KLM's net profits before exceptional items, fell in the first quarter by 63.67 per cent to 77 million guilder (€34.94 million) from 212 million guilder in the first quarter of last year, the Dutch airline reported. However, it said overall net profits in the first quarter had surged to 975 million guilder from 212 million guilder owing to net capital gain of 898 million guilder in spring from the sale of shares in the seat reservation system Galileo International.

The board warned that it did not expect profits to increase much during the rest of the year. "On the basis of forecasts, operating profits in this accounting year will be far less than the figure last year." In 1998-99, KLM made an overall net profit of 456 million guilder, 24.3 per cent less than the figure for the previous year. Operating revenues of 3.429 billion guilders for the three months ended on June 30th were only slightly lower than the 3.440 billion guilders for the same period last year, but KLM said operating costs increased 3 per cent to 3.262 billion guilders.