airfront where profitability is all comparable or even better than in KLM. A good example is Transavia. Out of some years where Transavia France were still relatively small compared to Transavia. How long? Already for 2 years, the profitability between the two airlines, the 2 Transavia is almost the same, which means that when you exclude the legacy impact or the impact of the legacy and you create something from scratch as it is the case for KLM sorry for Transavia France, which has been created in 2007, you're able finally to build a structure, which can be as profitable as what we have in Holland and the same is true for maintenance. Even if maintenance is relatively labor intensive, even if we immunity in a group like Air France CRM to develop in Paris or mainly in Paris and activity of maintenance which is even comparable or a bit more profitable than the counterpart into Amsterdam. So having said that, let's go to the model we have in mind and the target we have in mind concerning the future development of, of the Air France Care And Groups. So, clearly, A fundamental idea of this work is to consider that the margin of Air France has to go a bit further to the margin of CALA. Keep in mind that there is is a very difficult to solve a gap of 2.5%. We can see there that there is some margins, some real and strong margin of improvement of the margin into Air France. Even more than into KLM. For KLM, the challenge is a bit different. KLM is already quite well positioned in Europe in terms of profitability and in terms of a provision margin. And the challenge is more to continue to stick to set up a position among the various European players for Air France. It is really an improvement. And as explained already by Benhe Anne, we consider that is the contribution of Air France to the improvement of the group margin could be over the period 2019, 2024, or the order of magnitude of $900,000,000. Keep in mind that it is a net contribution, which is that it is, considering also that there will inflation, which means that the plans behind such an improvement is far larger than $900,000,000. So it is really a great effort, which, clearly, is based on the idea that it is a transformation, a recreation of the model of Air France during this period. Which is clearly a challenging target. We really believe that it is something which is absolutely necessary savvy for the reason explained before. So KLM, the contribution is to stick to the 9%, 10% of margin that the company has already reached in the past, so it is starting to continue on this strategy, keeping also playing on all the what has been acquired during the last year in terms of efficiency of the process, quality of all the relationship with the customers and development of the of the new tools in terms of digital, in terms of innovation. Concerning Transavia, we still consider that there is a potential for Transavia, mainly at Orly. We play the game to have a very strict control of slots, concerning the airports of Ollie. So it gives opportunity for Transavia to continue to develop its presence into Ollie. We will see what happened with the traffic wise to Algeria after the bankruptcy of, of egg last year, but we hope also that there will be some opportunity for from the local company out of Olli, and you heard recently. So, we need to go to plan to open new base out of the French province and the name of MOPRI has been given by, by Ben. So, you have the split of the contribution around the simplifications of it for new vols, the renewal revenue, so a mix optimization. Fleet's renewable, we really believe in that probably Air France is a bit late compared to KLM concerning the renewal of the fleet. We have still 3:40. There is a 380 that after some agitation, we have decided to phase out. And we are also convinced that the deal we have, as a MoU today with airbrush concerning the 220 is providing a very good cost base for the future medium haul activity into Air France. And as Ben said, there is still discussion concerning the possible choice between the 3 50 or the 787 in order to partially compensate the phaseout of the 380. But as I said before, it is mainly what we named simplification focus, which is the largest contribution to see the improvement of the margin of Air France. A lot of things are beyond that. It's clearly a big challenge for and And again, this net $400,000,000 have to also be considered as compensating for inflation. In terms of, time path, it is, of course, a regular evolution between now 2024. We see already in 2021, some of the impact, but currently, the fleet renewal impact will come a bit later. After 2022, when we will have introduced the first airbus to 'twenty and progressively increase the fleet of 350787 and when the 380 are phased out. For KLM, Again, I don't say that it is easier, but at least the label today is clearly more satisfactory than what we in Air France. So the problem is more to compensate for the risk of inflation. And of course, always a stronger competition. And for that, the plan build by the CalAmp teams is a build under our focusing on the cost and operational excellence, even the result of Alema, extremely good today. The fleet renewal with especially the Embraer 1.95. They will enter the fleet as Peter said in 2021. And revenue mixed optimization with the same as Air France, a timeline, which is relatively progressive, between 20202024 and with, ultimately, the target to maintain mid cycle, a margin of 9% to 10% 2.5% above Air France, but together with Air France, of course, contributing to the improvement of the group situation. Beyond that, it's clear that the CapEx in FITI beating significantly to the improvement of the margin of the group over the period and to the sustainability of the group margin over the period, which means that in average, we have in mind that the CapEx between 2020 and before could be around 4 1,000,000,000 a year. By the way, this CapEx take into account a very, very good hedging portfolio we have concerning aircraft. We valued all the options We have concerning the acquisition of aircraft being protected against the dollar at something which is around 4 $100,000,000. 4,000,000,000 of CapEx as an average, but under the assumptions that we reduced significantly the percentage of leased aircraft. Which means that takes that really as a as a way to calculate the CapEx. We suppose that during the period, we may use the percentage of raise aircraft from 44% to 33%. Yeah, which means that if, of course, we will just decide to keep at the same level is presented. The level of CapEx will be far less. You recognize my my admiration for IFRS 16, which had forced airline to treat on same way, leased and full owned aircraft, which means that for me and I already repeated that to you many, many times, the most important Capier now is not so much CapEx, but far more the adjusted net debt on EBITDA, which is globalizing both the leased aircraft and the all aircraft. And in fact, when we look at the plan as we have built it, it is more CapEx calculated during the or according to the way I just indicated, it is reducing the percentage of leased aircraft, It is making, of course, a fleet younger at the end of the period, but it is keeping the adjusted net debt on EBITDA ratio around 1.5%. It could be probably a bit higher than 1.5 for Air France. It could be a bit lower than 1.5 for KLM, but in