3 May 2019

FIRST QUARTER 2019 RESULTS

Unit revenue pressure as anticipated, operational performance improvement

FIRST QUARTER 2019

  • Passenger growth +3% and load factor -0.3 point.
  • Unit revenue down -1.9% due to Easter shift and substantial industry capacity growth in the winter.
  • Unit costs decrease by -0.4% at constant currency and fuel.
  • Operating result at -303 million euros, with unit cost improvement more than offset by unit revenue, fuel bill and currency headwinds.
  • Further reduction in Group net debt, down 403 million euros to 5.8 billion euros and Net debt/EBITDA ratio at 1.4x stable compared to 31 December 2018.

OUTLOOK 2019

  • Long Haul industry capacity to / from Europe for the summer 2019 is projected to grow at a slower pace compared to last year, particularly to Middle East, North America and Asia.
  • Based on current data for Passenger network:
    • Long-haul forward booking load factors from May to September are on average ahead compared to last year.
    • Network passenger unit revenues at constant currency expected to slightly improve compared to last year for the second quarter 2019, with positive long haul unit revenues largely offset by negative point-to-point unit revenues.
  • Full year guidance confirmed:
    • Unit cost (CASK) reduction between -1% and 0% at constant currency and fuel price,
    • Net debt/EBITDA ratio below 1.5x.

Benjamin Smith, Air France-KLM Group CEO said: “As anticipated, the first quarter has been challenging for the European airline industry including the Air France-KLM Group, as substantial industry capacity growth in the off-peak business period led to unit revenue pressure. In this context, the Group achieved further improvement in unit cost while reaping the benefits of its efforts to strengthen its positioning, as evidenced by the first signs of progress in operational performance at Air France, notably in term of “Net Promoter Score” and punctuality. These elements, together with a more benign industry supply outlook for the summer, lead us to expect improving trends in the rest of the year and to confirm our full-year guidance. We aim to have a capital market day planned in November 2019 to further outline the Group strategic directions.”

Air France-KLM GroupFirst quarter
2019Change
Passengers (thousands)22,674+3.0%
Passenger Unit revenue per ASK1 (€ cts) 6.17-1.9%
Operating result (€m)-303-185
Net income – Group part (€m)-320-51
Adj. operating free cash flow (€m)241+99
Net debt at end of period (€m)5,761-403

 First quarter 2019 business review 

Network: Operating result impacted by unit revenue pressure and fuel bill increase

NetworkFirst quarter
2019ChangeChange
constant currency
Capacity (ASK m)69,759+2.3% 
Total revenues (€m)5,175+1.7%+1.0%
Scheduled revenues (€m)4,893+1.2%+0.4%
Operating result (€m)-279-193-146

First quarter 2019 combined Passenger and Cargo revenues increased by 1.0% at constant currency to 5.2 billion euros, for a capacity growth of 2.3%. The operating result amounted to -279 million euros, a 146 million euros decrease at constant currency compared to last year, mostly due to unit revenue pressure and fuel bill increase as anticipated.

Passenger network: Resilient unit revenues for long-haul and premium and decline in short- and medium-haul

 First quarter
Passenger network2019ChangeChange
constant currency
Passengers (thousands)19,745+2.4% 
Capacity (ASK m)69,759+2.3% 
Traffic (RPK m) 60,221+1.9% 
Load factor  86.3%-0.4 pt 
Total passenger revenues (€m)4,628+1.8%+1.3%
Scheduled passenger revenues (€m)4,420+1.4%+0.7%
Unit revenue per ASK (€ cts) 6.34-0.9%-1.6%

First quarter 2019 capacity increased by 2.3%, mainly driven by the South American, North Atlantic and Asian networks with respective growth of 9.8%, 5.3% and 1.8%.

The passenger network experienced a supply – demand imbalance putting pressure on unit revenues. Revenue management anticipated to price competitive trends in the market and managed to contain impact on unit revenues to -1.6% at constant currency compared to last year.

