Qantas secures AU$1.05 billion in additional liquidity

©Qantas

The Qantas Group has completed a new round of debt funding, securing AU$1.05 billion in additional liquidity to strengthen its position as it manages through the coronavirus outbreak. This debt has been secured against part of the Group’s fleet of unencumbered aircraft, which were bought with cash in recent years. The loan has a tenure of up to ten-years at an interest rate of 2.75%. This funding increases the Group’s available cash balance to AU$2.95 billion with an additional AU$1 billion undrawn facility remaining available. The Group’s net debt position remains at the low end of its target range, at Read more

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U.S. airline stocks see massive boost as US$32bn bailout nears approval

©Delta Air Lines parked aircraft

U.S. airline stocks surged as U.S. lawmakers came much closer to agreeing up to US$32 billion in grants, as opposed to loans, for passenger and cargo airlines, together with associated contractors. Shares in American Airlines Group Inc rose 35% to $13.90, Delta Air Lines increased 22%, United Airlines went up 25% and JetBlue Airways Corp increased by 30%. The total amount of the aid will be divided up along the lines of an expected US$25 billion for airlines, US$4 billion for cargo carriers, and US$3 billion for contractors, such as caterers, etc. A critical element to the bailout, which was Read more

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IATA estimates industry passenger revenues could plummet US$252 billion below 2019’s figure

IATA’s Director General and CEO, Alexandre de Juniac

The International Air Transport Association (IATA) updated its analysis of the revenue impact of the COVID-19 pandemic on the global air transport industry. Owing to the severity of travel restrictions and the expected global recession, IATA now estimates that industry passenger revenues could plummet US$252 billion or 44% below 2019’s figure. This is in a scenario in which severe travel restrictions last for up to three months, followed by a gradual economic recovery later this year. IATA’s previous analysis of up to a US$113 billion revenue loss was made on March 5, 2020, before the countries around the world introduced Read more

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Norwegian fulfils criteria for initial NOK 300 million in guarantee from Norwegian Government

©Norwegian

Norwegian has reported that two Nordic banks have obtained credit committee approval to provide a guarantee for the required 10% for the first tranche of NOK 300 million. Norwegian will secure the necessary headroom to pursue further guarantees from the Norwegian Government. On March 19, the Norwegian Government proposed a guarantee of NOK 6 billion for the Norwegian airline industry, of which up to NOK 3 billion is directed to Norwegian. The guarantee will be up to 90% from the Norwegian Government provided that financial institutions contribute with the remaining 10%. The guarantee scheme will consist of three tranches with Read more

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Lufthansa Technik expects massive drop in revenue after record year 2019

Low pressure turbine installation ©LHT

Lufthansa Technik AG continued on its growth path in the past financial year and closed 2019 with record revenue and earnings. Revenue rose by 13% to €6.9 billion. Earnings before interest and taxes (adjusted EBIT) grew by around eleven percent to €493 million. The extent of the effects of the worldwide aviation crisis affecting Lufthansa Technik cannot yet be concretely foreseen, but the impact is already massive. Dr. Johannes Bussmann, Chairman of the Executive Board, said: “With the outbreak of the corona crisis, nothing is the same as it was just a few weeks ago. The maintenance industry is already Read more

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Lilium completes funding round worth more than US$240 million

©Lilium Jet

Lilium, the Munich-based aviation company developing an all-electric, vertical take-off and landing aircraft for regional air mobility, has completed an internal funding round worth more than US$240 million. The round was led by Tencent, with participation from other existing investors including Atomico, Freigeist and LGT. The new funds bring the total sum raised to date to more than US$340 million. They will be used to support further development of the Lilium Jet as well as underpinning preparations for serial production in Lilium’s newly-completed manufacturing facilities. As well as designing and manufacturing the Lilium Jet, the company plans to operate a Read more

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Sabre announces over US$200 million in cost saving actions

Sabre Corporation, the software and technology company that powers the global travel industry, is taking significant measures to strengthen its financial position in response to the current industry conditions. The travel industry continues to be adversely affected by the global health crisis caused by the outbreak of COVID-19, as well as by government directives that have been enacted to slow the spread of the virus. As part of these cost reductions, Sabre has begun implementing several immediate actions with regard to its workforce and other costs during this difficult business climate. These actions include: A reduction in the cash retainer Read more

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Boeing suspends dividends and CEO waives salary as planemaker seeks government loan

©Boeing

Boeing has confirmed that to assist with its request for government aid to aid both itself and other manufacturers in the aerospace supply chain, it will suspend paying any dividends, the company CEO will forego his salary, and the current embargo on share buybacks will remain in place, indefinitely. Like many companies in the aerospace sector, Boeing has been badly hit by the widespread economic effect of the COVD-19 outbreak and government aid will be critical to the survival of many. Boeing has been especially hard hit as it has been dealing with the fallout from the grounding of the Read more

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Airbus secures credit facility of €15 billion; withdraws 2020 guidance

©Airbus

Airbus will bolster its liquidity and balance sheet in response to the COVID-19 pandemic as it continues to assess the ongoing situation and the impact on its business, customers, suppliers and the industry as a whole.  Airbus’ management has received approval from the Board of Directors to secure a new credit facility amounting to €15 billion in addition to the existing €3 billion revolving credit facility. The company will withdraw the 2019 dividend proposal of €1.80 per share with an overall cash value of approximately €1.4 billion and suspend the voluntary top up in pension funding. Given the limited visibility Read more

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Finnair implements substantial funding plan

©AirTeamImages

Finnair is implementing a substantial funding plan in order to secure the company’s future even in a prolonged coronavirus situation. The plan includes funding instruments such as available credit lines, sale and leasebacks of unencumbered aircraft and a substantial, market-based pension premium loan. The available credit lines included in the funding plan consist of a revolving credit facility totaling €175 million which has already been raised. The statutory pension premium loan totals €600 million, and it has been proposed that the State of Finland would guarantee the loan. The Finnish Government’s Ministerial Committee on Economic Policy has considered the guarantee Read more

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