total, during the period, we continue to be focused on leverage which is maturing the group in the situation to be investment grade like. We think that all what we have done during the last year has been extremely important and to move from 5 to 1.5. And so, I think clearly, not to enter in a period, we are prudently we will leave the control of this very important issue. So, which means that if you look at the evolution of the group, in a very sensitive way. You see that the adjusted free cash is positive, adjusted. So it's operating free cash is positive, but the adjusted operating free cash, accordingly to IFRS 16, can be negative at the beginning of the period, but even during all the period, we maintain the adjusted net debt on EBITDA below or around 1.5 and probably even better than that at the end of the period. So that is clear. Clearly, the group has probably under invested between the period 2009, 2015. Sometimes some of you made the remark during what shows that the CapEx was below the depreciation. And some of you indicated to me that it was not a sustainable situation, and I agree with that. I cannot have being a long period, a company which is investing less than the depreciation. We consider that today with the plan we have concerning the fleet Sam PCT into KLM, and the program of Air France consisting to phase out the 380s, the 3.40 and to focus on aircraft with a smaller gauge is something which is consistent with the strategy of market as explained by them. But even if this strategy need some investment. We will continue to be clearly with the strict control of the leverage of the group. In terms of capacity, altogether, these fleet plans are supporting the IDs of the group capacity will increase between 2% 3% per year, including Transavia. And if you look for Air France and KLM for the period 'nineteen-twenty two, You see that even the growth in Air France will be lower than into KLM, 5% compared to 10% versus prior 2019, 2022, important also, the fact that in terms of gauze of the fleet, the gauge of the fleet in Air France is supposed to reduce a bit When the gauge in KLM is supposed to increase a bit, which is clearly the reflect of the 2 strategic orientation given by both Anne and Peter. In KLM, there is a constraint on capacity reports, so you have to try to have a bit larger aircraft in Air France with the end of the 380 and the focus on the improvement the margin. It is the strategy to have aircraft with a slightly smaller size compared to what we had before. In terms of cost control, we have built this plan and all the action behind in order to target cost reduction -1% per year. 2 remarks: 1st, inflation is increasing in Europe, which means that to reduce unit cost by 1% or 1.5 when inflation is 0.5. Is relatively easy. When inflation is 1 or 2 percentage, of course, no, not possible. So you have also to consider the minus 1 Also, that it is a minus 1 in the context when you see inflation increasing a bit compared to what it was during the period 2012 1050. We were below 1% quite often during this past period. And now, if you look for the future, we are not leaving in and out by a month, where the inflation is between 1% 2%. So I really insist on that. It is minus 1% but it is in a context where inflation is higher than in the years before. 2nd, if you try to compare that to the competitors, Keep in mind that we compute this inflation. At constant fuel cost, which means until the base of the cost, we take which will take all the costs, including the fuel cost. Some of the competitors are doing the unit cost evolution, excluding fuel cost. When you do the balance between the methodology, it is it has, of course, a significant impact. Shareholder dividend. What do we think? We are sticking to what I explained to the market in 2017. It was a bit a complex sentence. It's a complex that I have to read it again. So, if we will 1 day generate again a profit at the level of 2017, then the question of a dividend became relevant. So I continue to maintain this approach. It's a sense that, yes, we know that we are really focused during the past period on the deleveraging of the group. And instead of paying dividend, it's true we have first reduced the debt or the adjusted net debt. And speaking again with some of you, probably not all of you, but at least some of you, sometimes people told me that we are wide, in fact, to focus first on the deleveraging of the group before to considering paying a dividend. But having said that, if I look at the trajectory we proposed to you today is clear that he opens the road to until one day. In more strict and consistent dividend policy. We could consider as soon as the operating result is more than 1,900,000,000. It should be normal and, wishable to pay to our shareholders' dividend or the order of magnitude of 25 percent of the underlying after tax profit. And again, this approach is consistent to what I explained to you some years ago in 2018. So, as a conclusion, a strong commitment of the group and the management to improve the margin over the cycle for the group Behind that, even stronger commitment, and I know it's not easy. Of the Air France management, it will be, of course, France scale and approach, but to reduce and to bring back the margin of Air France and deliver a closer to the margin of KLM, considering that this gap is not opening the way to the sustainability and the capability of the group to work in an efficient way. So we have absolutely to reduce that gap to come back to the situation we had years ago. And for that, a lot of work and a lot of plants are already ongoing into Airfront. 3rd, we are clearly moving from a period where the level of CapEx was relatively limited and probably a bit too low. We have today plan, which are, I would say, rational, efficient in order contribute, thanks to the evolution of the fleet to the improvement of the Air France KLM margin. But even if we consider that these new investments are needed, we are not leaving our strategy to continue to maintain our net debt and EBITDA circa 1.5. If I speak still 12 seconds, I will be exactly on time. Okay. Thank you very much. Okay. So, thank you all for listening to all of our presentations. Before we start the Q and A. I just want to point out the rest of our executive team who are in the room with me here at the group level. We have Anne Sofia Lelee. Who's here in the first row. She's our corporate secretary. We have Peter Boudzma and Patrick Alexander who run our commercial division We have Jean Christophe Lalan, who runs our IT. We have Anne Brache, who runs our maintenance and engineering. I've already pointed out Janet. Who else is here? I think if I missed anybody. Oh, we have, Angus Clark, who is our head of strategy. Okay. So why don't we move over here and we can start the Q and So, while our 4 speakers are taking place for the Q And A session, I would like to quickly remind you the rules of this exercise, but I know and I guess that most of you are very familiar with them. Would you please state your name and the name of your institution before asking your question. So those who do not know you, but more importantly, those following us via the webcast will know who is speaking. Our Q And A session is now planned for 50 minutes. So in order to maximize the opportunity, for you to interact with the management team. I would kindly invite you to limit