  • The North America network experienced competitive pricing sensitivity and posted a 2.5% unit revenue decrease, but after a strong unit revenue performance in the previous year (+4.9%).
  • The 9.8% additional capacity on South America was driven by growth on the Andean routes and the opening of the Fortaleza service in April 2018. Ongoing pressure persists due to economic difficulties in Argentina and the international demand recovery of the Brazilian market progressing slower than anticipated.
  • The Asian network’s solid performance trend continues, with first quarter unit revenue up 1.7%, driven in particular by the Japanese network.
  • Caribbean & Indian Ocean network posted a strong result with unit revenues of +4.3%, driven by strong leisure demand.
  • Africa & Middle East network was relatively stable compared to last year.
  • The medium-haul network saw a unit revenue decrease of 2.4%, due to substantial intra-European industry capacity growth.

Cargo network: Unit revenues impacted by slowdown of air freight market

 First quarter
Cargo network 2019ChangeChange
constant currency
Tons (thousands)270+0.0% 
Capacity (ATK m)3,462+1.4% 
Traffic (RTK m) 2,046+0.5% 
Load factor  59.1%-0.5 pt 
Total Cargo revenues (€m)547+0.7%-1.3%
Scheduled cargo revenues (€m)473-0.8%-2.8%
Unit revenue per ATK (€ cts ) 13.67-2.0%-4.0%

A slowdown of volumes in the first quarter is visible in the whole air freight market, due to economic slowdown, political uncertainties and trade disputes. This has put pressure on freight rates, resulting in a unit revenue development of -4.0% at constant currency. Several network rationalization measures have been implemented during the quarter to counterbalance the negative trend. A slight capacity increase has been offset by this unit revenue decrease, resulting in a decline of revenues by 1.3% at constant currency.

Transavia: Strong capacity growth, but unit revenue decline primarily explained by Easter shift

 First quarter
Transavia2019Change
Passengers (thousands)2,929+7.4%
Capacity (ASK m)5,826+11.4%
Traffic (RPK m) 5,368+11.7%
Load factor  92.1%+0.2 pt
Total passenger revenues (€m)249+6.0%
Unit revenue per ASK (€ cts) 4.15-3.5%
Unit cost per ASK (€ cts)5.37-0.8%
Operating result (€m)-71-13

First quarter 2019 saw the launch of several new routes and a strong capacity growth of 11.4%. Unit revenues decreased by 3.5% compared to last year, primarily explained by Easter shift and an increase of stage length of the route network. The unit cost improved with -0.8% and -1.7% at constant fuel and currency.
The first quarter 2019 operating result stood at -71 million euros, 13 million euros lower compared to last year.

Maintenance: Strong third party revenue growth and margin improvement

 First quarter
Maintenance2019ChangeChange
constant currency
Total revenues (€m)1,170+8.7% 
Third party revenues (€m)554+17.6%+9.9%
Operating result  (€m)472016
Operating margin (%)4.0%+1.5 pt+1.3 pt

Maintenance revenues increased compared to last year with third-party revenues up by 9.9% at constant currency, a continuation of the growth trend realized by the inflow of new contracts. The Maintenance order book stood at 11.5 billion dollars at 31 March 2019, an increase of 0.1 billion dollars compared to 31 December 2018.
The operating margin expressed as a percentage of total revenues stood at 4.0%, an increase of 1.3 point at constant currency compared to last year, explained by the focus on margin quality in both engine and component businesses.

Air France-KLM Group: Unit cost improvement more than offset by unit revenue, fuel and currency headwinds

 First quarter
 2019ChangeChange
constant currency
Capacity (ASK m)75,586+3.0% 
Traffic (RPK m)65,589+2.6% 
Passenger unit revenue per ASK (€ cts)   6.17 -1.2%-1.9%
Group unit revenue per ASK (€ cts)   6.79 -1.4%-2.2%
Group unit cost per ASK (€ cts) at constant fuel  7.19 +1.2%-0.4%
Revenues (€m)5,986+3.1%+2.0%
EBITDA (€m)424-31.7%-26.3%
Operating result (€m)-303-185-142
Operating margin (%)-5.1%-3.0 pt-2.3 pt
Net income - Group part (€m)-320-51 

In the first quarter 2019, the Air France-KLM Group posted an operating result of -303 million euros, down 185 million euros compared to last year, which was impacted by the Air France strike for -75 million euros.

The unit revenue at constant currency of -2.2% compared to last year had a negative impact of 115 million euros on the operating result.
The fuel bill including hedging amounted to 1,201 million euros for first quarter 2019, up 140 million euros, of which 44 million euros is explained by an increase in the fuel price and a volume effect of 34 million euros for the capacity increase compared to last year. The result of the fuel hedges has been a gain of 35 million euros.

