Fuel costs hit Air France profits

Air France-KLM has increased fares to counter rising costs

Rising fuel prices and slowing economic growth have hit quarterly profits at airline Air France-KLM.

Net profits for the April to June period were down nearly 60% from a year ago to 168m euros ($261m; £133m).

Passenger numbers rose 3.7% in the quarter compared with a year earlier, even though the airline raised fares to counter higher costs.

Many airlines are cutting routes and increasing fares, and predict tougher times ahead for the industry.

A report by the International Air Travel Association (IATA) released on Monday warned that the situation would get "a lot worse", and that the industry could see losses of $6.1bn (£3bn) this year.

Last week, British Airways said the airline faced the "worst trading environment ever," as it reported a 88% fall in pre-tax quarterly profit for the three months to June.

And budget carrier Ryanair recently warned it could see an annual loss of up to 60m euros.

Last month, Air France said it was in talks about a possible joint-venture with French utility firm Veolia to operate several rail services, a move that analysts say could help the airline reduce costs.