yourself to two questions. I say too, but I know that all of you will negotiate for a third one. So, let's open this session, and Wouter Van Bic from our IR team in the room and our staffing uniform, will reach you with the mics. Derek? Thanks. It's Jarrod Castle from UBS. I will limit it to 2. Just firstly, have these plans been shared with the unions And also can you talk a little bit about how you see the evolution of staff numbers, between now 2024? And then secondly, you spoke a bit about consolidation. Can you kind of put some metric behind it and linking to that, what you'd be looking for? Obviously, IAG, with A or Roper, etcetera, isn't something you've done. So question, why not? Thanks. Okay. So first part, on the El France side of the business with the employees, Every, every strategy that you saw here today has been has been spoken extensively with staff. Big part of this has been developed with our staff. So the removal of the ASK metric or the evolution of the SK metric, the Afros pilot, contract. To explain what that would unleash, took a long time to build the trust and confidence to get our pilots to change that metric. It's been in place for a very, very long time. And without trust, there was absolutely zero desire on their part to change that. So to explain what benefits that would provide Alfrance that we did get an overwhelming majority of pilots endorse that plan. For the full efficiency of the fleet that's coming into Alfonso, so the A350s and the cabin refurbishment that we'll be going through on the remaining 777s, the new cabinet agreement that, Anne mentioned will really help us optimize where our staff work onboard the airplane and how we can fully configure the airplanes without some of the no restrictions we had in the past limiting the size of business cabins to ensure there wasn't a punitive hit if you added two or three seats. An example would be our 770seven-300ERs with 42 business class seats. Just to get it up to 43 seats will be very punitive. So a lot of lot of improvements there. And that, of course, took a lot of discussions, with the cat and crew. So, yeah, I can't I can't I'm going to go through the whole list. I won't do that right now, but there's if you want to speak after with Anne or myself, I mean, this has been a 13 month exercise to make sure that all of these plans are well understood. And I think that's been a big change at LFrost is having the stat integrated in all these decisions, if you look at the history of labor relations at Alfas, they have not been great. Last year a strike of 1,000,000 to go from that to, as Anne said, over 20 contracts being signed the last 12 months, I think is a huge achievement by the team, and I think is a great, is a great example of what we plan to achieve with the Aflons team going forward. So in terms of staff levels, there's an aircraft getting smaller that Alfonso is growing KLM also growing. It goes up and down. What are we going to do with Salveil? What are we going to do with Amadeus? I'll let both Anne and Peter perhaps go into more detail at each one of the business units on, what we're doing there, so each one of the brands. Then of course Transavia France as we grow, we'll be looking to hire more people there. So just a quick note on consolidation before I pass it off to Peter and Anne, So yes, with the announcement of IAG's purchase of ARI Europa, we do have currently, Air France KLM does have a joint venture signed with our Europa. We'll see how that develops. We also have an extensive partnership with GOL. And with what's recently announced, obviously it has a it has big, you know, big implication on antitrust and competition. So we'll be following that and we have a lot of comments and we'll be involved in those negotiations. And of course, you know, with the 20 percent investment in LatAm by our partner Delta that also does change and open up opportunities for us on on that front. So perhaps, Peter, you can start with KLM and then, in terms of the, the staff numbers, whatever else you want mix in with that question. Well, to your point on the staff numbers, if we see what we did over the last couple of years and you could see that on my slides, We have had a roughly 25% to 30% growth in ASKs. We actually do have pretty similar number of staff today as we had a couple of years ago. So, it's partly productivity and it's partly reallocation of some of our staff. Some of the efficiencies we have achieved on the ground, for example, all the automated check-in, all the self-service drop off machines, all the investments we have done in cargo short, the machine have basically These staff have been either reallocated or new staff have been hired. Going forward, we'll probably have a somewhat less ambitious growth trajectory in terms of movements as we know the situation at Skippel, but with larger aircraft will continue to grow. So our strategy here is going to be we move forward in the very same line. We invest in that stuff where it makes sense, profitable growth, some of our engineering and maintenance stuff. And where things are obsolete or changed, we will address it locally as we did for the last couple of years. Yes. On the Air France side, we are detailing the project we have in the transformation then. The big ones are obviously shared with the unions and the staff because we want this peaceful dialogue to go on. And to build a strategy with the trust of the people, but we are presenting the detailed program in the work councils that we have. Regarding the number of staff, you know that we've decreased the total number of staff in Air France by 10,000 people. In the past year. I think the opportunity we have is that the decrease on FTE's natural departures are quite high in each population. So and the dynamic of course will be different regarding other heads we are free we have frozen hirings this year and we want to decrease and to follow at least the departure, natural departure on the operational side, since we grow from 2% to 3% per year, we still need some hirings, and we've hired, I think, 800 people this year in maintenance in cabin crew on the pilot side and also on the ground staff at a are the goal, but not everywhere. And you've seen that we have a voluntary departure plan to decrease in the French station where the activity is decreasing. And when we build a project for that brings more efficiency in terms of productivity, of course, it's only to decrease the hiring in operation. So I think that it's quite easy to deliver regarding the employment problem. Hi, good morning. It's Daniel from Bernstein Research. Maybe if I could address my first question to Peter and Frederic. You've been around kind of for a bit of time, you saw the last strategic program, program too, which had similar characteristics as this one, what's different this time, And then maybe, depending on the EBIT increase is great, but that, of course, also is something unions will see. So what's your take on increasing EBIT and keeping it for investors in the end or for CapEx or for net debt reduction and not having unions bargain for an increased share of that profit. Difficult to say, what is different? I think that personally, I see a big difference, which is that when the plan has been launched, let us say that the situation to a short situation into Air France was totally different in the sense that the relationship with the main