Currencies had a positive 65 million euro impact on revenues and a negative 108 million euro effect on costs including currency hedging. The net impact of currencies thus amounted to a negative 43 million euros for first quarter 2019.

Unit costs in line with full year guidance
On a constant currency and fuel price basis, unit costs were down -0.4% in the first quarter 2019, driven in particular by the decrease in customer compensations compared to first quarter 2018 that was marked by the strikes in Air France
However this was partly offset by KLM unit cost which were impacted by a 1.3% lower than planned capacity due to weather and technical reasons.
Net employee costs were up 6.4% in the quarter compared to last year, explained by additional hirings for the capacity growth, the impact of the implemented wage agreements for Air France and KLM staff and the last year strike effect.
Compared to last year, the average number of FTEs increased by 1,050, including +450 Pilots and +50 Cabin Crew in response to the capacity growth. However, productivity measured in ASK per FTE increased by 1.7% in the first quarter 2019 while capacity increased by 3.0%.

Positive operating free cash flow and net debt reduction

 First quarter
In € million2019Change
Cash flow before change in WCR and Voluntary Departure Plans, continuing operations 368-144
Cash out related to Voluntary Departure Plans -4+18
Change in Working Capital Requirement (WCR) 806-1
Net cash flow from operating activities 1,170-127
Net investments before sale & lease-back*-678+235
Operating free cash flow 492+108
Reduction of lease debt-251-9
Adjusted operating free cash flow **24199

* Sum ofPurchase of property, plant and equipment and intangible assets’ and ‘Proceeds on disposal of property, plant and equipment and intangible assets’ as presented in the consolidated cash flow statement.
** The “Adjusted operating free cash” is operating free cash flow with deduction of the repayment of lease debt.

Adjusted operating free cash flow positive
The Group generated positive adjusted operating free cash flow of 241 million euros, an increase of 99 million euros compared to last year, mainly explained by a lower capex in the first quarter 2019 due to  a year-over-year shift in investment timing pattern.

Leverage stable                   

In € million31 Mar 201931 Dec 2018
Net debt 5,7616,164
EBITDA trailing 12 months4,0204,217
Net debt/EBITDA trailing 12 months1.4x1.5x

The Group reduced its net debt to 5,761 million euros at 31 March 2019 versus 6,164 million euros at 31 December 2018. This 403 million euro reduction was driven by operating free cash flow generation and the repayment of lease debt.
The net debt/EBITDA ratio stood at 1.4x at 31 March 2019, a decrease of 0.03 point compared to 31 December 2018, explained by the reduction of the net debt.

Both airlines impacted by unit revenue pressure and fuel bill increase

 First quarter
 2019Change
Air France Group   
Operating result (€m)-256-78
Operating margin (%)-6.9%-1.9 pt
KLM Group  
Operating result (€m)-56-116
Operating margin (%)-2.3%-4.5 pt

 Outlook

The global context remains uncertain given the current geopolitical environment and fuel price trends.
For the full year 2019, the Air France-KLM Group plans to selectively grow capacity for the Passenger network by 2% to 3% compared to 2018. Transavia will continue to grow at a sustained pace of 9% to 11%.

Long Haul industry capacity to / from Europe for the summer 2019 is projected to grow at a slower pace compared to last year, particularly to Middle East, North America and Asia.
Based on the current data for the Passenger network:

  • Long-haul forward booking load factors from May to September are on average ahead compared to last year.
  • Network passenger unit revenues at constant currency expected to slightly improve compared to last year for the second quarter 2019, with positive long haul unit revenues largely offset by negative point-to-point unit revenues.                                                                              

Full year guidance confirmed:

  • The Group will pursue initiatives to reduce unit costs1, with a targeted reduction for 2019 of between -1% to 0% at constant currency and fuel price.
  • The 2019 fuel bill is expected to increase by 650 million euros compared to 2018 to 5.6 billion euros2, based on the forward curve of 26 April 2019.
  • The Group’s capital expenditures are planned at the level of 3.2 billion euros for the year 2019 and the Group is targeting a Net debt/EBITDA ratio below 1.5x.

*****

The first Quarter 2019 accounts are not audited by the Statutory Auditors.

