Air Europa bleeds out. The Hidalgo family airline, which was rescued last year by the rescue fund of the Sociedad Estatal de Participaciones Industriales (SEPI) with two loans of 475 million euros, recorded record losses of 427.7 million in 2020, compared to to 27 million benefits in 2019. A catastrophic result that leaves the company in an extreme situation and with a second state injection already flying over the company.
This is reflected in the accounts deposited by the company in the commercial register to which this newspaper has had access. The company’s auditor, KPMG, explains that the company has already made use of one of the two credits granted by SEPI -valued at 240 million- and leaves the door open to the need for additional help to face the coronavirus crisis. It even calls into question the survival of the company.
“It is expected that, depending on liquidity needs, the company will receive an additional amount with which to meet its future liquidity needs which will require the corresponding request for modification of the aid subject to the applicable regulations», Highlights the report.
Air Europa accounts draw a borderline situation for the company due to the coronavirus pandemic. In 2020, it had a turnover of 758 million euros, 32.4% less than in 2019 (2,340 million), while the volume of passengers fell by 33%, to 4.3 million travelers. Likewise, Air Europa presented a negative working capital amounting to 188.2 million euros and the losses it incurred in 2020 have reduced its net worth to a negative 364.3 million euros.
«The negative results are derived from the COVID-19 pandemic that has made the company’s activity is greatly affected. The Administrators consider that this situation will be reversed from the date of formulation of these annual accounts, the date on which the health situation is improved due to effects such as mass vaccination ”, explains the text.
To keep the company afloat, something that is far from assured, the management is negotiating different agreements with suppliers “on the due date of payments” regarding commitments and installments of aircraft leases especially. In addition, “actions on cost control, mainly personnel,” are carried out, such as the ERTEs to which the company has submitted its staff.
As KPMG recalls, Air Europa received in 2020, in addition to the rescue from SEPI, a syndicated loan with an ICO guarantee on 70% of the balance, from the financial entities with which it collaborates for an amount of 141 million euros with maturity 2025 and a grace period until May 2021.
The company was acquired last year by Iberia in exchange for 500 million euros. An operation that has yet to pass the Brussels filter and that, in principle, will be completed before the end of the year.
George is Digismak’s reported cum editor with 13 years of experience in Journalism