pilot union were extremely difficult, yes. And, it was at that time, to be for, not possible to speak about strategy with part of the direction of the NPL. To today, I think that after all the action described already by Ben and by Ann, we are concerning Air France in a situation where the quality of the dialogue is. So it's not better, which means that when you speak about the plan, it is not seen immediately as something which has not to be accompanied by unions, but it is seen as something which can be discussed. I plan, negotiate sometimes, but which is seen by unions and by the social body of our funds in a more positive way than before. So for me, it is clearly the big difference. The 2 former plants has been launched in a really hectic ambience, if I may. I don't say that the work is easy today, but at least for me, it is big, big difference. Maybe before, Peter talks specifically about KLM, I think a big change is the strategies and the objectives that we outlined here today for you have all been discussed at length with our social partners. As opposed to some of the, strategists in the past, which were put forward and then discussed, after the fact, with, particular the main pilot union in El France. There's a complete reversal so that we don't have to put something out. We haven't decided to put something out and then go negotiate it. We've done that. Ahead of time. Anything else to happen? Okay. And then, the second part of of the question. Just a gentleman I can't see him here is the incremental margin that we're targeting and risks that we may face with unions looking to get a larger share. It's very, very clear that the teams throughout the group, not just at Alfons, but also at KLM and Transavia. See what's going on with our competition know that if the group is not more successful in terms of bottom line and is not able to attract shareholders that the group will not be successful and that has a direct impact on the future of their job. So this is a this has been a huge, huge win, I think, for, for the group to actually hear the labor leaders speak like that. Now, of course, when you have many, many years of acrimonious relationships, you can't turn that overnight. But, if I'll give you an example when we had this opportunity in France with this failure of Eglazio the amount of effort that the S and Pale pilot leadership put into creating flexibility over and above what had already been negotiated to try, if possible, to make, a purchase or a merger makes sense? Was great to see. You know, the incremental slots that, came about, at all, Lee, our pilots did not want to see those go to a competitor So despite the fact that the labor laws in France made it impossible to go forward on that transaction, I mean, I was pleasantly surprised to see the amount of initiatives coming out from the S and PL. It was great to see. If I may answer to the question that was not directed to me, on the strategy, I think a big difference is that in this new strategy, we want to fix the basics. So the basics, it's simplification of the plant, simplification of the fleet and the efficiency of the low parts of the cabin configuration. And when you look at the amount of money that the amount of costs that you avoid with this kind of simplification And the fact that you don't have to negotiate so much, it's not social measures. I think that there is a big difference with the best strategies. Sandra Hara Dot Desert with Kepler Cheuvreux. Two questions, please. First, there is a strong correlation between passenger satisfactions, SkyTrax, ranking of airlines and their major airports. KLM is supported by an airport, which is relatively high, hugely ranked as the brands of Lufthansa What is your view on optimization potential HR the goal? What are you what is your view on terminal 4? In its current design. Yes. And second, do you plan some changes with respect to reporting such that over the next years, we will be able to track progress that we are doing on target highlighted today. Thank you. Okay. So, the experience at Edouasi, I'll let Anne take that part of your question. And I'll just briefly make some comments about the new terminal 4 project at Chaldegold. So This is a great opportunity for Alfrance to, to help design a new terminal that can be optimized for the operations of Alfrance and its partners. It is a very long term project. The estimated time to complete the final phase is 15 to 17 years from now. So what's extremely important for us is that we are not negatively impacted during this long transition. So this delay from first opening of 2024 to 2028 has been, in part because of our insistence that the 1st phase is either at the level that we have today or an improvement of what we have today in terms of connectivity and checking facilities. So that is what has been promised by Aeropo De Paris. And then on the cost side, we continue to push and lobby very hard that this terminal does not add to what's already a very high cost airport and the covenants in place is put in a similar way to the most successful airports? Yes. I think that's some big improvements have been made have been in Charles De Gaul since 1999. So I remember the first child to go and it has improved a lot. Recently what has improved is the police frontier with the biometry, much more fluid. It's also the access by car to the airport. And Ben has pushed a lot to have a better access and it worked. I think we have some room for improvement the first one is to have a good that all aircraft are handled with Jet Bridges. That we don't have so many remote aircraft. It's the case now for long haul but for medium haul, there is room for improvement and what we want with T4 is really to have all these irritants that are fixed. And we're working and I think we have worked quite well with I hope our Du Paris to modify the first project of T4 in order to have all the aspects of customer experience taken into account. I would just add one other point on Wazee Chaldego. There is a great opportunity as as the El France EBIT moves up, you know, in order to add flights, we do have runway capacity. You know, with 4 runways at OIC, as opposed to 2 at Heathrow and the limited activity that is available at Frankfurt, we do have something that is not available at or rather 2 major competition hubs. On your last mile, I see that the reporting we do is already extremely precise and And it can easily indicate the evolution of the KPI that just given during the presentation, the plan if you need something additional, we will do it, but I think that we are not planning to change dramatically as a presentation of what is owed as it is today because we think it's relatively what complete and it will be sufficient we think for you to follow the listing reporting. Okay. I take the point. I don't know. I will tell you. Thank you. Neil Glynn from Credit Suisse. If I could ask 2 questions, please. The first one with respect to Anne, maybe following on from other questions on incentivization. We've seen examples at other businesses within this industry as well as other industries where the first couple of years are easier. There's a lot of motivation, a lot of enthusiasm, and obviously from an Air France point of view, in particular, the base is low. I'm just interested from a structural perspective. How do you envisage tackling when let's say the group gets to 1,000,000,000 