Overcapacity and weak cargo demand have forced Air France-KLM to shave up to €300 million ($408 million) from its 2014 EBITDA forecast.

Air France-KLM originally forecast a full-year EBITDA of €2.5 billion, but it has now lowered this outlook to between €2.2 billion and €2.3 billion. However, it noted the revised forecast is still 20% more than its 2013 results.

In June, Air France-KLM carried 7.2 million passengers, up 3.9% compared with June 2013. A 1.8% increase in capacity was met by 2.9% traffic growth, pushing its load factor up by a 0.9 percentage point to 86.2%. Unit revenues remained stable. However, cargo traffic slipped 4.3%, exceeding a 1.7% capacity reduction, pushing Air France-KLM’s average cargo load factor down 1.6 points to 60.7%.

“While not representing a turning point in market trends, June traffic figures, as well as bookings for July and August, nevertheless reflect the overcapacity on certain long-haul routes—notably North America and Asia—with the attendant impact on yields. This comes on top of the persistently weak cargo demand and the challenging situation in Venezuela identified in the first quarter,” Air France-KLM said in a statement.

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