The results presentation is available at www.airfranceklm.com on 3 May 2019 from 7:15 am CET.

A conference call hosted by Mr Gagey (CFO) will be held on 3 May 2019 at 08.30.

To connect to the conference call, please dial:

France: Local +33 (0)1 76 77 22 57
Netherlands: Local +31 (0)20 703 8261 
UK: Local +44 (0)330 336 9411
US: Local +1 720-543-0206

Confirmation code: 3069097

To listen to the audio-replay of the conference call, please dial:

  • France: +33 (0) 1 70 48 00 94
  • Netherlands: +31 (0) 20 721 8903
  • US: +1 719-457-0820

Confirmation code: 3069097

Investor Relations                                                                                          Press
Marie-Agnès de Peslouan                   Wouter van Beek                                                       
+33 1 49 89 52 59                                 +33 1 49 89 52 60                                 +33 1 41 56 56 00
madepeslouan@airfranceklm.com        Wouter-van.Beek@airfranceklm.com


Income Statement

 First quarter
In millions euros20192018Change
Sales5,9865,806+3.1%
Other revenues00-100.0%
Revenues5,9865,806+3.1%
Aircraft fuel-1,201-1,061+13.2%
Chartering costs-134-130+3.1%
Landing fees and en-route charges-434-427+1.6%
Catering-187-182+2.7%
Handling charges and other operating costs-454-476-4.6%
Aircraft maintenance costs-652-617+5.7%
Commercial and distribution costs-250-232+7.8%
Other external expenses -439-394+11.4%
Salaries and related costs-1,972-1,853+6.4%
Taxes other than income taxes-52-49+6.1%
Other income and expenses213236-9.7%
EBITDA424621-31.7%
Amortization, depreciation and provisions-727-739-1.6%
Income from current operations-303-118+156.8%
Sales of aircraft equipment13-4nm
Other non-current income and expenses5-43nm
Income from operating activities-285-165+72.7%
Cost of financial debt-106-114-7.0%
Income from cash and cash equivalent1210+20.0%
Net cost of financial debt-94-104-9.6%
Other financial income and expenses-7112nm
Income before tax-450-257+75.1%
Income taxes128-6nm
Net income of consolidated companies-322-263+22.4%
Share of profits (losses) of associates2-6nm
Income from continuing operations-320-269+19.0%
Net income from discontinued operations00N/A
Net income for the period-320-269+19.0%
Non-controlling interest00N/A
Net income for the period – Group part-320-269+19.0%


Consolidated Balance Sheet

Assets31 Mar 201931 Dec 2018
In million euros
Goodwill217217
Intangible assets1,2671,194
Flight equipment10,27910,165
Other property, plant and equipment1,5041,503
Right-of-use assets5,0515,243
Investments in equity associates306311
Pension assets533331
Other financial assets1,5421,487
Deferred tax assets520544
Other non-current assets301264
Total non-current assets21,52021,259
Assets held for sale00
Other short-term financial assets302325
Inventories686633
Trade receivables2,5922,191
Other current assets1,3221,062
Cash and cash equivalents4,1623,585
Total current assets9,0647,796
Total assets30,58429,055


Liabilities and equity31 Mar 201931 Dec 2018
In million euros
Issued capital429429
Additional paid-in capital4,1394,139
Treasury shares-67-67
Perpetual403403
Reserves and retained earnings-2,984-3,051
Equity attributable to equity holders of Air France-KLM1,9201,853
Non-controlling interests1312
Total Equity1,9331,865
Pension provisions2,1862,098
Return obligation liability and other provisions3,1263,035
Financial debt6,0145,733
Lease debt3,4263,546
Deferred tax liabilities484
Other non-current liabilities289459
Total non-current liabilities15,08914,875
Return obligation liability and other provisions509492
Current portion of financial debt815826
Current portion of lease debt989988
Trade payables2,4632,460
Deferred revenue on ticket sales4,2983,153
Frequent flyer program836844
Other current liabilities3,6163,547
Bank overdrafts365
Total current liabilities13,56212,315
Total equity and liabilities30,58429,055