operating profit? And it becomes a lot more difficult to use some of the messages today as effectively to keep on that journey to structurally improve the margin sustainably. For example, at 1,000,000,000 operating profit, clearly the concern as to competing for investment, the concern on cash flow generation will be considerably lower today. So how do you think about incentivization? And then the second question for Peter, I guess KLM's margins peaked a couple of years ago. Just interested in terms of how you view 2019 where the margin was down about 3 points year on year in the 9 months. Do we need or should we see recovery in 2020 to kick start the path to getting back to 9% to 10%. I'd just like to get some clarity as to where the real base line is for KLM to think about Well, regarding the incentivization, I think that are, we will renegotiate our profit sharing agreement at the end of this year. So the topic is burning. I think that for the moment, it's quite clear that everyone is motivated by the fact to recover our margin and to get back to profit sharing. So as you say, it maybe will be difficult, I hope, in 3, 4 or 5 years. We are also focusing on incentives on, for example, ancillaries so that each one contributing to these ancillaries, to these upgrades, to this seat selling, etcetera. And we see that the share of Ancilloriza is growing that we can also reach on the short term, the people that make it possible and we've just, I think, finalized an agreement with ground staff and on this kind of incentivization. So the profit sharing, I think that the past agreement was quite okay, generous, and we will have to see what we can do in the future regarding the level and the ramp up of the margin. To add to that, before I answer your second question to me, I think we are in that situation where the margins indeed have gone up and staff could benefit and profit with it from our profit sharing mechanism. And I think the introduction of a profit sharing mechanism has really helped us to sort of keep discussions about salary about what's going on overall in the market. And if we see the overall salary increase in the Netherlands for the last 2 to 3 years, it's very different that the situation, which was there 5 years ago. So we can never completely disconnect the world we live in. And scaleM, we're the 2nd largest private employer of the country. So whatever is happening in sort of national salaries is affecting our discussion as well. But again, here, the 2 perspectives of profit sharing, 1, and working for a flourishing company which can invest in the future, which can invest in people, which can invest in digitization, which can invest in mobility is really, I think, one of the key assets in keeping that motivation high. Frederic warned me before we were sitting here today, don't make any forward looking statements. So I listened to the CFO, when it comes to giving any indication for next year's results. But I think it's fair to say looking at the presentation we're giving that some of the initiatives which were in the KLM breakdown of improvements will start to kick in next year. So yes, we'll have more new 787s coming in, which should be help of our fleet renewal program. 2, we do have an extensive program in order to have a better operational performance in 2020 than we had in 2019. And again, the weather we cannot influence, but some of these skippled disruptions should be dealt with in a much better way in 2020. So think we have all the actions in place in order to make sure that this level, which we have achieved in the last 2 years and indeed we're a bit lower now we continue and precisely in the presentation of Frederic, it's our ambition to continue on that same trajectory. Laurey Nache, excellent asset management. You didn't mention what could bring the fact that you lower the share of GDS and that you are doing more direct sales on So, especially the RASK improvements, could it be meaningful? Because hurt from other careers, atonne special routes, by example, in Switzerland that the rest could be improved with this kind of a shift by your meaningful amounts? We didn't attach a specific, target or number to improving our direct sales. What we're focusing on here is the improvement in ancillary revenues. That the ability to grow ancillary revenues goes up the correlation with the increase of direct, direct sales because of our ability to showcase our entire product offering. When you're in a GDS environment, or what's going through to 3rd parties that are dependent on that type of display. It's price driven And for our 2 main brands K11 Alfas, this is not the best way for us to sell. So I think that's the angle that we're looking at. Anything that we can add over and above the base ticket price is the improvement in RASK and if we can get customers to, to come directly to us so we can showcase it and put it on the shelf as we say appropriately. That is the increase. So that's why you see the the example there of ancillary revenues going way up. Of course, there's the actual cost component of the sale cost on the CAS side, which will come down. When it's, obviously coming to us directly as much cheaper. Hi, it's Andrew Lobbenberg here from HSBC. I think already today, we've heard a lot of interest in the room about understanding how sustainable the changed social environment is. Is there a role there for extended contracts, which I think was something you used in Air Canada, or does that become impossible in the European context? And then a question on Transavia, if I may, and the growth of Transavia France, you're announcing Montpellier today and you're talking about potential to go into other French provincial airports. But in terms of the competitive environment operating out of Ollie is magical and slot constrained, whereas in the French provinces, you're going against the Palmeil of have every bloom in low cost carrier there is in Europe, including some who weren't there very recently. So how is that not going to be detrimental to your margin at Transavia going in to head butting fights in the provinces. Okay. 2, 2 very good questions. The first one, what, we managed to achieve air Canada in terms of, coming to, just 3 10 year agreements with pilots, cabin crew and ground, these were actually not 10 year agreements. They were 3 year agreements that automatically renewed of certain, metrics, were met. And it was the pilots who drove it, at our calendar once we had the agreement there on the pilot side they really set a great example for the rest of the team on ensuring that alignment was the only way to move forward. And if you, if you look at the market share or the market, valuation of Air Canada today, it went from $300,000,000 to $12,000,000,000, in the space of 10 years very happy with that here in Europe in particular, France, there's no expectation when we want to get a 10 year deal with the pilots here. But I think full alignment, especially with the largest pilot union and hopefully with all three unions we have at El France, we believe we can achieve the pilots here, as I said when I first started, are unbelievably passionate, totally, totally in love with with the brand of France. Do want to see it regain its position within the group and within Europe as one of the best So I think we'll have to do it in more innovative ways, in a different way than, what my experience has in the