SAA losses mount for 2017
National carrier South African Airways made a further financial loss of R3.7-billion over the nine months to the end of 2017, as revenue dipped about R1-billion below its forecasts for that period.
The figures were tabled in a briefing by SAA CEO Vuyani Jarana, chairperson JB Magwaza and executives to Parliament's standing committee on finance. They predicted that the airline would stage a return to profitability in four years time as its turnaround strategy starts to reap fruit.
But for the current financial year the company is expected to show a loss of just less than R5-billion. It is expected to table these results in April after holding its annual general meeting on Thursday.
SAA saw a decline in passenger numbers in the period under review and dropped fares in response to increased competition. At the same time running costs rose, largely as a result of steeper fuel costs.
The airline has been a burden to the national purse for years, with then finance minister Malusi Gigaba dipping into the National Revenue Fund in September last year to give it a bailout of R3-billion to prevent it from defaulting on its debt obligations to Citibank. This followed a R2.2-billion bailout in June to enable it to cover its repayments to Standard Chartered.
Gigaba in February, shortly before he was moved to the home affairs portfolio in a Cabinet reshuffle, said government remained committed to plans to recapitalise SAA to the tune of R13-billion.
The airline late last year, after Jarana took over, negotiated the refinancing of R6-billion in debt to local lenders.
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