Statement of consolidated Cash Flows from 1st January until 31st March 2019

In million euros31 Mar 201931 Mar 2018
Net income from continuing operations-320-269
Net income from discontinued operations00
Amortization, depreciation and operating provisions727739
Financial provisions4326
Loss (gain) on disposals of tangible and intangible assets-204
Loss (gain)on disposals of subsidiaries and associates00
Derivatives – non monetary result2713
Unrealized foreign exchange gains and losses, net64-24
Other non-monetary items-21-6
Share of (profits) losses of associates-26
Deferred taxes-1341
Financial Capacity364490
Of which discontinued operations00
(Increase) / decrease in inventories-60-13
(Increase) / decrease in trade receivables-399-310
Increase / (decrease) in trade payables-3464
Change in other receivables and payables1,2991,066
Change in working capital requirements806807
Change in working capital from discontinued operations00
Net cash flow from operating activities1,1701,297
Purchase of property, plant and equipment and intangible assets-718-939
Proceeds on disposal of property, plant and equipment and intangible assets4026
Proceeds on disposal of subsidiaries, of shares in non-controlled entities43
Acquisition of subsidiaries, of shares in non-controlled entities0-8
Dividends received33
Decrease (increase) in net investments, more than 3 months22-12
Net cash flow used in investing activities of discontinued operations00
Net cash flow used in investing activities-649-927
Increase of capital00
Perpetual (including premium)00
Issuance of debt50824
Repayment on financial debt-238-781
Payments on lease debt-251-242
Decrease (increase ) in loans, net-134
Dividends and coupons on perpetual paid00
Net cash flow used in financing activities of discontinued operations00
Net cash flow from financing activities18-965
Effect of exchange rate on cash and cash equivalents and bank overdrafts7-4
Effect of exch. rate on cash and cash eq. and bank overdrafts of disc. ops.00
Change in cash and cash equivalents and bank overdrafts546-599
Cash and cash equivalents and bank overdrafts at beginning of period3,5804,667
Cash and cash equivalents and bank overdrafts at end of period4,1264,068
Change in treasury of discontinued operations00

 Key Performance Indicators

EBITDA

 First quarter
In millions euros20192018
Income from current operations-303-118
Amortization, depreciation and provisions727739
EBITDA424621

Restated net income - Group part       

 First quarter
In million euros20192018
Net income - Group part -320-269
Net income from discontinued operations00
Unrealized foreign exchange gains and losses, net64-24
Change in fair value of financial assets and liabilities (derivatives) -2514
Non-current income and expenses -1847
Depreciation of shares available for sale -6-10
De-recognition of deferred tax assets 00
Restated net income - Group part-305-242
Coupons on perpetual-4-6
Restated net income - Group part, including coupons on perpetual (used to calculate earnings per share)-309-248
Restated net income per share (in €)-0.72-0.58

Return on capital employed (ROCE)1

In million euros31 Mar 201931 Mar 201831 Mar 201831 Mar 2017
Goodwill and intangible assets1,4851,3621,3621,320
Flight equipment10,27910,08410,0849,158
Other property, plant and equipment1,5041,4461,4461,382
Right of use assets5,0515,7695,7695,511
Investments in equity associates306290290295
Financial assets excluding shares available for sale, marketable securities and financial deposits136117117110
Provisions, excluding pension, cargo litigation and restructuring-3,249-2,726-2,726-2,719
WCR, excluding market value of derivatives-6,928-6,606-6,606-6,222
Capital employed 8,5849,7369,7368,835
Average capital employed (A)9,1609,286
Income from current operations1,1471,852
- Dividends received-2-3
- Share of profits (losses) of associates2311
- Normative income tax-347-553
Income from current operations after tax (B)8211,307
ROCE, trailing 12 months (B/A)9.0%14.1%

Net debt

 Balance sheet at
In million euros31 Mar 201931 Dec 2018
Financial debt6,4846,216
Lease debt4,3254,450
Financial assets pledged (OCEANE swap)00
Currency hedge on financial debt-57
Accrued interest-74-67
Gross financial debt (A)10,73010,606
Cash and cash equivalents4,1623,585
Marketable securities5174
Cash pledges265265
Deposits (bonds)527522
Bank overdrafts-36-5
Other01
Net cash (B)4,9694,442
Net debt (A) – (B)5,7616,164

Adjusted operating free cash flow

 First quarter
In million euros20192018
Net cash flow from operating activities, continued operations1,1701,297
Investment in property, plant, equipment and intangible assets-718-939
Proceeds on disposal of property, plant, equipment and intangible assets 4026
Operating free cash flow492384
Payments on lease debt-251-242
Adjusted operating free cash flow241142