past. But, I think it's the same, you know, the same base, characteristics and what I witnessed, in my previous role was if you can get, trust respect, transparency and do it in a confidential way, we are already totally aligned with, all the staff, both, both major airlines. And in particular, El France, you know, who see the margin where it is, see the fact there hasn't been growth, see the fact that, you know, we have over 100 competitors at both, Paris airports, that they see that the, you know, the business is going elsewhere. On your second point, So at all Lee, with the, with the redesign of the HOP operation, so with the removal of the most inefficient aircraft types. And with the ability now to grow Transavia, we have some clear, I think, low risk plans that should definitely drive, margin. In the secondary cities, even though access is available to our competitors and they're already are quite a few that are, you know, have big operations there. What we have, that they don't have is for the customer base that's, you know, in France, a lot of them fly, Alfrance or KLM today and are flying blue members. This is a unique advantage that we have over the competitors, in those secondary cities. And we will better use the ability, to leverage that tool as we grow Transavia France. It's James Holland from Exane BNP Paribas. 2 for me, please. I just find it very interesting that Transavia France margin is higher than that in the Netherlands. I was wondering what could be learned from that as clearly you try and bridge that delta to the best you can within the Air France versus KLM in particular. And indeed what might be learnt from improving the margin in Transavia Netherlands? And then sort of back to that previous point, I think the Well, I certainly would like an update on the next negotiations particularly with the Air France pilots. For me, it's fairly binary as to whether this this new strategy works whether you have that buy in? And clearly, I'm not going to sit here and say you haven't done a good job of getting that buy in so far. But as far as I can tell that the deal ends pretty soon, it was kind of a stop gap deal, which now we need to look the next 2, 3 year period, ideally next 5 year period. It's running where we are in the negotiations. Obviously, we've seen BA people saying, we want massive profit shares because we had to take the pain when times were tougher. I don't think anyone would say Air France hadn't been through that as well. Maybe just a broad update or specifically where we are in negotiations. Thank you. Okay. So I mean, perhaps I'll let Peter answer the first part on Transavia Netherlands, and how it's managed slightly different from a different perspective in terms of slot slot optimization in Amsterdam and how that the balance of, of earnings gets looked in a different way as opposed to Transavia France. If we look to the operation of Transavia and the Netherlands, as I shared on my slide, they are operating out of Amsterdam, Eindhoven and Rotterdam in the Far majority of the operation is out of Amsterdam. 28 out of the 40 aircraft is Amsterdam. The other 889 are from Rotter M and I, though, respectively, we look to the overall yield situation, that's obviously a little bit better in Amsterdam than outside Amsterdam. I think the results between Transavia and France Transavia, the Netherlands are pretty similar, maybe 1% margin difference or something like that, but pretty, pretty similar. And I guess are more driven by route network sort of individual routes optimized rather than a very structural differentiation. They use the same aircraft types. They have a very pretty similar pretty similar utilization, similar structure, a lot of sort of back offices are completely aligned. If we look to a place like Porto, which is served out of both only and Amsterdam, it's a completely sort of shared resources. So I think it's pretty similar and I know Nathalie, if I forget a very important topic, but I would say it's pretty similar there. Okay. Your second question about, the next contract with pilots. So the tough negotiation we had over the last year ensuring we get as much alignment as possible for the NLO that covered for the pilots 2018 2019. We've already pre negotiated 2020. So it's done, well ahead of the deadline. Hi, Carolina Torres from Morgan Stanley. I guess you run through it that you're comfortable with your negotiations with employees. So I guess in your opinion then what is the main challenge of your delivering this plan? And I guess my second question is when we look into because you're giving a very long term path to 2024. And in Air France, we've got a few bit of hints about to think about it. So if my math is right, I refer to seeing EBIT improvements of around 150,000,000 per year for the initial years and then it accelerates into 2024. So yeah, we gave a, you know, for the mid cycle, a large target there, 7% to 9% to 7% to 8% operating in a very half of the business, more than half of the business operating in a very expensive environment here in France. As I said, we are lobbying very hard to lower the, or create a 1 level playing field. We're not counting on that. But many people ask us, why can we not get the Air France business to the same margin levels of KLM or even others? This is a big challenge for us. So the to grow from the margin that Alfons is at today up to the margin that we are targeting is doable. We believe it's doable, but it is not possible at El France without alignment with staff. If you go back last 6, 7 years, over 1,000,000,000, you know, in cost for strikes, and not having alignment to a strategy, going forward with something like this, as Frederic mentioned, if we do not have, alignment with the Elfron staff, which I think if you've seen over the last year, I think is, I mean, it surprised everybody at LCOS. We're really proud of what we've been able to accomplish. Now We have stability. You cannot reverse, many, many years of lack of trust, but based on what's been able, was been achieved over the last year. We're on a great momentum and I think we'll be able to continue it. So your specific question about how much can we realize each year We are spreading it out evenly over the 5 year period here and obviously going to move as quickly as we can. Hi, Ben. And Stephen Furlong from Davy Research. You talked about competition and for the plan, did you look at the underlying apply or demand, capacity additions of competitors that you've done before out to 2024. And then the other thing, just on in terms of consolidation, I was wondering, because you mentioned that North America is obviously more consolidated in Europe. Do you think would you look at your net debt to EBITDA target and that's 6% or an opportunity arose we prepared to raise that? Or is really Air France CalM taking part significantly or meaningfully in consolidation? Maybe it's down the road 2024 or beyond that? Thank you. So certainly the consolidation 1, Look, where it makes financial sense and strategically, where it makes sense, we will participate, you know, transavia lifting of the cap, it's, you know, it's not consolidation, but it's a, it's a great tool. For us, to do things that we couldn't do in the past. And as I said with FlyingBlue is a great platform with all lead being slot constrained. We have, an incredible opportunity there. The fact that Amsterdam, is a lot