KLM Royal Dutch Airlines is an international airline operating worldwide. Its home base is Amsterdam Airport Schiphol, one of the most modern airports in the world. KLM forms the core of KLM Group, other members being KLM cityhopper and Transavia. Through close cooperation with European and intercontinental network and route partners, KLM Group offers passengers and airfreight shippers more than 132,000 city-pair connections throughout the world directly or via one or more airports. KLM Group has four core activities: passenger transport, cargo transport, airframe, engine and component maintenance and the operation of charters and low fare scheduled services. These activities are performed by the Passenger Business, Cargo Business, Engineering & Maintenance Business and Charter/Low Cost Business respectively. KLM Group and its partners serve more than 400 cities in 85 countries on six continents. In fiscal year 2003/2004, KLM Group carried more than 23 million passengers and 529,000 tons of cargo, and provided engineering and maintenance services to more than 20 airlines. Measured by international revenue ton-kilometers, KLM ranks sixth among the 270-plus members of the International Air Transport Association (IATA). KLM Group operates a modern fleet of 188 aircraft. The number of KLM Group's employees as of March 31, 2004 was 34,529, of whom 30,367 were employed in The Netherlands and 4,162 abroad. KLM's goal is to be a first choice passenger and cargo airline and provider of maintenance services, while consistently enhancing shareholder value. KLM also wishes to offer a stimulating and dynamic working environment for staff, to participate in mutually beneficial relationships with its partners and to maintain a good relationship with its other stakeholders. In the course of fiscal year 2004/2005, KLM will join forces with Air France and become a member of SkyTeam, a global alliance in which several important European, American and Asian airlines have joined forces (including Air France, Alitalia, Delta Air Lines and Korean Air). Northwest Airlines, with which KLM has had a strong transatlantic alliance for more than ten years, and Continental Airlines will join SkyTeam at the same time. As a member of SkyTeam, KLM will gain the position it seeks of being a key player in a global alliance that commands an important position in the world's three major economic areas: America, Europe and Asia. KLM - with its partner Kenya Airways - and Air France, moreover, both have a strong position in Africa. KLM is aware of its influence on people, society and the environment and seeks to balance the Company's interests with those of the broader society. The high profile of the aviation industry, the involvement of a large number of stakeholders and the political implications of local and global issues make it essential to strike the right balance between the various interests. To KLM, sustainability is a pre-condition for it to retain the support it needs to realize its business objectives. Operating income for 2003/2004 amounted to EUR 120 million and net income to EUR 24 million. KLM shares are listed on the Amsterdam and New York stock exchanges. These listings are expected to be cancelled after the combination of KLM and Air France and the related share transactions are effected. Air France/KLM shares will be listed in Amsterdam, Paris and New York.
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