Unit cost: net cost per ASK

 First quarter
 20192018
Revenues (in €m)5,9865,806
Income/(loss) from current operations (in €m)-303-118
Total operating expense (in €m)6,2895,924
Passenger network business – other revenues (in €m)-208-188
Cargo network business – other revenues (in €m)-73-67
Third-party revenues in the maintenance business (in €m)-554-471
Transavia - other revenues (in €m)-9-10
Third-party revenues of other businesses (in €m)-8-10
Net cost  (in €m)5,4375,178
Capacity produced, reported in ASK*75,58673,403
Net cost per ASK (in € cents per ASK)7.197.05
Gross change 2.0%
Currency effect on net costs (in €m) 83
Change at constant currency 0.4%
Fuel price effect (in €m) 44
Net cost per ASK on a constant currency and fuel price basis (in € cents per ASK)7.197.22
Change at constant currency and fuel price basis -0.4%

* The capacity produced by the transportation activities is combined by adding the capacity of the Passenger network (in ASK) to that of Transavia (in ASK).

Airline results

Air France GroupFirst quarter
 2019Change
Revenue (in €m)3,698+4.1%
EBITDA (in €m)204-91
Operating result (en m€)-256-78
Operating margin (%)-6.9%-1.9 pt
Operating cash flow before WCR and restructuring cash out (in €m)174-92
Operating cash flow (before WCR and restructuring) margin4.7%-2.8 pt


KLM Group


First quarter
 2019Change
Revenue (in €m)2,385-0.1%
EBITDA (in €m)208-107
Operating result (en m€)-56-116
Operating margin (%)-2.3%-4.5 pt
Operating cash flow before WCR and restructuring cash out (in €m)185-60
Operating cash flow (before WCR and restructuring) margin7.8%-2.5 pt

NB: Sum of individual airline results does not add up to Air France-KLM total due to intercompany eliminations at Group level


Group fleet at 31 March 2019

Aircraft typeAF
(incl. HOP)
KLM
(incl. KLC & MP)
TransaviaOwnedFinance  leaseOperating leaseTotalIn operationChange /  31/12/18
B747-400 11 11  1111 
B777-3004314 1223225757 
B777-2002515 241154040 
B787-9713 53122020 
A380-80010  1451010 
A340-3005  5  55-1
A330-300 5   555 
A330-200158 11 122323 
Total Long-Haul105660693171171171-1
B737-900 5 11355 
B737-800 2971291061100996
B737-700 17745152423-2
A32120  11 92020 
A32043  35354343 
A31933  20 133333-1
A31818  162 1818 
Total Medium-Haul114517884231362432413
ATR72-6006    665-1
ATR72-5001    11 -1
ATR42-5005  1 453-2
Canadair Jet 100014  14  1414 
Canadair Jet 70011  11  11102
Embraer 1901132 7142243431
Embraer 175 17 314 1717 
Embraer 17015  9151515 
Embraer 14518  144 1813 
Total Regional81490593338130120-1
B747-400ERF 3 3  33 
B747-400BCF 1 1  11 
B777-F2  2  22 
Total Cargo240600660
          
Total30217078218872455505381






1 Passenger unit revenue is the aggregate of Passenger network and Transavia unit revenues; change at constant currency



1 To align with industry practice, the metric EASK will not be used anymore as of 2019.
New Unit Cost definition will be: Net cost per Available Seat Kilometer at constant fuel and currency
The impact of this change for the unit cost is -0.1pt for 2019



2 Based on the forward curves of 26 April 2019 average Brent price of USD 69, average jet fuel price of USD 710 per ton including into plane costs. Assuming exchange rate of EUR/USD of 1.13 in 2019



1 The ROCE definition has been updated within the framework of IFRS 16 implementation. The asset value linked to the aircraft lease contracts now corresponds to the net book value of the right-of-use asset of all the lease contracts. Moreover, the “operating result, adjusted for operating leases” no longer existing having been replaced by “income from current operations” which, thanks to IFRS 16 implementation, no longer includes the financial cost of lease contracts. Finally, the Group now uses a normative income tax rate, calculated according to the tax rates applied in France and in the Netherlands.



Attachment