constrained does provide an unbelievable opportunity for quality of revenue improvement. As you said, so for the supply and demand, impact on Air France KLM, because of the well diversified networks that we have, and especially on the Elphon side, with the new flexibility we have to go after the markets where we make money, the diversification and the opportunities that were not in place before position the group in a much stronger way to be able to weather the ups and downs as opposed to be straightjacket locked into a certain way of doing business. So I think we're in a much more flexible position, not only in terms of being able to take advantage of connections or more origin and destination traffic, but with the new configurations we're putting in place, within the group and especially with the overhaul of the fleet at Alfons to be able to alter the size of the business cabin, larger or smaller without having to go through lengthy negotiations, the way we're positioning all the monuments onboard the aircraft and being done in a way that we can quickly change the size of each one of those cabins gives us more flexibility that we didn't have in the past. Hi. Savi Syth from Raymond James here. First question is on the kind of going after more local traffic with Air France. Just curious is do you capture that by up gauging and kind of keeping your connecting traffic or is there kind of a change in strategy on how you deal with the connecting traffic? And the second question on the margin, I don't want to it's a good margin for KLM the target, but kind of curious if what keeps you from maybe trying to achieve a kind of low to mid teen margin that you see some other carriers achieving And a little bit tied to that. I'm curious why the Transavia Netherlands versus France doesn't have that 2 to 2.5 point difference in margin that you see in between Air France and KLM. Okay. So on the, on the traffic mix, specifically for Al France. A big portion of that is, as I mentioned in the first part of the presentation, was not available because of, I mean, believe it or not, contract restrictions, you know, it's to position the airline like the airplane types or A380s getting rid of those airplanes. The way the interiors were configured made it very, very difficult to fly a schedule that was optimal for local traffic because you're designing the banks around filling up the A380s, not having the right cabins to go after you know, the local segments where it made sense. So a lot of restrictions around laying out, the fleet and the network to optimize the types of flows where Alpha Constant does best. And this, you know, being in this business for 30 years, when I arrived here looking at all of the constraints that were in place, I mean, we couldn't move. I mean, we still have some constraints, but to be able to like step by step by step, go through each one, ensure that the social partners that have an impact on that. Understand that there is a positive, opportunity that's created by Evolving these contracts, is what's driving our view and our target to be able to shift to those more profitable segments. The second part of the question is a very good one. The first one was good also, but the second one is But there is many explanation. First, for example, there is not domestic network, Air France had and Karimas note, yes? 2nd, there is also the fact that Transavia is a younger company in France than in Holland. Transavia France has been created in 2007 and in Holland. 51 years ago. 51. So which means that all the legacy argument, which means that you lose a bit in terms of efficiency, people are a bit older. And a bit higher in the scale of revenue at Zatara that ARR is explaining the fact that when you compare today Transavia France and Transavia alum, it's true that during the last 2 years, the profitability was exactly the same, around 9 point something percent. Is not true in 2019 where Transavia France is a bit below Transavia Long, but it's due for the problem of in operations. Met by Transavia France during the summer. But clearly, it is an initiative that it is not only the environment but also the history of each company. And it is also the motivations that even in France, you can have a low cost, working not so bad with the margin equivalent to her dot sister. Hi, it's Jamie Robotham from Deutsche Bank. Two questions from me here. I'm just just here. Two questions from me. The first relates to the domestic network restructuring and the new all lease strategy, which are clearly related and seem to represent an important part of the building block. Alongside the removal of some loss making regional services and the scope for additional hopefully profitable Transavia France services, there was I think a third element mentioned, which was for Air France to offer medium haul business orientated services to places like Madrid. Is there a specific figure within the bridge you'd attach to that opportunity? And who will you be competing with there and will you be freeing up any slots at Charles De Gaul, for example? And then the second question, Ben, are there any restrictions still in place in terms of the industrial agreements, which if removed or altered could give you even more commercial flexibility? Or are you completely done on that front? Yes. On the new business that you wanted, European destination that will open and the first one is Madrid next summer. I think it's not the same initiative that we've done in the past. From we have launched European destination, but it was more in the middle of the day, not targeting business customers. So this one is really targeting business customers with very good frequencies, very good timings for business customers. Of course, we can use valued slots from Olli. And we also want to highlight the fact that Ollie is a very convenient, is transformed to a very convenient airport that many that the area around Ollie is a much wealthy area. And that the region people oftenly prefer to go directly to our airport. It will be linked quite conveniently to Paris with a Metro line with the station of Massey, if you know it, to the high speed train. So we think that the refurbishment of Olli offers really good opportunities and that we don't want to compete with a Charzago network. So we will choose some destination where the frequencies we have in Charzago are already high. And we will just add up this kind of route for the convenience of the customers that will prefer only. And the other question that you asked regarding additional, removal or evolution of the contracts that we have in place, there's an enormous amount, that's, in front of us. I'll just give you a few examples. So at the airports, our ground staff, the rostering system that is not efficient, lot of work going on there. Pilots, the training plan is probably one of the longest, if not the longest in the world. The productivity of our pilots because of the types of programs we have in place. A lot of the rules around how we roster our pilots and the cabin crew at El France are also very, very restrictive. And in a lot of cases do not benefit, our staff either these are just a few examples of the many, many examples that we've got to make, you know, Alfons more efficient and I'll let Peter talk about KLM there, from that front. But I do want to say that the most important ones you know, being able to remove that ASK metric or evolve that ASK metric is part of the production balance at FHAS. Was so necessary in order to make the right fleet decisions and ensure we can configure the airplanes correctly because if you saw in the presentation, the value that comes out of that, to be able to buy the airplane, it makes more sense And if you look the timing is amazing right now, if you look at wide body airplanes, the market price from last year is down 30% we couldn't have we couldn't be in a better environment to replace the airplanes. The fact that we had not overhauled the interiors of the A380s So to get this aligned at this point, was really key. Now not to discount the other, you know, options and opportunities for us and in evolving the contracts, but that was the number one item we wanted to get through. So Michael Kuhn from Societe Generale. 