Air France-KLM, the Franco-Dutch airline, says it made a big loss in 2012, blaming sharply rising fuel costs and trouble with its cargo business.
Net losses increased 47% to 1.19bn euros (£1bn; $1.57bn), after a 471m-euro restructuring charge and a 890m-euro increase in its fuel bill.
But operating losses fell to 300m euros, from 353m euros the year before.
Revenues rose 5.2% to 25.6bn euros, thanks in part to increased prices on its North Atlantic routes.
Debt fell from 6.51bn to 5.97bn euros after sell-offs and spending cuts – the company plans to reduce its net debt by 2bn euros by the end of 2014.
Chief executive Jean-Cyril Spinetta said in a statement: “The year 2012 was characterised by a slowdown in global growth and recession in Europe, but nevertheless saw a sharp increase in the fuel price.
“In 2013, we will maintain strict discipline in terms of capacity management, investments and costs.”
Air France-KLM is renegotiating pay and conditions with its staff and cutting more than 5,000 jobs, as high fuel costs and competition from low-cost airlines take their toll on the debt-laden company.
The airline managed to increase filled capacity on its flights to more than 83% as demand for long-haul trips rose, but its cargo business continues to struggle