2, basically, follow ups, one more on Kevin as it is such an important topic What do you think is the current, let's say, financial disadvantage of operating suboptimal, Kevin Lay, how it's And until when do you expect, let's say, to fix that issue? And that said, what profit uplift do you expect from that, let's say, isolated measure to be able to, let's say, operate tailor made to the right destinations. So that's the first one. And secondly, on lobbying efforts, again, I mean, clearly, this is not a new topic, and I think also your predecessors have often complained about the disadvantage of the operating environment in France and still for example, into next year, we will see a new ecotex as an additional burden for your operation here. So it seems there's lots of headwinds against the industry and it's not really in a good lobbying position right now. So what do you think can change there going forward? And in which areas do you expect to get some progress? On improving your operating environment from a political perspective? Thank you. So this I'll answer the second question first. I think the fact that we have stability, on the social side at El France, puts us in a much more credible position, when it comes to lobbying with the French government, when Alfrance has been in crisis and focused on daily fires, the ability to go to the French government and push an agenda on the value of better supporting or creating a more level playing field in France has been would have been much more challenging than we are in today. So that is a that's a big change. So, you know, the, the reception we're getting, you know, although it hasn't produced, the type of change that we would like or to the level that we'd like, the interest and, you know, desire to understand what it, is going to take to get our friends to produce and perform at a higher level is there from the government from our government partners. On your first question, and it's don't want to take up too much time on that because it's a very lengthy answer. So I'll try I'll try to compile it into the few key points. Over half of the Alpha loss fleet today, has uncompetitive products. And what I mean by that is, you know, if you look at the A380s, if you look at Half of the 777 Fleet, we do not have even the basic lie flat product, which all major international carriers plot into and out of France have. So there's a massive effort to go forward on that as quickly as possible. You know, we have 12,000,000,000,000 dollars, $300,000,000 that fly some of the most important routes out of Paris. That still have the old product. Of course, the A380 is the same. We're almost finished with the A330, So the cabin configuration and getting that standardized in order to, to ensure the value proposition is well understood and can be counted on will drive improved margins, you know, just so on our five flights of data JFK today, one at Availi and 4 out of OSC, know, we have 3 different types of, seed. So if you're trying to switch, a business class seed on, on that route there, you're not going to be happy if you go from an expectation of flat seed to one that's on an angle and we risk losing those customers or, these customers are not satisfied because of something, as basic as that. So getting the, the product consistent, making sure it's positioned correctly, this is why you've seen, you know, the removal of the brand, Hop and the removal of the brand, of June. And as Anne described, the introduction of business class, in domestic France because we do derive a lot of profitable, long haul premium cabin revenue out of domestic France to ensure that that is a end to end product. And we do have a lot of business customers flying on the Medet routes. You know, so the hourly routes we have at Evolites and knees to Marseille be entered to lose. These, these routes are still, of the domestic routes that we fly, are the strongest ones. So I would say consistency is, is necessary. None of them are not unique to Alfrance. All of you fly long haul, I'm sure and you're not happy if the product is not what you expected. This is an issue we have today because we have a lot of customers who will either shift it from our files or who are not satisfied with the product? So financially, as I said, when you look at the market share loss and we see many of our customers that, have shifted away from Alfrance, the quality of revenue in the business cabin, we've attached, we've attached a target And you see that the million as a breakdown that Anne is showing basically to configuration and to to, simplification. We have done that on the assumption that yields remains flat. So the all that would be upside, as we are able to increase the, the value of the revenue or the improvement in the revenue production. Maybe to complete, to add Lens to a long answer, we're currently refurbishing our 30, 15 aircraft next year, our 777 that this serves a leisure market, until that, etcetera, 12 aircraft. And the year after, we will refurbish the 777 that are with a better revenue on the overall aircraft. Because you use more of the space, the overall space on the aircraft. So that's why it's bringing benefits to the million. And maybe just one last point, even though it's taking a long time of longer than we would like to renovate these airplanes, every month, and you'll see by next summer, on the key routes to Asia and to North America, unless the route, if the route only has 1 flight a day, it will be operated with a product that's been renovated. We will we are isolating the aircraft that are still in an old configuration on routes where there is no competition or where Alfrance operates multiple flights a day. So at least there is a choice, a product so that we can try to steer the lower yielding revenue to the flights where we don't have the latest product offering and some of the other traffic that is less valuable to that. So we are moving quickly, but we are trying to ensure that our best products are on the best route. Yes. And at the same time since we exit the 3 40, we exit the 380. When you make the math, it's 80% of the fleet that will be at the highest standards next year. Since now one, thank you very much for coming. I think we can now close this formal Q And A session. And of course, we will come you for the lunch where you will have the opportunity to further exchange. We are CEO committee and with the group executive committee members that then introduced earlier this morning. Thank you very much for coming.

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